India not only has the potential to achieve double-digit growth but can also pull it off, finance minister Arun Jaitley said here on Friday, based on the work done by the government.
The minister also addressed the question of retrospective taxes — a top concern for international investors — saying he was looking for a way to “put the whole issue to quietus”.
Speaking at a think tank event on India’s roadmap to double-digit growth, Jaitley said, “The journey between 8% and 10% is not an impossible journey. It’s crossable. I think that’s where India’s real potential is.”
He said India would hopefully touch 8% growth this year — from 7.5%% last year — even without the impact of those measures. “Once the impact of all these changes and investment is felt, I think there could be significant growth,” he said.
However, the minister added, it was not only important to achieve that target but to be able to sustain it for a couple of years. “If we are able to sustain it for a couple of years, then I think, we will be able to have direct benefits as far as India is concerned — more jobs, better economy and hopefully over the next 10 years or so, deplete the poverty levels in the segments that are most impacted by it.”
On retrospective taxes, Jaitley said, “I am looking for a methodology where I can, without stirring a controversy, put a quietus to the whole issue.”
The minister has been dogged by questions about retrospective taxes at almost every event he has addressed on his visit. It came up in New York on Thursday and then on Friday.
“I would like you to please talk a bit about the philosophy of those changes making investments a bit more difficult to underwrite,” he was asked in New York.
And on Friday, he was asked why the government could simply not scrap the law, which was a bad one. Jaitley said he believed the “law per se was an unfair law”.
He said the government will, one, not legislate a tax with retrospective effect and two, not issue fresh notices under the old law. “Not a single notice has been issued, nor is it likely to be,” he said.
However, the issue has lingered, impacting investor sentiment.
FM’s money speak
Speaking at a think tank event on India’s roadmap to double-digit growth, the minister also addressed the question of retrospective taxes. Jaitley said the country’s real potential was in crossing the journey between 8% and 10% growth.
He added that it was not only important to achieve the target but also sustain it for a couple of years. On retrospective taxes, Jaitley said, “I am looking for a methodology where I can, without stirring a controversy, put a quietus to the whole issue.”