Conversation with Senior Economist, Standard Chartered
During a conversation with Economy.lk, Standard Chartered Bank Senior Economist in South Asia, Standard Chartered Saurav Anand opined that the global economic dynamics requires one to be deft and nimble with regards to policy making, yet that does not deem long term economic planning irrelevant.
Anand noted that in the face of global economic volatility and complex dynamics, businesses need long term government roadmap to plan their investments.
“For example, a government roadmap to reduce the corporate tax rate from 30% to 25% in the next five years will help corporate planning and investments,” he explained.
Relating the experience of Indian government in economic planning related to the introduction of Goods and Services Tax (GST), he noted that it was ensured that economic policy changes were business friendly and the issues raised by the business sector were taken into consideration.
“GST was a major tax overhaul and teething issues came about once it went online. This was not unexpected given the diversity and size of India system. However, the government has responded to the criticism and issues deftly. Several channels were opened to hear business feedback on GST and the issues were taken up proactively by the GST Council (the apex decision making body). In fact, some GST Council meet was proponed by nearly 20 days (from the scheduled date) to address the business concerns. Rules were amended (and are still being amended) to make the whole process business friendly. Tax rates were changed wherever it was realized and deadlines to file tax returns were extended to help businesses cope up with the new system,” He noted.
He further added that in India, while it is important to build consensus not all policy making have been on consensus whether it be bank recapitalization or demonetization. He opined that for economic planning to be succeeded, any government should stick with its reform agendas despite opposition.