According to the plan, India can attract $100 billion in FDI annually, provided it matches up to the financial incentives of competing countries like Vietnam.
The Ministry of Commerce and Industry has proposed a customised incentive package to attract foreign investments in certain sectors among which electronics acquire a strong place, an official said to PTI.
The proposal is part of a 100-day action plan prepared by the Department for Promotion of Industry and Internal Trade (DPIIT), an arm of the ministry, for the new government.
According to the plan, India can attract $100 billion of foreign direct investment annually, provided it matches up to the financial incentives of competing countries like Vietnam.
The Southeast Asian nation provides a host of incentives to foreign investors such a low rate of corporate income tax and tax exemptions up to four years.
Plan of action
The 10-point action plan has also proposed a favourable tax regime, formulation of employment generation strategy through legal changes, proper allocation of natural resources, support for small businesses, steps to promote budding entrepreneurs, the release of new industrial policy.
Commerce and Industry Minister Suresh Prabhu had carried out a series of consultations across the country for the formulation of a detailed industrial policy.
“There is no justification of having a separate tax regime for non-corporate business entities,” the official said.
It has noted that there is a need to remove legal impediments in labour-intensive industry as restrictive labour laws do not allow businesses to scale up and discourages formal hiring of labour.
Further, the action plan has recommended the formulation of a national retail policy to help 65 million small traders.
Besides, there is a proposal to provide support to small businesses in terms of marketing their product and make them more competitive.
These actionable strategies and interventions will address challenges and lay out the priorities for industrial development in the future, the official added.
