‘Indian policy makers still suffer from regulatory mind set’

Finance Minister Arun Jaitley said on Saturday that Indian <g data-gr-id="81">policy makers</g> need to change their regulatory mindset, asserting that the role of the State should be minimised and government monopoly must end wherever possible. Speaking at the National Workshop on Citizen-Centric 

Governance, he said that the economic reforms, which seek to promote easing of doing business, will continue as these are “never-ending processes and do not have a finishing line”.

Jaitley said that policy makers in India still have a “regulatory mindset” which needs to change even as he spoke of the urgency for policing reforms to make police-citizen interaction more civilised.

“... the control temperament or the control freak temperament of the political system has still not been fully done away with and there is a legacy to it,” Jaitley said, adding that all actions of the government should be aimed at “providing a better quality of life to citizens and minimising the role of the government”.

“Wherever possible, the role of the state should be minimised... the government’s monopoly must end. Wherever we have ended them, we are better-off. We have ended them in the airlines sector, we have not ended them in the railway sector. And the result is very clear,” the finance minister opined.

“There are many ways of doing this. As far as processes are concerned, every department has to take simplification exercise and particularly those departments which have the interface with the public,” he said.

Jaitley mentioned that the use of technology has helped in improving the system of filing income tax returns and expeditiously providing refunds. “Ease of doing business means providing a better regime than neighbours and tax rates which are globally competitive,” he said.

The Government intends to reduce corporate tax to 25 per cent from 30 per cent in the next four years and do away with “most of the tax exemptions”, the finance minister added.

As a result of all the corporate exemption, Jaitley said, the actual realisation of the government is 22 <g data-gr-id="58">per cent</g>. 

“So we have a bad (global) image of 30 per cent plus <g data-gr-id="76">tax-charging</g> economy, but our receipt is 22 <g data-gr-id="67">per cent</g>. <g data-gr-id="75">Bulk</g> of tax litigation is around because of these exemptions,” he pointed out.

“So I took a decision, I would bring down the corporate tax over the next four years to 25 <g data-gr-id="70">per cent</g>, and phase out almost all exemptions,” he said.

“So in the end, it will help in getting <g data-gr-id="86">higher</g> amount of tax, he said, adding that “optically my taxation be globally competitive...this is the kind of reform we require.”  Talking about another reform, the finance minister said, the JAM (Jan Dhan Yojana, Aadhaar and Mobile) trinity has helped in saving leakages.

Putting liquefied petroleum gas (LPG) in Jan Dhan Yojana, Aadhaar and Mobile has saved 30 <g data-gr-id="56">per cent</g> of liquefied petroleum gas subsidy, he said.

Referring to delays in the judicial process, Jaitley said that a law which sought to prescribe a time limit for adjudication of specified cases was frustrated by a Supreme Court order which said that time limits are only directions and not mandatory.

“When I was the law minister, I made changes in Civil Procedure Code to say that this (adjudication) may be done in 60 days, this must be done in 30 days. So the whole Parliamentary verdict was frustrated by a Supreme Court judgement which said that these dates that Parliament has said to do <g data-gr-id="87">is</g> directory and not mandatory; for good reasons we can violate this,” the finance minister observed.

Because of such delays in the judicial process, foreign investors insist on arbitration in other countries, he said, adding, “So, international investors start with a statement of no confidence because of the pace of the Indian courts.”

Stressing on the need for police reform, Jaitley said, “I think it is here that the largest reforms are required. And the single largest reform is required in the police-citizens relationship.” 

“You can’t have a society where people are scared and reluctant to deal with the police,” he pointed out. There is a need to bring reforms in the training process of police and bring a change in <g data-gr-id="94">attitude</g> of policemen towards citizens, he concluded.

Meanwhile, according to a report fromMumbai, Maharashtra Chief Minister Devendra Fadnavis said on Saturday that three Japanese companies have handed over letters of intent (LoIs) for investment in the state under the government’s ‘Make in Maharashtra’ programme. Takeshi Washitani, Chief Executive Director of <g data-gr-id="85">A S</g> BRAIN Co, handed over the letter of intent to Fadnavis. The company has expressed its intention to start hospitality, infrastructure and IT businesses in Maharashtra.

On behalf of A2Care, its president Hiroshi Okamoto, handed over the document to Fadnavis. A2Care is a pharmaceutical company and manufactures water treatment products to supply clean river and dam water. Chief Executive Director of ElecTrike Japan, Noboru Matsunami, disclosed his company’s plan to manufacture eTrike (electric tricycle) in Maharashtra. 

MIDC and Mizuho Bank signed a memorandum of understanding (MoU) in 

the presence of Fadnavis to accelerate investment activities in India. “This MoU will accelerate Japanese companies’ efforts to promote economic expansion in India and particularly, in Maharashtra,” the Chief Minister said.