Corporate leaders on Wednesday asked for a bigger fiscal boost to spur growth to revive various sectors hit hard by shrinking demand at home and abroad.
“We have urged the government to create a growth package for various sectors that have been affected due to the slowdown,” Harsh Pati Singhania, senior vice-president of the Federation of Indian Chambers of Commerce and Industry (Ficci) told reporters after a nine-member delegation of industrialists met senior government officials led by Cabinet Secretary KM Chandrasekhar.
“We need big investment push and we have suggested this to the government,” Singhania said after the meeting that was attended by Finance Secretary Arun Ramanathan, Commerce Secretary GK Pillai and industry secretary Ajay Shankar.
The 15 per cent year-on-year fall in excise duty collections in November mirrors poor industrial output. Factory output contracted by 0.4 percentage point year-on-year in October, driven largely by a reduction in manufacturing growth.
In a mini-budget of sorts, the government recently announced central value added tax (a tax imposed by the Centre at different stages of the manufacturing process) by 4 percentage points for the rest of this financial year, and unveiled a Rs 35,000 crore fiscal package.
All told, the total spending programme in the last four months of the current financial year is expected to be Rs 300,000 crore.
Warning signs have begun to show on the country’s macroeconomic indicators with latest official revenue data suggesting the government’s books could have a bigger hole.
Besides Singhania, the Ficci delegation included DLF Group chairman KP Singh, Steel Authority of India chairman SK Roongta, and Confederation of Indian Textiles Industry’s deputy chairman Shishir Jaipuria.