Dearest Prime Minister,
We are very happy that we have a very hard working Prime Minister. Your achievements do not require certification from anyone. It is already reflected in the Loksabha election wherein you got a thumping majority. We, the people have given a huge mandate because we have huge expectations too.
Today I would like to highlight few sensitive things which are to be taken care of by your government. Although you have carried out many good initiatives which no other government has ever thought of doing, there must be certain things pushing economy down.
The most important factor which your government lacks is TRUST. You do not trust the people at all, the same people trust you to the core and hence you have such a huge mandate. Following are the key areas where lack of trust is reflected tremendously.
GST:
GST is still in the initial stage. Your government is coming up with a lot of changes every now and then. Before someone understands a particular thing, it gets changed. Even your own department is clueless about it. They have made blunders that are to be rectified and hence the law has become so volatile. People also take time to understand the law and they may make mistakes while reading between the lines. Obviously, there are fraudsters too who penetrate the system and abuse it for their own undue benefits.
But all are not frauds. You cannot be harsh to everyone for a few people’s sins.
The 10% GST input credit restriction is illogical and has many deficiencies in itself. This draconian provision is killing small businesses with a working capital crunch. Small businesses are the backbone of our economy. They don’t have much capital and you are squeezing them on the top of it.
Your department is very very slow in giving refund to exporters. They face breathing problems due to the unavailability of funds and end up losing a lot of business. In turn, our country loses a lot of foreign currency businesses leading to the current account deficit. Even refund in case of an inverted duty structure is also time-consuming. Corruption is another issue in this refund process.
I feel let people feel ease of doing business. Give them enough freedom. You have all data in digital form and data analytics tools too. Get the kundalini of fraudsters, take harsh actions, and set an example. Don’t punish all.
Liquidity in financial sector:
For last couple of years, frauds in financial sectors are in the spree. People in financial sectors are scared to give finance. Especially, PSU banks are not willing to offer helping hand to entrepreneurs due to high vigilance by the government after the NPA debacle. NBFCs are dried and unable to survive. Even private banks and co-operative banks have suffered a lot. All these have created panic in the financial sector and they are less encouraged to finance.
Without the oxygen i.e. finance, even big players have put capital expansion plans on shelf. Small players are facing survival issues. Your government has to create positive vibes and encourage financial sector players to infuse liquidity in the market. Availability of Liquidity will create a very good environment and businesses will be shooting up.
You have SARFEISI, IBC, PMLA, etc. laws to punish the fraudsters. You may scare them when caught. But creating a negative environment for all will only deter the economy.
The only thing I want to highlight here is to create a positive environment and to trust the people of our diversified yet united and tolerant country. This will help us to achieve the goal to make India a 5 trillion Dollar economy. This is the ease of doing business in true sense.
Jai Hind.
Regards,
Your admirer and well-wisher.
CAclubindia
