Sanjiv Bajaj urges government to cut personal income tax rates to revive demand

CII president Sanjiv Bajaj on Wednesday called for a cut in the rates of personal income tax as the next push in tax reforms by the government which will put more money in the hands of people and revive consumption and demand in the economy.

This is one of the measures that would help economic recovery, Bajaj, who is also the Chairman of Bajan Finserv, told the media in Bengaluru.

India, he said, needed to boost its forex reserves to revive the economy especially in view of the capital outflows by foreign institutional investors, prompted by an uncertain global economic environment. For this, the government should work towards inclusion of some of the large market cap companies into the global equity indices like MSCI and FTSE; expedite India’s entry into JP Morgan’s Global Emerging-Market Bond Index and Barclays Global Bond Index; and consider bringing out a special issue of India Millennial Bonds like was done in 2008, he added.


Bajaj sought extension of the Production Linked Incentive (PLI) Scheme into more sectors, especially those that are labour intensive and also in sectors where India’s imports were high and where there was a possibility of building a competitive domestic industry. “A PLI for electrolysers will help achieve India’s vision of producing 5 million tonnes of Green hydrogen by 2030 and also become an exporter of green hydrogen,” he said.

The concept of PLIs should be extended to services sectors in the form of Employment Linked Incentive Schemes (ELIs). To start with, CII suggests instituting ELIs in four employment intensive services sectors, with high growth potential – Tourism, Logistics, Retail and Film, Animation and Gaming.

The CII president urged the Central and State governments to bring all approvals and compliances onto the newly launched national single window system portal.

He called for a bigger push towards power sector reforms and urged the government to bring fuel and electricity duty under the GST to help industry claim input tax credit. This is one of the measures that would help economic recovery, Bajaj, who is also the Chairman of Bajan Finserv, told the media in Bengaluru.

India, he said, needed to boost its forex reserves to revive the economy especially in view of the capital outflows by foreign institutional investors, prompted by an uncertain global economic environment.