PricewaterhouseCoopers’s (PwC) new chairman Sanjeev Krishan has said that mid-corporates and NBFCs are facing stress along with hospitality, aviation and other general consumer businesses, which are awaiting demand pick up.
“For various reasons, the big have continued to become bigger, not just because of M & As but due to a series of events — demonetisation, GST and others. Even the Insolvency & Bankruptcy Code has enabled further consolidation and the pandemic has in some ways exacerbated the Consolidation process. One of the key challenges has been the narrowing of the mid – corporates space; simply put an original equipment manufacturer can possibly survive the crisis, but long-term sustenance would require the entire supply chain and the distribution network to remain strong. They are also very significant job creators, and critical from a societal perspective.
While several business leaders have proposed providing support to businesses to come out of the crisis, the government has refrained from offering tax concessions, although the Reserve Bank of India (RBI) has opened a window to restructure loans.
Krishan also suggested that FM Nirmala Sitharaman should focus on healthcare, sanitation, recapitalization of some institutions and investment and innovation apart from boosting infrastructure investments to pump prime the economy out of the slowdown.
“Disinvestment will be a big theme and some of the lacunae, particularly on the indirect tax side, once plugged can create avenues for higher revenues. The final thing is how we enhance the tax base. Despite what has been done, tax collection is still from a narrow set of taxpayers. We need to create an environment for more people to come into the tax net and plugging of leaks using data analytics”.
