In a major boost to Prime Minister Narendra Modi’s signature “Make in India” programme, commerce minister Nirmala Sitharaman has called upon finance minister Arun Jaitley, seeking duty exemptions to boost manufacturing and exports in the upcoming budget.
Sitharaman along with commerce secretary Rajeev Kher and industry secretary Amitabh Kant met Jaitley and revenue secretary Shaktikantha Das late last week, sources said.
“Various duty corrections (both in customs and excise) to deal with inverted duty structure issues, reductions in taxes such as minimum alternate tax (MAT), special additional duty (SAD), CENVAT have been sought to address concerns, which have hit the competitiveness of the domestic manufacturing industry,” sources said.
Sitharaman has been assured that issues including taxes on raw materials, special benefits for small industries, manufacturing hubs and SEZs would be looked into, sources added.
Besides, sectors including gems and jewellery, automobile and auto components, electronics and pharmaceuticals, capital goods, machinery and renewable energy are also likely to have a special focus.
The industry has been demanding a correction of the inverted duty structure — taxing inputs at higher rates than finished products — to address the cascading effect on their costs.
Experts said the government needs to address the issue of inverted duty structure to increase the share of manufacturing from the current 16% to 25% of GDP.