Narendra Modi pledges stable tax policy to woo American business
September, 30th 2014
Prime Minister Narendra Modi on Monday pitched for investments from some of the largest American corporations with the promise of a stable tax policy and an assertion that he wants to convert the Supreme Court ruling on coal block allocation into an opportunity to move forward and "clean up the past".
"It is my conviction that tax stability is essential for confidence building," said Modi, who hosted 11 CEOs for breakfast. The Prime Minister's comment on a stable tax regime comes amidst severe criticism of the policies followed during the UPA regime, including retrospective amendments to the law to claim taxes from Vodafone that acquired Hutch's telecom assets in India. Modi and his collegues have not shied away from referring to the policies as "tax terrorism".
His candidness extended to the coal block allocations as well since the court ruling is seen to be harsh by corporates as it impacts awards going back two decades and comes at a time when the government is keen to boost investor sentiment.
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The Prime Minister — who has given economic turnaround top billing in his scheme of things — told CEOs including Google chairman Eric Schmidt, Citigroup CEO Michael Corbat, PepsiCo's Indra Nooyi, GE's Jeff Immelt and drugmaker Merck's Kenneth C Frazier that the government is open to suggestions to speed up activity in Asia's third largest economy.
While hearing out the concerns expressed by business leaders, Modi assured them that his government would address the problems and try to make the overall environment more business-friendly. "India is open-minded. We want change. Change that is not one-sided. Am discussing with citizens, industrialists & investors," Modi was quoted as saying in a tweet by the MEA spokesperson.
He flagged infrastructure development as a key activity for overseas investors, arguing that it creates jobs and improves the quality of life. The government is keen to ensure that every village has 24x7 electricity supply, road development picks up speed again, ports have enough capacity to boost trade and airports are modernized.