Most of the investment in research and development across sectors has done by the public sector units so far and the private businesses too must increase its investment in the area, Prime Minister Narendra Modi said on Saturday while addressing the virtual keynote address of Associated Chambers of Commerce and Industry of India’s (ASSOCHAM’s) ongoing foundation week.
“The investment being done in research and development (R&D) is also an important aspect. There is a need to increase the investment in R&D. In countries like the US, the private sector invests about 70 per cent of the total investment done on R&D, in India, the same is done by the public sector. In this too, a big part is done in IT (information technology), pharma and transport sector,” Modi said in his address, adding that it was the need of the hour that private sector in India must step up its investment in R&D.
The funds by the private sector should also be kept aside for newer sectors such as agriculture, defence, space, energy, and construction, the Prime Minister said.
During the event, Modi also said that in the past six years, the global perception had changed from being a “why India” to “why not India” country.
“There was a situation in the past when investors would question ‘why India’ (for investing in the country). With reforms (of past six years) and their effects, its proposition has changed to ‘why not India’,” Modi said.
Citing that India had in the last six years scrapped about “1,500 old and obsolete laws” and was framing new ones which would be in tune with the requirements of the times, Modi said that easing compliance burden in the new labour laws have made investors turn their investments towards the country.
“From a non-existent culture for innovation to a new ecosystem promoting and nurturing startups has given the world confidence to say ‘why not India’. Today the faith reposed by the government in the private sector and encouragement of foreign investors have made the same people say ‘why not India’,” the prime minister said.
As a part of its efforts to improve ease of doing business, the government has, among others, been decriminalising several provisions of the Companies Act, which earlier had very stringent measures for small violations.
The move has been part of larger government efforts to boost ease of doing business since 2018. The recently decriminalised offences include administrative offences such as delays in filing CSR reports, or failure to rectify the register of members in compliance with orders from the NCLT. Experts point out that the decriminalisation efforts are really an effort to pull back on regulations introduced in 2014 aimed at boosting corporate compliance.
Further, the government last year trimmed the headline corporate tax rate to 22 per cent from 30 per cent, and to 15 per cent from 25 per cent for new manufacturing companies as measures to boost ease of doing business.
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