Retrospective decisions creating liabilities unacceptable: Finance Minister
New York: Allying concerns of American business community and investors, Finance Minister Arun Jaitley has said that any decision which is retrospective and creates fresh liabilities is not acceptable.
“I have no difficulty in saying that any decision which is retrospective, except in some very unusual circumstances, which creates fresh liabilities is certainly not acceptable,” he told a New York audience when asked about the concerns of the US business community with regard to retrospective taxes.
“Therefore, ever since the present government has been formed, we said it when we were not in government and therefore we’ve lived up to our word, this government will not legislate anything that is retrospective,” he said during an interaction at the Council on Foreign Relations, a think tank.
“Many of us who have done business in India have experienced retroactive changes to some of the investment regulations by the government or the Reserve Bank of India. In the spirit of expanding the opportunity for foreign investment, I’d like you to please talk a bit about the philosophy of those retroactive changes making transactions a bit more difficult to underwrite,” Jaitley was asked by a US businessman.
Responding to a question on infrastructure, Jaitley said the Union Government has started putting money in this sector.
“The government has started putting money substantially into the sector so the sector will start moving. The resources have come from the budget. The resources have come from the increased tax on petrol and diesel. And therefore extra resources this year have been put in,” he said.
“The result of this is that a completely stalled infrastructure sector has started moving. Today, still short of our target, but we have now started building about 13 kilometers a day. Our target is to cross 20 and reach 30 kilometers a day of national highways,” he said.
Jaitley said the present “agrarian distress will carry” on unless “we are able to make lesser number of people dependent” on agriculture for livelihood.
“Therefore, you need to get a large number of people out into other areas,” he said.
And, ultimately, this whole debate on the land law in India is centered around this point, the minister said.
Asserting that the 2013 land law is the most “unfriendly law” to the rural sector, he said, “It prevents irrigation projects. It prevents rural roads. It prevents rural electrification projects, because it doesn’t make land available for any one of them. It prevents low-cost housing in rural areas, land available for that.