The Hindu Business Line : We'll open doors to all kinds of investments: Chidambaram

The Finance Minister, Mr P. Chidambaram, addressing a meet on `Double digit growth: Ambitious but realistic', organised by the Associated Chambers of Commerce and Indusry of India in the Capital on Saturday. - Kamal Narang

New Delhi , July 24

THE opposition from the Left parties on the foreign direct investment (FDI) front notwithstanding, the Finance Minister, Mr P. Chidambaram, on Saturday promised captains of industry that the Government was committed to economic reforms and creation of enabling climate for investments in the economy.

"I promise that nothing will deflect us (the Prime Minister, Dr Manmohan Singh, and myself) away from economic reforms. We are committed to economic reforms. The Government will unshackle every sector and open Indian doors to every kind of investment," Mr Chidambaram told members of the Associated Chambers of Commerce and Industry of India (Assocham) here on Saturday.

Mr Chidambaram claimed that he has no difficulty in engaging with the Left parties on various issues including FDI. "My difficulty arises from people who keep changing their convictions. The Left has always been having the same convictions," he said, while making a tacit reference to the opposition parties.

The Finance Minister urged industry to engage the Members of Parliament to explain to them "what you think is good for economic reforms."

Responding to the remarks made by Assocham President, Mr Mahendra K. Sanghi, that the tax revenue targets for 2004-05 is "ambitious" and seem to be a challenging task to achieve, Mr Chidambaram held that there has been no extravagant assumptions on his part and that he was confident of meeting the revenue targets.

"I have only taken the assumptions made in the interim budget in February and simply added the education cess, transaction tax and a tidy sum towards recoverable undisputed arrears," he said.

Responding to a query from Mr Saroj K. Datta, Executive Director, Jet Airways, on the budget proposal relating to withdrawal of tax exemption on any payment made by an Indian company to a foreign enterprise to acquire an aircraft on lease, Mr Chidambaram indicated that there will be no rethink on this proposal.

"We are only taxing the lessor, which is a foreign company in this case. I suppose it will be paying taxes on income and therefore can claim credit in its home country for the tax paid on lease revenues earned from India. If I don't tax such payments, then I am exporting tax revenues to a foreign country," he said.

The Finance Minister even suggested that Jet Airways should look at purchasing aircraft instead of leasing them if the airline is keen to save taxes on lease payments.

`Debate Kelkar's tax proposals'

THE Finance Minister, Mr P. Chidambaram, has urged corporate India and other sections of society to debate the various radical tax proposals suggested in the reports of the Kelkar Task Force on the Fiscal Responsibility and Budgetary Management Act 2003 (FRBM) and the Rakesh Mohan Committee on small savings.

"The Kelkar task force report is one of the reasons why I did not take up big-bang tax reforms in this year's budget. The report has been submitted yesterday to me and is now open for public debate. You must in the next seven months debate on this and also on the report on saving instruments to build a consensus on the tax regime that India should have. A sensible tax regime would be the major story of 2005," he said.

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