Tamil Nadu has asked for policy corrections that are vital to carry forward the ‘Make in India’ campaign and more engagement with the States in formulating policy priorities.
At the first meeting of the Governing Council of the NITI Aayog at New Delhi, Tamil Nadu Chief Minister O. Panneerselvam raised some of the pertinent issues affecting the investment climate in the State.
In his speech, he said the retrospective amendments to the Income Tax Act in 2012 with effect from 1976 and levy of huge penalty on the world’s largest mobile handset manufacturing plant (Nokia) located in Tamil Nadu resulted in the closure of the unit.
Other handset manufacturers are willing to step in to open the unit and this has to be facilitated by lifting the assets-freeze imposed by the IT authorities. Besides, the domestic electronic hardware manufacture was at a tremendous disadvantage due to the inverted duty structure wherein the finished products could be imported duty free under the ITA agreement of 1998, while components are levied a duty.
Already 65 per cent of the domestic demand is met by imports and Indian electronics import bill is projected to exceed t he oil import bill by 2020, he said seeking policy corrections in this regard.
Welcoming the inclusion of Chief Ministers in the NITI Aayog, he said the views of the States need t o be heard at different levels in the hierarchy of the Aayog to make it a federally empowered institution. Otherwise, it would become a ritualistic exercise similar to National Development Council and Inter State Council in the past, he cautioned.
Mr. Panneerselvam also sought the overhauling of non-transparent, discretionary and uncertain fashion in which funds were allocated and disbursed to States by the erstwhile Planning Commission and Central Ministries in the past. After the abolition of Planning Commission, he asked the Centre to take the next logical step of substantially enhancing the Finance Commission based devolution.
The Chief Minister also sought an increase in Central subsidy for urban sanitation programmes; solid waste management projects and uniform subsidy for installation of micro irrigation systems. He also asked the Centre to step up the unit cost of Indira Awas Yojana houses to at least Rs. 2 lakh and sought support for the State’s initiative of constructing 50,000 homes in the LIG category to address the housing shortage in urban areas.
He also sought more desalination plants; smart city tag to all the 12 corporations and revisit of the approach to implementing Direct Benefits Transfer (DBT) schemes.
