Japan sends wish list for budget

New Delhi: Japanese companies which have a significant presence in India have given a wish list to the new government for the forthcoming budget which include raising FDI limit in insurance from 26 per cent to 49 per cent, improvement in business and employment visas procedures, and “Sogo Shosha” be treated as service providers.

Japan Chamber of Commerce and Industry in India(JCCII) has been submitting the suggestions to Indian government every year since 2009 and this is the sixth suggestions.

“The entire world is eagerly awaiting the revival of the Indian economy. It is in this context that Japan and its business community are anticipating at the earliest a strong and clear commitment to, and implementation of, reforms and economic revitalisation measures,” said JCCII.

The suggestions contain about 40 items in 11 chapters, tax system, banking sector, logistics and distribution, visa and infrastructure.

As per wish list, JCCII has demanded that Indian subsidiaries  of “Sogo Shosha” (which are integrated trading company that originated and are unique to Japan) should be recognised as service providers and not traders in the transfer price taxation. It said that basic custom duty on inverter component parts should be eliminated and treated as same as finished products of inverter. JCCII said that import duty for digital cameras should be maintained at zero per cent.

“Foreign banks should be allowed to open branch offices in the metropolitan area more liberally and promptly,” said JCCII. It said that liquidity coverage ratio (LCR) requirement under basel III should not be applied to a branch of foreign bank in India, but to the headquarter of foreign bank.

The Indian budget is expected to be presented in the first week of July. This would  be the first budget after the BJP led NDA and business friendly Prime Minister, Narendra Modi formed the government on May 16 in a historic win.