2/20/2015 Firms see a reformist budget ­ Livemint

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Finance minister Arun Jaitley will present the Union Budget2015 on 28 February. Photo: Mint

New Delhi: Indian companies expect the budget that will be presented by finance minister Arun Jaitley next week to make iteasier to make in India as well as do business in the country, according to a survey conducted by tax advisory BMR Advisors.

The overwhelmingly optimistic note of the responses—179 senior executives from Indian companies and multinationalsoperating in India were surveyed by BMR—contrast with the criticism the Bharatiya Janata Party (BJP)­led NationalDemocratic Alliance (NDA) government has faced in recent months.

Such criticism has broadly been along two lines: one, that thegovernment’s good intentions are not translating into thedesired outcomes; and two, that events such as re­conversion camps organized by right­wing groups andattacks on churches have taken the sheen off thedevelopment agenda.

On Wednesday, Deepak Parekh, chairman of HousingDevelopment Finance Corp. Ltd and an elder statesman inbusiness circles, told news agency PTI that while businessesand businessmen are still optimistic that the government willdeliver, there has been little change on the ground in thenine months since the NDA government took charge of thecountry.

The NDA under Prime Minister Narendra Modi came topower with a popular mandate after people voted out the

Congress­led United Progressive Alliance that had ruled India for 10 years since 2004 and which came under fire for a spateof corruption scandals as well as its mishandling of the economy.

Projects suffered over delays in acquiring land, securing environmental clearances and irregularities in the allotment ofnatural resources. An activist tax department embarked on a campaign of litigation. And a shell­shocked government steeredclear of policymaking, presumably out of fear of more missteps.

The BJP was seen as more business­ and investor­friendly.

In the nine months since it has come to power, it has sought to accelerate environmental clearances—stoking fears of dirtygrowth—and also indicated its unwillingness to raise unfair tax demands and pursue them in court (although it has stopped

short of changing underlying legislation).

2/20/2015 Firms see a reformist budget ­ Livemint

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It has also worked towards reviving investments and makingit easier to do business in India. On Thursday, for instance,the government launched a portal Ebiz (www.ebiz.gov.in),offering 11 government services.

Businessmen still think the Modi government will be “good forbusiness”, Parekh said on Wednesday, but “after ninemonths, there is a little bit of impatience creeping in as to whyno changes are happening...”.

That optimism is evident in the findings of the BMR survey.An overwhelming majority says the government will prioritizegrowth over fiscal management, announce a plan tosystematically divest its stake in state­owned firms, and clarifytax laws (including those on transfer pricing, one area wherethe tax department embarked on a wave of litigation) toremove uncertainty among investors.

The respondents also believe the government is likely tomake at least some announcements on the proposed goodsand services tax, such as the rate and the road map for itsrollout. The tax will unify the Indian market and some expertsbelieve it could add at least a percentage point to India’sgross d