[gallery size="medium" td_select_gallery_slide="slide" td_gallery_title_input="Investment-friendly Indian budget lauded" ids="122262,122263,122264,122265,122266,122267,122268,122269,122270"] INDIAN Consul General Md. Noor Rahman Sheikh, while inaugurating the recent session on Indian Budget 2017-Advantage Investment at the consulate premises, highlighted the advantages to Foreign Direct Investors and the extension of favorable tax to foreign investors by three more years until June 2020 to a elite audience that had Saudis and Indians. Saudi Indian Business Network (SIBN) organized the event in association with Consulate General of India and Institute of Chartered Accountants, Jeddah Chapter. CA Vijay Soni, treasurer of SIBN and president IMA, Jeddah, arranged vibrant speakers from India and a CA panel from Jeddah for the presentations and panel discussion. Sheikh, while stressing the fact that the budget's thrust was on investments in India, separated the wheat from the chaff with his succinct assessment on the budget's implication on investments. In addition to the earlier reliefs, Sheikh emphasized on the abolition of FIPB, which is good news for foreign Investors. He commended that the budget is growth oriented and historical in many ways. "This is the first time that the budget has been unified and brought forward to Feb. 1 so that schemes can be implemented before the onset of the monsoon. The very fact that there were two sets of budgets — the railways before the general budget, and have been unified in this exercise provides for ample time for the government to act," Sheikh said in his address, while deferring to the experts on the nitty-gritty of the budget. "As for the specifics of the budget the experts are here to highlight for us various areas of investment and relief offered. With the increase in foreign reserves, the finance minister has moved his focus on investments with India presenting a bright scope in the world with a growing economy and supports its business entities, especially with the cut from 30 % to 20 % in tax rates for SMEs in thus budget being a welcoming aspect," Sheikh added. "We need to share this with our Saudi friends, and showing them the opportunities to invest in this sector would be a great thing. India presents a positive climate for investments... my consular and commercial sections are always open to assist Saudi investors and there is always the SIBN team who can help in the areas of investments," Sheikh said. "The government has opened up avenues to make investments easy in India and this budget has enabled a rate revision that is helpful for businesses. The thrust of the government is to make it more transparent, to show to the world that you can invest in India and the investors would benefit from it, Sheikh added. The budget session was attended by Mohammed Shahid Alam (deputy consul general and consul Haj), Anand Kumar (consul consular), Moin Akthar (consul community welfare & admin), SIBN/JCICAI members and Saudis and Indians from many walks of life. There were four presentations, one by local speaker and three from overseas Indian speakers through video conferencing. This was followed by a panel discussion headed by Sheikh and other panel members CA Sreekanth A.S., CA Omar Saraswala, Dr. Ravish Tatli, Rahul Goswami (legal consultant), Anindya, Sheikh Ibrahim Al Aseeri (international businessman, chairman - Muwazy Co. and Enfath Group). Soni moderated the session. Soni in his opening remarks stressed on the challenges of the year 2016 — a year of financial happenings. "It necessitated realignment in strategies for future regional and financial outlook. Like Vision 2030, Indian government has been a front runner to address current challenges and opportunities for global investors focused to transparency and digital era of reforms," Soni said, adding, "Indian budget-2017 highlights new domain of opportunities for investors looking East with higher and safe returns." Dr. Mohammed Nurul Hasan (consul commerce) welcomed the guests. He also briefed all on SIBN and the commercial section's efforts in promoting bilateral trade between Saudi Arabia and India. CA Sreekanth A.S. made a brief presentation about the budget and explained the three major reforms of the budget, the ten themes of budget and taxation. He explained, "Deemed income will be calculated at the rate of 6% of turnover for small business having turnover of up to Rs.20 million in place of 8% for non-cash transactions. It is one of incentive for going digital," he said. CA Nilesh Vikamsey, vice president ICAI, CA Amarjit Chopra – past president ICAI and CA Sanjay Jhanwar, managing partner of Chir Amrit Legal LLP, spoke to the audience through video conferencing. Vikamsey was elected president the very next day of this event. He shed light on the Institute of Chartered Accountants of India, calling it as one of largest, prestigious accounting body in the world having 800,000 members and students. "CA is one of the most regarded qualification in the world of finance and accounting," Vikamsey said in his introductory address while appreciating and thanking Sheikh for organizing the event in coordination with SIBN, JCICAI and IMA. He also recognized Soni and other CA colleagues' effort in bringing the knowledge pool to Saudi Arabia. "India is already a front runner on various taxations reform and rule simplification; GST will be a game changer in India while consolidating various indirect taxes making it easy for business community," he added. "Demonetization is one of the courageous decision and there is no parallel incidence of this magnitude anywhere in the world for this is a key step towards digital economy; the railways are to move away from cash accounting to accrual accounting — bringing accountability and transparency and insolvency laws has been passed by the government helping companies to decide on the exit plan and ease of doing business," Vikamsey said. CA Amarjit Chopra commended the wonderful job being done by the CA fraternity and underlined the ICAI's role in nation building — as an independent accounting body — since 1949. He said, "The current budget has