The chairman of Hero Enterprises said that whoever comes to power at the Centre should have a multi-decade vision and not look to score quick political points.
Sunil Kant Munjal, chairman, Hero Enterprise told BusinessLine that a multi-decade vision is what the country requires. “For a country like ours with diversity, disparity, geographical spread and extremes of economic development, a long-term blueprint is a must.”
He said, while the demonetisation impact might still be playing out, the introduction of GST has formalised the economy to an extent. These measures have also led to greater tax buoyancy, and an increase in the number of income-tax payers. “We are being set up for reasonably good growth in the coming decade, even as the US-China trade dispute and other factors such as crude are adding to near-term global stress.”
Munjal, one of the founder-promoters of the diversified Hero Group, said India’s biggest tasks are eradication of poverty and reducing disparity across regions. While resolution of these problems remains a work in progress, interesting opportunities are also emerging from these challenges in the areas of healthcare, education and waste management.
Referring to the downward trend in the auto industry, he said it will not last. “As we have seen in the past, the sector always bounces back after a sluggish phase. This because of the country’s inherent robustness and the world-class characteristics that the auto industry has acquired over the last three decades”, he said.
He pointed out that there were more Deming Prize (one of the highest awards for implementing total quality management) winners in the country than any outside of Japan.
“Permissions at multiple levels are still required even after the GST came into existence. Our costs are still higher than the rest of the world. If we add to this the frequent policy changes, the situation becomes even more challenging,” Munjal said.
On corporate tax, Munjal said that competition globally is driving down corporate taxes. While quite a few countries have brought corporate taxes down to less than 15 per cent, India is still mulling over whether this rate should come down to 25 per cent. The Centre announced a roadmap to bring it down to 25 per cent, but this should be done immediately and a roadmap of reducing it further to 18 per cent should be discussed, he said.
“The government should give companies an option; if they want to operate without any exemption, then this lower rate should be applicable. In this way, there is transparency, and nobody fudges figures. For too long, our system has been prone to misinterpretation; and this has led to confusion,” he said.