Finance Minister Arun Jaitley today said that infrastructure investment needs a booster and his next Budget in February will concentrate on empowering more open and also private spending to help financial development.
Speaking at ET Now awards, he said that India aspires to become a developed economy from a developing economy and a 7- 7.5 per cent GDP growth does not satisfy its requirements.
"Therefore spending more and now" is the focus, he said adding infrastructure spending "certainly needs a booster."
The Finance Minister said there is a long-term potential of more resources getting into the system and that is going to be the top priority.
"Therefore, the areas where we were lacking, whether in terms of encouraging investment of the private sector and so on, I think these are going to be the areas where budget should concentrate on," he said.
The government is likely to advance the date of budget presentation for 2017-18 to February 1 next year as against the usual date of February 28.
On the impact of demonetisation on the economy, Jaitley admitted that "altering this normal is extremely disruptive" but "in the long run you will have a higher GDP, a higher revenue and probably far cleaner economy and far cleaner public life."
He further said it was "a courageous decision to withdraw 86 per cent of the paper currency, replace it and then say that replacement will now be substantially and significantly in digital."
Regretting that a small section of people was trying to take advantage of the situation, Jaitley said, "This Indian normal where recovery of taxes is terrorism and non-payment is a way of life...Has to change. With this new normal that is being created, if we succeed in doing, India would be a happier place.
On the controversy relating to tax scrutiny of political parties, Jaitley said, "This is a complete media creation" and pointed out that no changes have been made in the law in that regard.
"Has a single change made in the last two months or so or in the last two-and-a-half years with regard to taxation of political parties? The answer is "No".
"Nothing has been done, whatever was the existing system which has been existed for the last 15 years is continuing and if somebody creates a political party for the purposes channelising funds ... Obviously law will step in."
Referring to the issues relating to roll out of the Goods and Services Tax (GST), Jaitley said that some political parties were trying to delay its implementation but it cannot be postponed beyond September 2017.
"I am conscious of that fact that the current political attitude of some political parties is to delay the implementation of GST but the Constitutional mandate is very clear," he said, adding the old taxation regime can continue for one year from the date of notification which was September 16, 2016.
"Nobody has the luxury of time to be in the position to pressurise if not blackmail and say it will be deferred. The Constitution today mandates that the GIST has to come in place before September 16, 2017 and states who do not do it will lose the right to collect taxes."
Observing that all issues except the one relating to division of assesses between the Centre and states have been sorted out, Jaitley hoped that states would resolve that issue also.
"It's more a turf issue...At least one state has suggested that which translated into simple language means, the 93 per cent of total assessment should be done in the states.
"India is a union of states. Federalism does not mean that union becomes so weak that its ability to hold federal India itself is weakened...I am sure this one issue, we will rise above resolve this issue," he said.
The GST Council will once again attempt to resolve the issue of cross empowerment at its next meeting on December 22-23.
(With inputs from PTI)