BENGALURU -- Prime Minister Narendra Modi on Tuesday expressed the hope that Goods and Services Tax (GST) will be rolled out next year.
Addressing Indian and German business leaders here, Modi said, "We have introduced GST bill in Parliament and hope to roll it out in 2016."
The Bill has already been approved by the Lok Sabha and is pending in the Rajya Sabha, where the ruling NDA does not have a majority.
After its approval by Parliament, half of the state legislatures too need to approve the Constitutional Amendment Bill to bring a GST as a replacement to all indirect taxes.
Modi said the government has taken decisive steps to remove long pending concerns of investors. "We have clearly articulated that we will not resort to retrospective taxation."
The Business Forum organised by @nasscom & Frauenhofer Institute illustrated the strong potential in India-Germany economic collaboration.— Narendra Modi (@narendramodi) October 6, 2015
This position has been reinforced by not going for imposition of MAT on foreign portfolio investors, he said. "We have also decided to defer the implementation of the general anti avoidance rules (GAAR) for 2 years."
Stating that a series of measures taken during the 15 months of BJP rule has restored credibility of India in eyes of global players, he said the government was speeding up regulatory clearances, reducing licensing requirements in the defence sector and making tax policy more consistent.
Validity period of industrial licences has been increased, defence items de-licensed and a number of restrictions like end use certificate has been liberalised, he said.
I spoke at length on how India has emerged as a bright spot for investments, even at a time of a global slowdown. http://t.co/5LDMA4ImRF— Narendra Modi (@narendramodi) October 6, 2015
"We have increased the validity period of defence industrial licences up to to 18 years from 3 years," he said, adding that regulation for alternative investment funds allowing foreign investments in such funds has been notified.
Also capital gains tax regime for real estate investment trusts has been rationalised.
Foreign direct investment (FDI) inflows have increased 40 per cent this fiscal, he said.
Witnessing the various technological innovations at Bosch. pic.twitter.com/s5sx61O4ce— Narendra Modi (@narendramodi) October 6, 2015
Government, Modi said, has fast-tracked approvals and clearances for industry as well as the infrastructure sector and is committed to creating favourable conditions for business.
India is sailing in the right direction but could not be complacent, he said, adding that it presented a "bright spot" for investment when the world is facing a slowdown.
India's software will move hardware across the world. India's talent will master technology & our market will motivate manufacturing.— Narendra Modi (@narendramodi) October 6, 2015
On Indo-German business ties, Modi said they remain below full the economic potential and India wants to develop relationship with Germany in various sectors.
"It is the software of India that will move the hardware of the world," Modi sought to emphasise at the "Indo-German Summit 2015: Digitizing Tomorrow Together."
Five B2B (business-to-business) agreements were exchanged in the presence of Modi and Merkel at the event.
Merkel said she and Modi are working together for reform of the UN Security Council through the G4 - Brazil, Germany, India, and Japan which support each other's bids for permanent seats on the UN body.
Merkel said she and Modi would meet again in November at the G-20 summit. She said while India needs high skilled jobs, Germany requires high skilled labour.
German engineering and India's IT expertise are fused here in Bengaluru, said Merkel.
The Prime Minister hosted a special lunch for Merkel with leading Indian CEOs at the summit, organised by National Association of Software and Services Companies (Nasscom) - in collaboration with the German Fraunhofer Institute.
Earlier, Modi and Merkel visited the facilities of German automotive major Bosch here, as part of the chancellor's three-day state visit to India, with focus on innovation and skills development.
To further strengthen its presence in India, Bosch said it plans to invest Rs 650 crore (over 100 million euros) in 2015.
I laud Chancellor Merkel for her vision where German engineering & Indian IT fuse to create world class products.— Narendra Modi (@narendramodi) October 6, 2015
During the nearly two-hour long visit, the two leaders, accompanied by a high-level German delegation, walked through the Bosch Innovation Center and the vocational training centre, enquiring about the company's research, engineering, and vocational education activities in India.
"Readying the ground force for 'Make in India'," Ministry of External Affairs Spokesman Vikas Swarup tweeted as the two leaders went through the facility, where they were gifted the "lion", the logo of the 'Make in India' campaign.
As she leaves India, gratitude to Chancellor Merkel. This has been a productive visit, which has taken India-Germany ties to newer heights.— Narendra Modi (@narendramodi) October 6, 2015
"Preparing the next generation of technicians. Making the vision of Skill India a reality," Swarup said in his tweets during the visit of the two leaders, as they were briefed on on "Industrie 4.0 to Big Data" on solutions developed at Bosch India.