FM: Ghost of GAAR buried, investors showing interest
The message, finance ministry officials hoped will also convince the global rating agencies to not only maintain India’s investment status but also to push it up soon.
The minister also said India has buried the “ghost” of GAAR the general anti-avoidance rules in tax policies that had led to a short term flight of capital from the country.
Chidambaram asserted that there is no threat of a rating downgrade in view of key economic decisions like allowing FDI in multi-brand retail and hiking of fuel prices including diesel.
“I must get more and more people into tax net, even if they pay small amount of taxes. More and more people must pay tax,” he told reporters after addressing an investors conference. According to him the fiscal deficit will be contained within the targeted 5.3 per cent of the GDP this fiscal and trimmed to 4.8 per cent in the next.
Growth which is likely to end this fiscal with a 5.7 per cent rate is expected to climb to 6-7 per cent in the next fiscal, he said.
The investors meeting ‘India for Investment’, which was closed to the media was hosted by Citibank and BNP Paribas. After the meeting a note issued by Citibank said the finance minister had told investors that his tax regime would be stable.