Relax entry norms for MNCs to boost growth: Jaitley

There is a need to smoothen the path for entry of global corporates by relaxing norms and ensuring stability in taxation policies if India is to sustain high growth and eradicate poverty, finance minister Arun Jaitley said today.

"Best response to poverty eradication is high growth rate. Sluggish economy cannot eradicate poverty. It can only distribute poverty", he said, while addressing convocation of Management Development Institute (MDI) on the outskirts of national capital.

The minister said the entry of multinational corporations is key to promoting economic growth, which is essential for creating jobs and raising the resources of the government.

"We have to make entry point into India easier for large global corporations to grow, for large Indian corporations to become global. We have to ease the process of doing business", the minister said.

The ease of doing business, stability of policy, maturity of political decision makers and following the correct process for decision-making are crucial to facilitating investments, he said, adding that failure to reach correct decisions would only create hurdles to both investor and the policy makers.

"We have to become globally competitive. The economy is likely to grow at 7.4 per cent in the current financial year and is expected to accelerate to 8-8.5 per cent in the next financial year beginning April 1", he said.

The NDA government had announced a host of steps to boost growth and improve ease of doing business. The government had earlier relaxed foreign investment norms in various sectors, including insurance and defence.

Jaitley said the revenues generated by businesses permeate the economy through corporate tax, excise duties etc as these revenues help the government find resources for undertaking social security programmes.

"India does not need a sluggish but active economy, a profitable economy where the revenues of the government are so large that it can actually bring up the standard of living of poor. The best response to poverty eradication is high growth rate. It enables the state to pull up (the standard of living of) the poor. It enables a state to have sufficient resources to feed the poor," he said.

The world doesn't look at obsolete societies, the minister said.

"They (MNCs) look at futuristic society and it is that process which is going to generate more jobs...going to help us in giving jobs to our weaker sections," he said, adding, it will "create a different India which should not be entirely dependent on government".

"It's an India where everyone must get an opportunity to grow. It's an India where the world must look at us as an ideal centre of investment, as a high return giving point of investment. We have to break away from the past...where our own entrepreneurs look elsewhere", the minister said.