K Shanker – Head, Onshore & Overseas Business, Technip India Ltd.
Our wish lists for the coming Union budget are the following:
We would like to see more transparency in the Transfer pricing which will attract and encourage more investments inflow from MNC’s into India. This is important as many countries apply their own variations of the Arm’s Length Principle (ALP) in their transfer pricing regulations. Transfer pricing is critical for MNCs as it directly influences how taxable income is distributed among different countries having various tax rates, thus impacting after tax free cash flow. We need a more transparent and simplified process in place.
We need favourable policy framework which will be conducive for the production of Engineering equipment and EPC industry products manufactured in India. This would be in line with ‘Make in India’ campaign initiated by our Prime Minister Shri. Narendra Modi. Attractive incentive structure for capital investment will encourage and see the growth of home grown companies and entrepreneurs in India.
In order to create large scale employment opportunity and to give a fillip to industry growth, the government should focus on making PCPIR into a reality. Conceptually PCPIR, a specifically delineated Investment Region planned for the establishment of production facilities for petroleum, chemicals and petrochemicals, is a great initiative to promote the energy sector in India but we are yet to see a full scale implementation of this.
The government should look at a market driven long term gas policy as it will help in stabilizing gas prices over the long term. There is a serious concern as to the dip in oil prices worldwide. We have to wait and watch how this would stabilize before we could plan for any eventuality. These are the phases in industry circle but yes, oil price drop had an immediate effect on the upstream industry and as a result couple of projects being kept on hold for the time being.
There should be a favourable environment to revive the Fertilizer sector investment to bridge the gap between supply and demand through domestic production.