India may have done away with the License Raj decades ago, but Adi Godrej, chairman of the Godrej Group, said there are still too many permissions needed to do business in the country, which need to be done away with.
"We have too many permissions required in this country. Doing away with permissions in lot of sectors would make a lot of sense. For example, the kind of permissions you need in our country for building housing is ridiculously high and those policies are changed while projects are going on. So, we should pay a lot of attention to not having too many controls and this is something we should compare ourselves to with other countries," said Godrej.
The noted industrialist, who was speaking at the Economist India Summit at Mumbai on Thursday, also, once again, called for lower taxation, which, he said, helps in higher tax collection and, in turn, higher growth.
"We need to have a tax system that is optimal. Today, our corporate tax rates are some of the highest in the world among the large countries," said Godrej.
The government in the budget did cut corporate tax rates, but it was only for small companies. According to Godrej, while Finance Minister Arun Jaitley "cleverly" said that it will cover 99 per cent of companies, it covers only five per cent of the corporate tax payments.
India is among the fastest-growing large economies in the world, but Godrej said there needs to be a focus on social development, too.
"Merely economic development with social development will not take us far. It is very important that we pay a lot of attention to social development, and the combination of good social development and economic development can, in fact, make us a much better country," Godrej noted.
Godrej also talked on employment generation in the country and pointed to "acute shortage" of professionals in fields like judiciary, teachers, doctors and nurses, and he stressed on training these categories and not just aim to create an industrial workforce.
Godrej felt it was high time economic growth is measured on the basis of Purchasing Power Parity (PPP) as it will be a better monitor of the state of the economy. He believes India has the potential to become the largest economy on PPP terms by 2050.
