Invest without fear to achieve $5 trillion economy target, Modi tells industry

Prime minister Narendra Modi at ASSOCHAM centenary
Prime minister addressing AASSOCHAM members in New Delhi on Friday.

Prime Minister Narendra Modi on Friday asked banks and corporates to take decisions without fear, assuring them that no action will be taken against them for genuine commercial decisions that turned bad. The corporate sector can function in a fearless ecosystem with the government decriminalising several laws governing the corporate sector, he told the members of industry body ASSOCHAM in New Delhi. The corporate tax in the country is the lowest ever and will boost economic growth, he said.

Under his government, the country has made itself strong that it could achieve the $5 trillion target, Modi said. The economy was heading towards a disaster under the earlier dispensation and his government stopped it by bringing in discipline in the economy,” he added.

The prime minister said his government is building the economy on the twin pillars of formalisation and modernisation, adding more and more sectors are being brought into the formal economy. Indian economy has seen bad times, but has always emerged stronger, he said, adding that his government has overcome the legacy weaknesses.

The prime minister reminded the audience that economic growth slipped to 3.5% during one quarter under the UPA rule, adding there times when retail inflation, core retail inflation, wholesale inflation and fiscal deficit were at 9.4%, 7.3%, 5.2%, and 5.6% respectively. India has emerged stronger from these times of crisis, the prime minister said.

Indian economy grew at 4.5% in the second quarter of the financial year ending Septermber. The Reserve Bank has reduced the growth forecast for the year to 5%.

It now takes a few hour to register a new company when it used to take several weeks earlier. Automation is helping trading across borders and good infrastructure has reduced turn-around time at airports and ports, the prime minister said. Modi said the government’s efforts have resulted in a significant improvement in the ease of doing business.

The faceless tax administration will reduce the human interface between the tax payer and the authorities, resulting in better efficiency, accountability and transparency in tax administration,” the prime minister said.