given high importance to agriculture, infrastructure, real estate, and creation of employment while the holding period for long term capital gain cut from 36 months to 24 months will help the assesses." "The budget focuses on issues like corruption, black money etc., and is trying to address the NPA's (non-performing assets) of banks both in private and public sectors through additional capital injunction and raising the provision in the banks books against NPA from 7.5% to 8.5%," he said, adding, "The amount being introduced is too less compared to the actual requirement. Post demonetization, the banks are flooded with deposits hence credit offtake needs to be increased to stimulate further growth to the economy." "The move away from plan and non-plan expenditure in the budget to revenue and capital expenditure will for the first time help in ascertaining the asset creation by the government, which has not happened since 1947 and this will bring more transparency and accountability and the reduction of corporate tax by 5% will be beneficial to majority of companies," Chopra said. CA Sanjay Jhanwar explained to the audience the relevant tax and investment advantage policies for Saudi Arabia. He highlighted the economic disparity, which showed only negligible percentage of population filing and paying income tax while other economic indicators like owning of cars, air travel etc., showed that large parts of the population are out of the ambit of Income tax. "Demonetization to some extent has enabled the government to increase the tax base and bring the informal economy into the formal fold proving beneficial to the country as it enhances the tax base and also helps foreign investors as they know the strength of the economy," he said. His take on the changes brought about in cash transactions beyond 3 lakhs, which attracts equal amount of penalty, was that it was a push towards digital economy. He also spoke about fiscal management, wherein the fiscal deficit over the years is showing a declining trend, and that's a good sign. He took the audience through various aspects of the economy through a series of some graphs showing that the GDP growth would be solid and that the economy will recover in this year post demonetization. He said, "Inflation is under control, tax collection is expected to rise from Rs.7.42 lakh crores in 2012-13 to Rs.10.54 in 17-18 though there have been tax rate cuts." "Because of the double taxation avoidance agreement between India and KSA, the Kingdom's resident will get favorable tax treatment on the Interest/Royalty income at the special rate of 10%. Further, the tax paid in India by Saudi companies / investors can be offset under zakat and income tax of Saudi Arabia and vice-versa," added Jhanwar. A panel discussion, moderated by Soni was held. The panel included Sheikh, Al Asiri, Saraswala, Dr. Ravish, Sreekanth, Goswami and Anindya in Jeddah and Jhanwar from India. The questions related to the opportunities for foreign direct investment in infrastructure due to increased allocation to this sector with a major allocation to transportation sector was discussed. This in turn would boost additional investment in tourism and hotel industry, which are interrelated. Saraswala pointed out opportunities for Indian accounting professional/firms in KSA as they are ahead of cycle in implementation of IFRS, VAT and GST regulations. Jhanwar explained the changes in housing sector and real estate and how it would benefit the investors wherein the tax liability will reduce and give impetus to real estate sector. Applicability of deemed rental income for builders will force players to be efficient and liquidate unsold inventory. To OCI Dr. Abdul Raheem question on putting charitable laboratories in India, the panel said, "Donations for charitable laboratories can be routed through eligible trusts compliant with FEMA regulations." Al Asiri asked, "How is India an attractive investment destination for Saudi businessmen" with few key takeaways from Anindya and other panelist: "Sheer size of the market GDP is close to $2.2 trillion as against $0.7 trillion of KSA. Further on PPP parameter India is the 3rd largest after US and China. The growth of Indian economy at 6.5-7% is significantly higher than other countries. Stability and consistency in fiscal and monetary policies that helps investor confidence; judiciary is strong – you can take anyone including the government to court for justice; socio political stability and no major civil upheaval leading to a stable business environment." On the current real estate situation, the pricing offers great opportunities in real estate as the growing population of 1.25 billion Indians are looking for more avenue of recreation, hotels and tourism apart from affordable housing and the growing need for healthcare industry. Krish Jangal, IT sectorial head of SIBN, was instrumental in connecting the overseas speakers from India through videoconference technology. Ajay Bhatt provided support. Deputy Consul General Alam congratulated the SIBN team on successfully organizing the program and added, "SIBN is blessed with visionary leadership of the consul general and the versatile knowledge prowess of its members" Consul Consular Kumar said, "SIBN has been working hard to enhance trade relations between the two countries and this event was aimed to motivate people to do more to facilitate greater bilateral investment opportunities." The Q&A session revealed good information about opportunities in India from CA Nadeem Bhamla, CA Huzefa, Noman Abdul Majeed, Dr. Abdul Raheem Moulana, Adil Sanai, and Shariq Ali. SIBN General Secretary Mir Gazanfar Ali Zaki delivered vote of thanks. "SIBN will continue to organize more informative and productive events in future for Saudi and Indian business community," he said, adding, "Programs on renewable energy at the end of this month and food festival of India and the Siasat Islamic Calligraphy event in the month of March." Mohammed Viquar Ahmed and Esa Bin Ayaz Shabibi, SIBN event management team, was well supported by Amjad Shareef and Bobby Mannat from Indian Consulate in organizing this program.
