The Interactive Session was addressed by Dr. Narendra Jadhav, Member, Planning Commission, Government of India.

Mr. Narendra Jadhav, Member, Planning Commission in his remark presented a balance-sheet of the achievements and failures since liberalization was ushered in and sought to set the targets on achieving which the nation will become an economic powerhouse. While foreign exchange reserves had plummeted in 1991 and there was economic gloom all around, a judicious mixture of liberalization, privatization and globalization (LPG) ensured sharp economic growth.

Making no bones about the dismal state of education in the country, Dr. Narendra Jadhav called for a complete overhaul of the sector to address crucial deficiencies that have marred the implementation of governmental schemes. Dr. Jadhav said, “During our review of educational schemes, there are serious concerns about quality that have emerged. Although there has been an increase in access, in primary as well as secondary education, quality remains a very serious problem”. “The average age of our country is about 24, but almost 78 per cent of our labour force is educated below the college level. We need to improve our vocational education to harness the potential here”.

However, a high frequency of absenteeism amongst teachers, poor infrastructure and outdated curricula were major issues that had to be dealt with if the overall situation was to be improved. As for the higher education space, he was particularly critical of the present state of teacher training and curricula. According to him, “In most universities in this country, the curricula are hopelessly out of date. In some cases, the curriculum is up to 30 years old. Also, about 40-50 per cent of the teachers don’t have foggiest idea of recent developments in their subjects. Together, there can’t be a more lethal combination for students”.

The Interactive Session was addressed by Prof. Sukhadeo Thorat, Chairman, University Grants Commission.

Prof. Sukhdeo Thorat stated that the University Grants Commission (UGC) has framed a regulation making it mandatory for all universities and colleges to be certified by the National Assessment and Accreditation Council (NAAC). The move is an attempt to assess and thereafter ensure the quality of education offered in institutions of higher education in the country. Currently, the certification from the NAAC is voluntary, “while there has been progress in the absolute numbers of students with access to higher education since the time of independence, the enrolment rate of about 11 percent in India is much less than the world average of 23 percent and not much higher than the 7 percent of Africa. The problem has been addressed in the 11th Five-year Plan, with the government announcing the creation of 1440 new institutions including seven Indian Institutes of Technology (IIT) and seven Indian Institutes of Management (IIM), which he described as the “second wave of higher education in the country.” The government’s allotment of Rs.47,000 crore in the 11th plan, instead of the Rs.400 crore previously has given adequate attention to higher education which was “neglected for the last 40 years.

Professor Thorat also enumerated vast inequalities in gender, religion, caste and income groups, inconsistencies in quality and the lack of relevance to industry among the problems that hamper higher education in the country.

Professor Thorat said, “There is a considerable presence of the private sector in higher education.” In 1991, there was only one State Private University, whereas today there are 42. Of the 130 deemed universities, 90 are private universities and 95 percent of all colleges are private colleges. He said that in the coming years the numbers were only going to rise.

The session was addressed by Shri Sanjay Bhattacharya, Senior Chartered Accountant and Shri N. K. Poddar, Senior Advocate.

While commenting on the New Code, Shri Sanjay Bhattacharya remarked that the Code seeks to bring all direct taxes under one code and pave way for a single unified tax reporting system. In personal taxation, there are welcome proposals by way of revision of slabs and reduction in rate of tax. But there has been a major change proposed as regards the method of giving incentives on savings. The present method of outright deduction under Sec. 80C is sought to be replaced by “Exempt Exempt Tax” (EET) so that there is only postponement of liability because what will be given will be taken back on maturity of the same scheme. Withdrawls from saving schemes such as Employee Provident Fund (EPF), Public Provident Fund (PPF), Gratuity Provident Fund (GPF), approved superannuation benefits, and life insurance would follow Exempt, Exempt and Tax (EET) structure, i.e., it would be included in the individual’s income during the relevant year and taxed accordingly. He further stated that the base of the minimum alternate tax has been enhanced by transitioning MAT liability from book-profit based MAT taxation to value of gross-assets based MAT taxation. The rate of MAT has been proposed to be reduced from 10% of book profit to 2% (in case of banking companies, 0.25%) of the value of gross assets. However, the benefit of MAT credit has been proposed to be withdrawn. This would result in substantial increase in tax cost to companies having huge capital investment, resulting into high value of gross assets but not having adequate profits or losses in the initial years of operations.

