ICC urges incentives for Agro-Industries

In its pre-Budget memorandum, the Indian Chamber of Commerce has emphasized the need for new fiscal incentives to help the growth of the agricultural sector.

In its pre-Budget memorandum submitted to Govt, the Indian Chamber of Commerce has emphasized the need for new fiscal incentives to help the growth of the agricultural sector.

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"Agro-processing industries need to be given significant encouragement to ensure value addition in agriculture and better post harvest utilization of products," said ICC president.

The ICC chief said that value creation in the Agriculture Sector in India would also generate higher demand for industrial products and provide a fillip to the service industry.

"Given the multiplier effect, this would have a significant impact on employment generation as well," he adds.

The ICC has also called for a special weighted tax deduction of 125% to both capital and revenue expenditure incurred for the purpose of building of proper computerized infrastructural facilities for agriculture and electronic highways for procurement, development of cold chains, dissemination of best practices, weather information, and storage facilities.

The ICC president said the growth in the agriculture sector will be constrained by the lack of processing industries.

Absence of food processing industries also led to huge wastages due to the high reserves and inadequate facilities for storage and transport.

India was already self sufficient in food, and unless processing was given higher priority, the country would not be able to leverage the huge potential for value addition in the agricultural sector.

The ICC has therefore demanded the granting of 100% tax exemption to agro-processing industries under Section 80IA, as in the case of other sectors such as infrastructure.

This priority status would attract investments in this sector and help in raising the agricultural sector's contribution to the GDP significantly.