Tuesday, January 11 2005 21:43 Hrs (IST) - World Time -

New Delhi: Favouring an investment-friendly budget to attain 8-10 per cent GDP growth, India Inc today (Jan 11, 2005) pitched for 5 per cent cut in corporate tax and customs duty, especially on petroleum, to make industry globally competitive.

Leading industry chambers -- CII, FICCI, ASSOCHAM -- asked the Government to lower income and corporate tax rates to increase the tax base from 3 crore to 15 crore, so as to boost revenues and cut the Centre's revenue deficit.

In their pre-budget meeting with Finance Minister P Chidambaram, India Inc proposed a slew of measures that would boost investment to enable the economy to move to a higher 8-10 per cent growth trajectory.

Industrialists also asked the Government to go for radical reforms, speed up disinvestment to mop up Rs 25,000 crore annually and hike FDI in sectors like telecom and insurance.

Noted industrialists like Reliance Industries chairman Mukesh Ambani and Maruti Udyog managing director Jagdish Khattar called for lowering customs duty on crude oil from 10 to 5 per cent. Ambani also pitched for rationalisation of subsidies, especially on LPG and kerosene, and make their prices market determined.

Stressing on fiscal prudence, CII president S K Munjal said, "Centre should focus on the revenue side and not fiscal deficit."

FICCI president Onkar Kanwar mooted downsizing of Government as recommended in the Fifth Pay Commission and Geethakrishnan panel to curtail revenue deficit.

ASSOCHAM president M K Sanghi said budget should give a thrust to infrastructure sector to spur growth.

Highlighting the need for boosting exports, FIEO president O P Garg said the income tax facility for export-oriented units and special economic zones should be extended to domestic units exporting more than 75 per cent of their products.

CII proposed identification of a few industries -- textiles, auto ancillary, BPO, food processing and construction -- and providing them with incentives to enable them to become globally competitive.

"Prepare the annual budget as part of a medium term economic strategy for accelerating growth," Munjal said.

To boost infrastructure, he asked the Government to come up with policies for promoting FDI, establish development board with private and public participation, and set up regulatory mechanism for roads, power, ports and airports.

FICCI asked the Government to lay special emphasis on labour-intensive industries like textiles, jems and jewellery and agro-processing, promote investments in cold storages and tax incentives for agri infrastructure.

Mergers and acquisitions should be encouraged and made tax-friendly, exit options made easy and stamp duties should be slashed, FICCI said.

Voicing the concerns of auto industry, Khattar said the Special Excise Duty of 8 per cent should be abolished, sops for R&D should be extended beyond one year, customs duty on inputs should be bought down to 5 per cent and retirement period for old vehicles reduced.