Shri N. K. Poddar said that the MAT will now be calculated with reference to gross value of assets and not book profits. With this, even firms in SEZ will be brought under the tax net. But the proposed rate of 2 per cent is simply too high and deserves to be lowered to a more realistic level. There will be no distinction made in respect of short and long term capital gains. All gains will be taxed as per the tax rates applicable to individuals or corporate entities. The new Code does not provide for any appeal to the High Court. Section 192 provides for an appeal to the National Tax Tribunal, from an order passed in appeal by the ITAT and Section 193 provides for an appeal to the Supreme Court from any order of the National Tax Tribunal. If the NTT is not constituted before the Code comes into existence, there would be a big gap in the law.

The session was attended by from LONMIN PLATINUM, South Africa, Ms. Sanet Jacobs, Senior Manager: Supply Chain Procurement, Mr. Wouter Joubert, Manager: Mining Optimisation, Mr. Johan Mitchell, Manager: Engineering, Mr. Michele Cosani, Manager: South Africa Office, China Business Solutions, THE BEIJING AXIS and Mr. Anurag Ladha, Manager: Suppy Chain and Procurement, Bateman India.

Mr. Wouter Joubert, Manager in his presentation remarkeded that Platinum price fell sharply in 2008, due to i) Global financial crisis ii) Falling car sales iii) Selling of inventories iv) Reduction in investment holdings. In short term, there is little to change demand outlook and demand for PGM’s from auto sector to remain weak. And also mixed response from jewellery markets so far and likely slowing in the electronics and industrial sectors as demand for consumer goods softens. He added that global vehicle sales were down by almost 3 million units in 2008 and another 9 million reduction are expected in 2009.

Mr. Joubert was of opinion that still there is positive medium-long term Fundamentals -i) Robust long term automotive demand as emerging market vehicle production grows, ii) Tightening emissions legislation and auto fleet replacement requirement, iii) Low price reduces substitution threat and iv) Growing Chinese jewellery market. Chinese jewellery demand remains strong.

The management has taken actions e.g., i) Eliminate non value adding ounces, ii) Maximise output from invested capital - mechanisation approach changed, iii) Simplify organisational structure with clear accountability, iv) Reduce costs and manage cash and v)Preserve opportunities for the future. Mr. Joubert said that if market conditions are conducive, we remain confident Lonmin can achieve, and improve on, previous sales levels of over 900,000 Platinum ounces per annum.

The session was addressed by Shri Subrata Gupta, Managing Director, West Bengal Industrial Development Corporation.

Shri Subrata Gupta in his speech remarked that the West Bengal Industrial Development Corporation (WBIDC), the State’s industry promotion unit is planning to nearly double its loan disbursal for industrial projects to Rs. 200 crore in 2009-10. The Corporation had disbursed Rs.115 crore in 2008-09, out of targeted Rs.150 crore for the period. WBIDC disburses long-term and short-term loans for setting up new medium- and large-scale industries as well as for expansion and modernization of existing units. He said, “This year the loans may be disbursed mostly to food processing units, iron and steel projects and rolling mills in the state,”. WBIDC was currently generating profits from the loan schemes and capital gains from different industrial parks. Replying to a question, Shri Gupta said that most of the proposed steel projects in the State by Jindal Group, Jai Balaji, Adhunik Group, Shyam Steel were on schedule. “We don’t see any major delay in the projects other than those due to the down-turn,”. For the proposed project by Bhushan Steel in Burdwan, a few issues needed to be sorted out with the Coal India Ltd, as part of the project was located on coal bearing zones.

The session was addressed by Shri N. K. Poddar, Senior Advocate and Shri Amitav Kothari, Senior Chartered Accountant.

Shri N. K. Poddar, Senior Advocate stated that the finance minister significantly met the industry’s expectation by abolishing of surcharge, fringe benefit tax and commodity transaction tax. Extension of tax benefit under Sections 10A and 10B are also welcome. The industry’s demand for reduction in rates of corporate tax has unfortunately not been accepted this time. Shri Poddar was of opinion that the inclusion of “other amenities” to be inserted in Section 17 of the Income Tax Act was more worrying. Though the Budget does not clarify the list of other perquisites that will be taxed, the language indicates the finance minister has left the window open for taxing them. The decision to introduce a full-fledged GST from April 1, 2010 is perhaps the most notable announcement in the area of indirect taxes.

