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India Put Out Best Corporate Tax Regime, Its Story Has Just Begun: NITI Aayog CEO
The perception of American investors toward China changed... They will always be looking for alternative investment destinations.
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NITI Aayog CEO Amitabh Kant on Friday (local time) said India has put out "probably the best" corporate tax regime in the world now and asserted that the country should use the strength of its domestic market as the structural reforms make it the most attractive destination for investments.
"The perception of American investors toward China changed... They will always be looking for alternative investment destinations. Now, one is Vietnam which has limited skills and very limited domestic market. India should really use the strength of its domestic market," Kant told ANI. "India has put out probably the best corporate tax regime in the world now. At 15% with an effective rate of 17.1%, makes it the best country as far as corporate tax is concerned... This corporate tax coupled with the size of the domestic market, plus the fact that you pushed digitisation and structural reforms that have been carried out makes India a very-very attractive destination for investment," he added.
The NITI Aayog CEO said that there are massive opportunities in sectors like electronics, pharmaceutical sector and sports goods in India.
"We have been talking to a number of companies, Apple has already made very substantial investments into India.
They are looking at a much bigger period. There are massive opportunities in sectors like electronics, pharmaceutical sector and sports goods. India should really look at 5-6 sectors where it can be a global champion, penetrating global markets," he said.
Kant underlined that amalgamation of 54 labour laws into just four will allow companies to do large-scale manufacturing in India.
"... The big thing that happened in India is an amalgamation of 54 labour laws into just 4 laws and making structural reforms there. This to my mind is really path-breaking that will allow you to do large-scale manufacturing in India," he said.
He also asserted that a huge amount of work has been done to improve India's intellectual property rights (IPR) regime.
"India is a great believer in intellectual property rights (IPR). We come out with a new policy on IPR. IPR regime has radically improved. We benchmarked against USA and Japan now. Patent rights are being given within a period of 18-24 months now. A huge amount of work has been done to improve India's IPR regime that had concerns of USA," Kant said to ANI.
The NITI Aayog CEO highlighted top American companies engineering R&D either in Bangalore and Hyderabad.
"Silicon Valley has a much closer relationship with Bangalore with reference to the USA. Every top American company today has engineering and R&D either in Bangalore and Hyderabad. Nearly 1,400 companies are doing this (engineering and R&D) in these two cities and now moving to Pune and Gurgaon," he said.
"People sitting here (USA) don't realise this but a lot of innovation in the rest of the world is happening in India particularly being done by American companies. So, all these companies are actually employing close to 20,000 people just to engineering R&D... It's very close and tied up the relationship between America and India in many ways. I think this is really the hallmark of our relationship and I personally think that fundamentals of Indian economy are very-very strong," he said.
CEO Kant emphasised that the reforms carried out in India are very structural in nature that is the reason there is a huge opportunity for growth in the country.
"The reforms carried out are very structural in nature. India's story has just begun because of these far-reaching reforms and India's urbanisation which has just begun. We will be doing more urbanisation in the next five decades than what we have done in 500 years," he said.
"We are the only country which is doing 100 smart cities, India is the only country with 50 metros and the government is rolling out a whole programme of asset monetisation. We are putting out 10,000 kilometres of roads and new airports, which were owned by the Airports Authority of India for privatisation. We are doing major public sector privatisation," Kant added.
"Monesatisation in the public sector actually provides a massive opportunity to companies' pension funds and large PE investors. All of them to put resources in India and created wealth out of India because there is a huge opportunity for growth in India. Therefore, I feel that India's story will be told over the next 2-3 decades," he concluded.