Riyadh: Promising easier business environment for global investors, Prime Minister Narendra Modi on Sunday said retrospective taxation has been relegated to history, but he is "not able to do anything" on two pending cases from the previous government as "they are sub-judice".
Inviting Saudi businesses to come and invest in India in sectors like railways, defence and energy, Modi also said a common indirect taxation regime in form of GST (Goods and Services Tax) was "about to happen". He, however, refrained from giving any specific timeframe.
Addressing Saudi CEOs and Indian business leaders here, Modi said his government has opened up various sectors to foreign investment and India stands out as a "beacon of hope" amidst global economic slowdown.
"World Bank has upgraded India by 12 ranks in Ease of Doing Business. I expect in the next review, our ranking will improve further because we have made a lot of administrative reforms.
"You are worried about GST. Do not worry about GST. GST will happen. I cannot give a timeframe, but it will happen. It was our commitment, and it is about to happen," Modi said.
Prime Minister added the government is in favour of long-term stable and predictable policies and any retrospective amendment to tax laws is a thing of past.
"There are two cases of the previous government, but they are sub-judice matter, so I am not able to do anything... Now, retrospective tax in India has become a thing of past. It will not happen going ahead," Modi said.
Although Prime Minister did not specifically name the pending cases, the major retrospective tax disputes include those involving Vodafone and Cairn. Modi said with huge growth potential and evolving global relations, India should have a predictable taxation system.
"Retrospective tax is also a thing of the past. We have said this again and again in Parliament. Today again I am saying.
"If someone plans to come to India after 10 years, he should be able to predict the tax structure. So I'm in favour of a long-term predictable tax system and we have implemented it. So I don't think that in coming days there will be any problem," he said.
Prime Minister also said Saudi investors can look at petroleum, renewable energy, infrastructure and defence manufacturing as possible areas for investment.
"Saudi investment in fertilisers, warehousing, cold chain facilities and agriculture would be a win-win partnership as it would ensure good quality food products for Saudi Arabia," he said, adding defence sector accounts for second largest contributor to the import bill, after oil.
"We import everything for Defence sector. Why can we not manufacture defence equipment in India? You investors can play a big role in that. Whatever will be manufactured, India is a very big buyer," Modi said.
Prime minister added that today's world is scared of two things. First is terrorism and the other is more dangerous, cyber terror, which is unknown, but can still happen.
"There is a need for innovation in the field of cyber security and India has the talent. There is a need for dynamic professional management and for that there is lot of investment that is required," Modi said.
Inviting investments in petroleum sector, Modi said investors can partner India in energy sector as the country offers "transparent" policies.
He said in one year, India has already achieved 5,500 MW of renewable energy production.
"When I first time said 175 GW renewable energy people were surprised.... And I am confident that we will do it within the time period. I want investment in solar equipment manufacturing and we are ready to produce 175 GW renewable energy, which will be a strange thing for the world," Modi said.
Later in the day, Ministry of External Affairs spokesperson Vikas Swarup tweeted that Prime Minister met Chairman of Saudi Aramco, Khalid A al-Falih and discussed issues related to energy and healthcare sectors.
Al-Falih, who is also the Minister of Health said Aramco looks to India as its number one target for investment, read Swarup's tweet.
Saudi Minister of Foreign Affairs Adel al-Jubeir also met Narendra Modi before the ceremonial welcome.
While interacting with 30 Saudi CEOs and Indian business leaders here, Prime Minister said the Centre along with state governments have worked to take over the distressed power sector loans from banks. "Now we are working with private companies. On that also we have progressed fast. So NPAs will not be an issue in the near-future."
Modi said a lot of foreign banks are functioning in India and going forward, whatever is needed, the government will do.
He described India and Saudi Arabia as old friends, ready to take bold new steps to a golden future.
Modi said India had a unique combination of democracy, demography and demand, and several policy initiatives have been taken over the last two years to spur growth.
He said there was tremendous scope for investment in the manufacturing of medical devices.
India's health sector is globally extremely cost competitive, offers immense scope for health tourism.
He also called for taking the economic relationship between the two countries beyond export and import, to technology transfers and joint investment.
Emphasising the strength of ties, Modi recalled King Salman mentioning that he was taught by an Indian teacher.