Ahead of the Union Budget 2022-23, Indian industry has urged the government to offer incentives for creating jobs, including special sops under the Production Linked Incentive (PLI) schemes already announced.
The plea assumes significance amid growing concerns about high unemployment levels in the country, even as a FICCI survey of manufacturing firms showed that 75% of firms don’t plan to hire in this quarter despite a marked increase in business volumes and orders in the October to December 2021 quarter.
“With the imperative to support jobs and create new employment as the country recovers from the pandemic, the Confederation of Indian Industry (CII) suggests that the Budget add a job-creation component to the PLI incentives for 13 sectors,” the industry chamber’s director general Chandrajit Banerjee said.
CII has also argued for raising outlays on the MGNREGS to help rural unemployed workers hit by the COVID-19 pandemic and spur consumption. It has also mooted a hike in the ₹25,000 monthly wages ceiling under the Income Tax Act for granting benefits to firms hiring new workers.
Separately, FICCI’s latest quarterly survey of the manufacturing sector revealed that average capacity utilisation was in the range of 65%-70% in the third quarter of 2021-22, but firms’ outlook towards hiring remained ‘subdued’ with three of four firms not looking to hire in the current quarter.
“The cost of doing business remains a cause for concern (with) high raw material prices, cost of finance, uncertainty of demand, shortage of working capital and logistics costs, combined with low domestic and global demand due to supply chain disruptions,” the survey found, adding that large volumes of cheap imports and high power tariffs are further constraining business expansion plans.