Don’t violate spirit of law: Piyush Goyal tells India Inc and the big four audit companies
Goyal advised lawyers as well as consultancy and audit firms not to misguide investors.
In an interaction with members of industry body Confederation of Indian Industry (CII) on Friday, Goyal also advised lawyers as well as consultancy and audit firms not to misguide investors.
Citing the example of foreign direct investment (FDI) norms in the multi-brand retail sector, the minister said companies should respect the law and not try to circumvent them by finding loopholes. The government allows 51% FDI in multibrand retail but bars foreign investment in the inventory-based model or multi-brand retailing. “We stand by that and we are firm on that, and I would urge everybody to follow that, to respect that. The moment you recognise that reality and make your business accordingly, there will be no problem,” he said.
Goyal’s statement assumes significance in the wake of concerns raised by the government about ecommerce platforms circumventing FDI norms. “If there are any lawyer in the room, please pardon me and if there are those four ‘bigs’ in the room, double pardon me, but please stop giving advise which is not in the spirit of the law that is prevalent in India,” he said, and told them to not try to misguide any investor into finding loopholes to circumvent the norms.
“Go by the spirit of the law. Spirit of the law takes round-tripping very seriously…Don’t try to evade law of land,” he said.
He told Parliament that a group has been constituted under the secretary of the Department for Promotion of Industry and Internal Trade for ensuring inter-ministerial coordination on resolving e-commerce issues as the government work to finalise a national policy on e-commerce.
EXPORTS AND MANUFACTURING
Goyal raised the issue of some “onerous” clauses in India’s free-trade agreement with Asean (Association of South East Asian Nations) and said he had flagged these with the 10-member bloc.
To boost manufacturing, the minister said he has asked the Department for Promotion of Industry and Internal Trade (DPIIT) to identify 50 sectors and work on those. He also asked the industry and exporters not do depend too much on government subsidies and instead focus on improving competitiveness and quality of products.
GSP WITHDRAWAL IMPACT
India exported goods worth $6.3 billion to the US in 2018 under the Generalised System of Preferences (GSP) programme, which it terminated from June 5. The impact of the withdrawal of the incentives will vary across products, Goyal said.
“The total duty concessions accruing on account of the GSP were $240 million in 2018, which was about 3.8 % of the value of India's exports to the US availing GSP benefits in 2018,” he said in a written reply to the Rajya Sabha.
India is a beneficiary of the GSP provided by Armenia, Australia, the European Union, Japan, Kazakhstan, New Zealand, Norway, Russia, Switzerland and Turkey.
The US did not accede to India's request for withdrawal of duties imposed on certain steel and aluminium products, Goyal said in a separate reply.
Goyal asserted that India is well placed to handle the “crossfire” resulting from the trade war between the US and China.