Industry chambers, in a pre-Budget meeting with the Finance Minister Pranab Mukherjee, sought fiscal sops to boost corporate investments.
In their respective memorandums, the Federation of Indian Chambers of Commerce and the Confederation of Indian Industry asked for re-introduction of investment allowance, restoring the depreciation rate to 25 per cent and an increase in plan public expenditures, primarily in infrastructure, which would boost private investments.
"We need an investment-led Budget. Investments are needed in infrastructure. This money could be raised through disinvestment, targeted reduction of subsidies and implementation of the Administrative Reforms Commission recommendations. By these measures, we should be able to bring fiscal deficit down, so that there is money available for infrastructure," said CII President Venu Srinivasan after the meeting.
Industry leaders who attended the meeting included L&T Chairman and MD A M Naik, Bharti Enterprises Chairman Sunil Mittal and Videocon Chairman and CEO Venugopal Dhoot.
"I suggested measures to boost infrastructure, as well as exports," Naik said after the meeting.
Various other fiscal measures were suggested, which included reduction of corporate tax, increasing tax exemption limit for personal tax and abolishing fringe benefit tax (FBT).
"We have to increase demand in India for the normal consumer. We have to put money into the hands of ordinary citizens. Only way you can do that is by reducing personal income tax burden," said Assocham Senior Vice President Swati Piramal.
CII did not recommend a reduction in actual corporate tax rate, but suggested removal of surcharge and cess. Ficci suggested bringing down corporate tax by a few percentage points, though it did not come up with an exact figure.
Both chambers stressed on the need to increase exemption limit for personal tax .CII suggested an increase by Rs 50,000, which would have positive impacts on savings and consumption.
CII suggested no major change in indirect taxes, apart from a percentage point decrease in central sales tax (CST) to 1 per cent.
Even as India Inc lobbied for fiscal sops in the forthcoming Budget, representatives from India's farm sector, which accounts for 16 per cent of Gross Domestic Product, demanded pro-reform policy to boost agricultural production.
They wanted to remove restrictions on foreign direct investment for farm sector as well as commodities trading.
"Yes, some of us suggested that FDI should be allowed in agriculture. We need investment in technology and machinery to ensure that agriculture becomes internationally competitive and you cannot do it with things like bullock carts which are 2,000 years old. Indian industrialists and consumers have come of age. Today no one can exploit anyone," P Chengal Reddy, secretary general, Consortium of Indian Farmers Association, told reporters after meeting the finance minister.
Saying market freedom both in terms of imports and exports are essential for farmers to get better prices, Sharad Joshi, a farmer leader from Maharashtra and a Rajya Sabha member, said "If we have futures market farmers will get same benefit as the industry got from stock market. This will also cure problem regarding investment in agriculture."
Another area which the representatives focused was on investments. "If we need 4 per cent growth in agri-sector, substantial investment has to be made in areas like water management, research and development and watershed development. Otherwise, 4 per cent agricultural growth will remain a dream. Agriculture should not be just looked at in terms of farming. It has to be linked to food processing and retailing," said Ashok Gulati, Director (Asia), International Food Policy Research Institute, a Washington-based think tank seeking working on world wide hunger elimination.