According to Shri Amitav Kothari, the budget has proved to be a letdown for the corporate sector and has not been very encouraging in view of the current economic scenario. Even the raised exemption limit of Rs.10,000 in personal income tax is hardly any relief given the high prices in the markets, though the abolition of fringe benefit tax is a good step. He added that the Finance Minister should have initiated bold measures to boost economic revival given the current circumstances and especially since the economy is on a comeback trail.

The Interactive session was addressed by Shri Debi Prasad Mishra, Hon’ble Minister of Tourism, Government of Orissa.

The Tourism Minister of Orissa Shri Debi Prasad Mishra remarked that Orissa with 480 kilometers of coastline and 58,135 sqkm of forest area has experienced a government investment of Rs 75-80 crores and private investment of about Rs 100 crores in FY 2008-09. In the last fiscal, despite global meltdown, the flow of international tourists experienced a growth of 12.7% while the domestic sector grew by 11.7% of which tourists inflow from Bengal only had a growth of 11% over the previous year.

The Tourism Minister of Orissa also informed that they are developing a Mega PPP Beach Project called the ‘Shamuka’ Beach Project over a land area of almost 3000 acres in between Puri and Chilka. Already about 1000 acres of land have been acquired and another 600 acres will be acquired in another one month. It will be a complete luxury resort with about 4 five star hotels, resorts, helipad, a small airport and spa. In the initial first phase a 27 hole golf-course has been planned  while another one is under planning which is being targeted to host golf tournaments of international standard.  International Bids will be flowed within one month or so.

The Orissa Tourism department is also wooing private investors from Bengal for developing ecological resorts, beach resorts, hotel projects and water/adventure sports. Besides, the government is in the process of leasing out 31 properties. It has asked private players from Bengal to bid for the properties.

With people from Bengal constituting over 20 per cent of the total bulk of tourists visiting Orissa, both the state governments are looking at prospects of developing a Bengal-Orissa tourism circuit. Orissa Tourism Minister Debi Prasad Mishra met his Bengal counterpart Manabendra Mukherjee on his visit to Kolkata on Friday. According to Misra, "In developing tourism in eastern region, Bengal has played an important role. Orissa has potential and given its similarity with Bengal, both should work together,". A memorandum of understanding (MoU) will be signed between the Orissa Tourism Development Corporation and West Bengal Tourism Development Corporation next month in this connection. The MoU will enable the development and exchange of tourism packages between the states - facilitating flow of foreign tourists coming from Kolkata to Orissa.

The session was addressed by Mr. Philippe Leclerc, Chairman Proximum, Mr. Pierre Jean Bonnat, Manager Proximum, Mr. Thierry Petry, Project Manager, Asia Region, Moselle Development Centre, France.

Thierry Petry, Director for India of Moselle Development Centre stated that, “The Moselle region benefits from an exceptional geographical situation. It’s at the centre of a vast market of 200 million consumers, including the most concentrated industrial activities in Europe, which generates 50 per cent of the European Union GDP,” He added, "We are looking at forming more joint ventures with Indian companies for supplying or setting up manufacturing operations either in France or India."

Moselle Development Centre of France is organising a three-day long Euro India Transportation System summit November 17-19 in Metz in France, exclusively for India. The organisers expect over 40 SMEs from the state to participate in the event, to feature six complementary fairs — automotive, aerospace, shipbuilding, railway, logistics, truck & bus — and business conventions and 40 associated conferences. Philippe Leclerc, Chairman of Proximum Business Events Engineering, a key organizer said, “The industrial profile of Metz matches that of West Bengal, with focus on areas like iron and steel, foundries and mine quarries. We are expecting around 300 Indian enterprises to engage in dialogue with 1,200-odd European companies, and Bengal will have a strong representation,”

Mr. Leclerc remarked that, "For the last four years our focus was on China and Japan where we have economic representative offices. Our focus is India this year. We want to do more business with India and so we organised this fair, a platform where European and Indian companies, SMEs especially, will be able to form joint ventures and collaborate. We expect more than 300 companies from India, and 1,200 from France and Europe,”. The organisers of EITS have worked out a subsidised “all-inclusive” package of Rs 1 lakh for Indian companies.