New Delhi, July 4 (KNN) The Federation of Telangana Chambers of Commerce and Industry (FTCCI) has sought 2% interest subvention for Micro Small and Medium Enterprises in Union Budget 2019.

Towards reviving the MSME growtpstomin-msme@nic.inh and reducing their financial stress, such enterprises may be offered 2% interest subvention on loans up to Rs 5 crore and direct tax concession, said Arun Luharuka, President of FTCCI.

The federation expected the government to announce concrete measures to boost growth and achieve 8-10% growth rate.

It stated “Government should focus on creating more jobs and that should be the focus of investment also. The organized sector does not create much employment due to rising automation. For instance, modern organized construction creates few jobs. Large numbers of jobs are created in education, health, small irrigation, rural infrastructure like telecom and roads. So, the need is to invest in these areas.

To encourage higher investment into the equity market by private sector, the tax incidence on equity investors need to be reduced, demanded FTCCI.

In the present scenario a large number of companies pay an extremely high corporate tax at over 34 percent. A simplified and reasonable tax rate regime is required to raise the investment, he added.

President of the Federation said “The ongoing US-China trade war has opened up new avenues for India to become a potent exporter to both of these countries and the Budget should and must focus on it.”

The major obstacle in increasing labor intensity in manufacturing has been the stringent labor laws. A flexible and liberal exit policy for the industry will help in improving the investment in manufacturing sector more particularly in MSMEs.

The budget is expected to address the stressed assets problem within banks and NBFCs, as this is acting as a big constraint to revive the investment.