Finance Minister Urges Corporates To Support Economic Growth

Finance minister Nirmala Sitharaman on Saturday asked India Inc to invest in the economy so that the virtuous cycle kicks in.

Referring to the government's decision to cut corporate tax rate, she said the government has also opened up many sectors including atomic energy and space.

The government in September 2019 slashed corporate tax rate for companies that do not avail of any tax incentive, to 22 per cent. New manufacturing companies have to pay an even lower corporate tax rate of 15 per cent.

The budget for 2022-23 presented on February 1 proposed that the concessional 15 per cent corporate tax rate would be available for one more year till March 2024 for newly incorporated manufacturing units.

Addressing members of CII, she said industry should quickly join in the government to help virtuous cycle gain traction and push growth. 

There are many sunrise sectors where India has taken the lead, such as vaccines, genomics, space, atomic energy etc. India has proven its prowess in adoption of digital and the start-ups are an enabling force for innovation and new ideas, Ms Sitharaman said.

"The corporate sector should not lose this opportunity for higher growth," she added.

Speaking on the issue of rural distress, she explained that the same was being addressed in multiple ways. The budget has enabled access to tractors and other farm equipment through rentals as well as making credit available. The Government has ensured the availability of nutrients and fertilisers at affordable prices, despite the increase in global prices. Multiple welfare schemes have provided support for housing, cooking gas, electricity, healthcare etc.

Responding to the lower allocation to MNREGA as compared to the revised estimates of last year, she clarified that the budget allocation this year has been pegged at the allocation last year, and as the scheme is a demand-driven scheme, the higher allocation would be provided as per the demand.

Responding to industry suggestions, the finance minister acknowledged the need to be watchful of the increases in interest rates in developed countries and the high commodity prices. She welcomed the industry's suggestion of a regular dialogue on some of these external challenges.

On the privatisation of the two public sector banks and one general insurance company, as suggested in last year's Budget, she said that the Government is committed to taking forward the announced privatisations.