Encouraged by focus of budget on measures to increase integration into global value chains: USIBC

Washington, Encouraged by the budget on measures to increase integration into global value chains, the US India Business Council on Tuesday lauded the ambitious Union Budget as a key step in strengthening its global leadership in the Indo-Pacific and across the world.

“USIBC is eager to work closely with the Government of India to help it realize the full potential of Viksit Bharat, and we laud the Government’s ambitious Union Budget 2024 as a key step in strengthening its global leadership in the Indo-Pacific and across the world as well as ushering new opportunities for partnership and collaboration between the United States and India, the world’s oldest and largest democracies,” USIBC president Atul Keshap said.

Several of the budget’s economic measures are likely to have important strategic impact in areas of shared priority between India and the US where USIBC has been a key partner to both governments, he said.

“Abolishing the angel tax clears an obstacle to ever closer bilateral technology cooperation and innovation – a key focus of the Innovation Handshake, a government-led initiative which USIBC has played a foundational role in. The proposed venture capital fund for space start-ups and sustainability focused priorities such as the critical minerals mission, storage solutions for renewable energy, and interest in rooftop solar and small modular reactors support central priorities of the Initiative on Critical and Emerging Technologies,” Keshap said.

Congratulating Finance Minister Nirmala Sitharaman on presenting a jobs-focused, inclusive and prudent Union Budget that provides critical support for the strategic partnership between India and the United States, Keshap said this post-election statement of the new government’s priorities builds on important progress made in the past five years to promote India’s sustainable growth and development.

“We commend the introduction of significant initiatives focused on employment, skilling, MSMEs and the middle class, all of which should help continue the country’s impressive economic expansion and broadly share its benefits. The budget’s investment in human capital and infrastructure, reduction in tariffs and duties, and sustained fiscal consolidation will boost India’s competitiveness — an essential element to achieving developed country status,” he said.

"We are very encouraged by the budget’s focus on measures to increase India’s integration into global value chains. The reduction in basic customs duty on mobile phones, assembled printed circuit boards and chargers, as well as phased adjustments on the duty applicable to medical equipment and full customs duty exemption on select cancer medicine will expand electronics manufacturing, enhance output in the life sciences sector and, most importantly, save lives,” he said.

Developing more investment-ready industrial parks across the country while also delivering on a promise to streamline foreign direct investment rules will put India in a position to fully reap the benefits of these changes and impact all sectors. Investments to increase capacity for food quality and safety testing will strengthen India’s status as an agricultural export powerhouse, he added.

“The broad contours of the proposed tax changes are promising, and we hope that these reforms will help usher significant foreign investment into India. Expanding safe harbor rules, streamlining transfer pricing assessment procedures, providing more resources to accelerate dispute resolution, and reducing the differential taxation levels between international and domestic companies are critical steps forward with the potential to greatly ease doing business for global players. Focused measures for faster and more effective debt recovery and insolvency processes, including additional tribunals for debt recovery, will strengthen the overall financial ecosystem. The proposed legislative approvals for pooled funds of private equity should make cross-border investments more attractive,” Keshap said.

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