Aviation Industry“India allows 100% foreign direct investment in almost all mass rapid transport systems, ports and harbors, inland water and ocean transport, and toll roads and tunnels. However, in contrast to this, the foreign ownership in airlines is restricted to 49% and no investment in the Indian carriers. This restriction limits the resources and could lead to an investment gap. Therefore the government should look at liberalization of FDI in aviation. Recognizing that aviation today is an important element of infrastructure, rapid upgradation of airport infrastructure is the need of the hour. Also, regional aviation needs to be promoted aggressively. A lot of airlines are ready to take off their regional carriers from many parts of the country, but lack of developed airports is blocking the growth. Also, the ATF prices have been further hiked by 4.5%, putting more pressure on the airlines, resulting increase in the airfare. We hope the government terms ATF as ‘declared goods’, as it will help in reducing the Sales Tax rates from the current levels of around 24-25%.”
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Tourism & Hospitality Industry
ReplyDelete“Tourism industry in India has a major impact on the economic set up of the country. With the highest 10-year growth potential, it has been forecasted that India’s share in global tourism is expected to reach 1.5% in the coming years and a 10-11% growth is expected in the sector, this year.
While the possibilities for growth are immense, it will take an earnest effort, both from the industry's key stakeholders in the private sector and the relevant government bodies to truly change the Indian tourism’s landscape in the years ahead. High cost of land in the country often discourages an investor to put in money in construction of new hotels. There is an urgent need for infrastructure improvement in Indian cities and towns. Secondly, multiplicity of taxes like value added tax and service tax further compound the problem.”
Luxury Retail Industry
“The last couple of years have seen a profusion of luxury brands into the Indian market. From standalone stores in five star hotels to luxury Malls, labels which were previously seen in international fashion magazines and high streets abroad, are now household names in India. With one of the highest levels of disposable incomes, the well-traveled Indian luxury consumer is being wooed by all.
However, the reason for slow growth of retail in India is due to factors like the high cost of real estate and the multiple and complex taxation system. The sales tax rates vary from state to state. While organized players have to face a multiple point control and tax system, there is considerable sales tax evasion by small stores. In many locations, retailers have to face a multi point octroi.
We hope the government looks at opening the FDI in retail industry with investments by investors such as FIIs, Venture Capital Funds and other financial investors in the sector. Also, we hope that the import duty could be removed and GST could be introduced, which will help streamlining the taxes.”