The Hindu : Chamber against populist steps

Online edition of India's National Newspaper
Sunday, Mar 02, 2003

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Chamber against populist steps

By Our Staff Reporter

NEW DELHI MARCH 1. Populist measures like subsidies should be done away with and all public utilities must be run on the principle of "user pays'', the PHD Chamber of Commerce and Industry said today.

At a meeting with the Delhi Finance Minister, Mahinder Singh Saathi, the PHDCCI advocated that there should not be any cross- subsidisation, particularly one that would harm the interest of trade and industry. Subsidies to the vital sectors of education, transport and nutrition need to be reviewed in totality.

The Chamber has emphasised the need for prudent fiscal management through reduction in non-Plan expenditure, rightsizing the Government set-up, reduction in multiple layers in decision- making and introduction of pension reforms. The Delhi Government, it said, should encourage private sector participation in the areas of solid waste management, water supply projects, maintenance of industrial areas, development and maintenance of parking and outsourcing services for collection of user charges. For public-private partnership in solid waste management, the Chamber sought budgetary support by way of incentives for technology collaboration, subsidy schemes for compositing, transporting and energy recovery and tax rebates.

Expressing concern over the high rate of stamp duty in Delhi, it has called for a reduction from 13 per cent to between 5 and 7 per cent. Such a move, it added, would increase compliance and enhance revenue from stamp duty.

The Chamber has sought review of the urban land policy for allowing bulk provision of land to developers and suggested that the categorisation of industrial and commercial areas be different from the residential ones, levy of property tax should ensure a better quality of civic services and specific performance parameters should be laid down for ensuring better accountability of the Municipal Corporation of Delhi.

As for the tourism sector, the PHDCCI has called upon the Delhi Government to reduce sales tax on aviation turbine fuel from 20 per cent to a uniform rate of 10 per cent to facilitate bringing down domestic fares. It was recommended that in the forthcoming budget, the luxury tax on hotels should be reduced to 5 per cent. Also, the tourism budget should be substantially enhanced from the current low level of Rs 3.25 crores.

According to the Chamber, the Delhi Government needs to pay urgent attention towards better upkeep of the approved industrial areas. To further reduce pollution levels, it was suggested that natural gas supply be made available to industrial area for industrial consumption.

The PHDCCI underlined the development opportunities for commercialisation along Metro corridors.

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