Ahead of the 2015-16 Indian budget, finance minister Arun Jaitly convened a meeting to address the concerns of Foreign Institutional Investors (FIIs). The meeting was attended by Prime Minister Narendra Modi, Reserve Bank of India Governor Raghuram Rajan, and Securities and Exchange Board of India Chairman U. K. Sinha along with officials from KKR & Co., Duetsche Bank, and Merrill Lynch.
Business Standard reports that the issue discussed the most was the General Anti Avoidance Rules, with FIIs pressing their scheduled roll out in April be deferred. If this wasn’t the case, the foreign investment community should be exempted from their applicability, the investors said.
The investors enunciated the need for clarity on royalty payments for information technology companies; taxes on advertisement and promotional expenses as part of branding; demand for 10 per cent upfront payment of tax before a case went into litigation; and show-cause notices on Minimum Alternate Tax.
Initiatives to boost ‘ease of doing business’ in India and reduce paperwork were also discussed. Rajan exhorted FIIs to invest in the corporate bond market for longer periods.
