The Indian economy could double in size to be a $4-5 trillion economy in the next 10-12 years, Minister of State for Finance Jayant Sinha said, as he pledged a crackdown on tax evasion, and a “fair and predictable” tax regime.

Speaking by video conference to an India Inc conference in London, Sinha said the country set to return to over 8 per cent growth. And the government should strive to maintain this growth consistently over the next decade.

“When we inherited the economy a year ago we inherited a macro economic basket case,” said the Minister describing the revival in growth and fall in inflation as “extraordinary.”

Outlining the government’s five-point strategy to stimulate the economy, including achieving a stronger fiscal position, he pledged a government crackdown on non-compliance, including in the retail, and unorganised sector to help lift the tax to GDP ratio from current levels.

“Everywhere we can find them, we’ll catch them,” he said, citing as example a popular roadside café near New Delhi, which he said had annual revenues of around £100,000 to £150,000 but paid no taxes. “We have to be responsible stewards for India’s finances.”

The introduction of a Goods and Services Tax, which the government remains committed to introducing by April 1, 2016, would be a “massive boost” to the economy. “We expect it to add a percentage or so to growth rates, bringing down costs for consumers, and increasing tax revenue. It’s a huge windfall for the Indian economy if we can get it done as soon as possible.” Other pillars of the growth strategy include achieving higher agricultural productivity, the Make in India drive, pushing employability and skills development and urbanisation.

Quizzed by participants about the government’s tax regime, including those involving foreign corporates, Sinha defended the government’s record.

“India’s economic interest was deeply damaged by the retroactive legislation introduced by the previous government. Our government has given assurances in Parliament that going forward we will not create any more retrospective tax liabilities but on legacy issues we have to let them be resolved through the judicial route.”

“Tax authorities have got message loud and clear. They want to be perceived as being fair and transparent. We are all on same page as far as they are concerned.”

He also pointed the government’s drive for competitive federalism, encouraging States to compete with each other for attracting investments.

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