India being a developing nation undergoes continuous economic and financial changes every day. To monitor the growth, fetch recommendations and audit decisions and policies various committees are constituted to keep the economy on track. Let’s have a look at each of these Committees constitutes in 2019 in detail.
1. HLAG on Elephant Bonds
A High-Level Advisory Group (HLAG) headed by Surjit S Bhalla recently issued a suggestion to the Government of India to issue “Elephant Bonds” to help India recover up to $500 billion of black money stashed overseas.
What is Elephant Bond?
The elephant Bond is a proposed debt instrument that:
– Is a 25-year sovereign bond in which people declaring undisclosed income will be bound to invest 50 percent of that income in these bonds.
– is like an Amnesty scheme to help State treasury raise tax revenues, adding beneficiaries in tax base who have not declared their assets previously.
Key Recommendations of the Committee
– The funds raised through these bonds will solely be utilized for boosting economic growth by utilizing the collected money to fund infrastructure projects in the country.
– lowering the effective corporate tax rate and bringing down the cost of capital and simplifying regulatory.
– State governments need to be closely involved in improving the competitiveness of exports by providing support measures in a WTO (World Trade Organisation) consistent manner.
– The group recommended increasing the capital base of EXIM Bank by another Rs 20,000 crore by 2022, setting up of empowered investment promotion agency and seeking inputs from industry and MSMEs before signing free trade agreements (FTAs) and sensitizing them of its benefits.
– It also suggested separate regulations for medical devices and a single ministry for the sector.
– To promote tourism and medical value tourism, the group recommended simplification in the medical visa regime, setting up of a pan-India tourism board.
– For the textiles and garments sector, it suggested modification in labor laws (like the Industrial Disputes Act, 1947) to remove the limitation on firm size and allow manufacturing firms to grow.
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