Dear
Shri Das
,
Today's
Hindustan Times ( 19 Oct ) quotes you as follows :
" Government is working
on providing a more enabling eco system for Start Ups.
Start
Ups have potential for job creation "
It
goes on to add ,
"
He also invited suggestions from the public to
improve eco system for start ups "
In
this regard , I request you to read my following blog / attachments
After
decades of Policy Paralysis , " Increementalist
Attitude " will take us no where
To
escape the " Time Warp " , we need a " Worm Hole "
with
regards ,
hemen
parekh
Mumbai
www.hemenparekh.in > Blogs
(M)
0-98,67,55,08,08
-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
FROM JOB-SEEKERS TO JOB CREATORS
(
blog dt 15 Sept 2015 )
-----------------------
How to turn 12 million persons entering our work-force each year
from being job-seekers to becoming job-creators ?
At the conceptual level , this was well-answered in BJP poll
manifesto as :
" Encourage and empower our youth for Self Employment -
incubating entrepreneurship as well as facilitating credit "
How to
translate this policy into specific actions ?
May be the
clue lies in the following incidence :
After getting
a post-graduate degree in engineering from USA , when I returned to India in
1959 , my father took me to meet Shri Manubhai Shah , the then Minister
for Industry in Union Government
My father
inquired if Manubhai could give me a job in government
Manubhai
answered :
"
Chunibhai , I have no job for your son .
Let
him set up a factory and manufacture fractional horse power motors of which
India is currently importing some 3000 per year
We
will ,
> Immediately
issue to him , an Industrial License
>
Allot him a factory-shed in Rajkot Industrial Estate
>
Give him a loan of Rs 5 lakhs to buy machinery "
56 years
later , we are better organized / equipped to " Institutionalize "
this pioneering thinking
Here is my
suggestion :
* Role of
MakeinIndia web site
> On its web site , list 5000 products that we currently import ( with
annual import bill / sources / ave landed cost etc )
> Invite 1000 leading manufacturing companies of India , to make
online selection of minimum of 5 items each, for preparing DPR
( Detailed Project Reports ) .
Freely visible online database of who selected
which items will avoid
duplication
* Role
of Manufacturing Companies
> Prepare and submit to Ministry of Commerce, at least 5 DPR by
Dec 2016 .
More the merrier ! Earlier the better !
> Each report must carry , name of at least one bank which has
accepted that as a " Bankable Report " , eligible for
funding
> Train at least 100 fresh engineering graduates in various
manufacturing related functions under GET ( Graduate Engineer
Training ) Scheme , each year
*
Role of Ministry of Commerce
> Publish DPRs on its web site for free downloading
* Role of
Income Tax Department
> Give 200 % tax deduction to
existing manufacturing units for 2
years , for employing fresh engineering graduates on their rolls ,
under :
" Graduate Engineers Training Subsidy Act - 2015 "
( to be enacted )
This will motivate manufacturing units to impart manufacturing
related experience to fresh engineering graduates before they
venture to set up own MSME factories
> Admit expenses incurred by manufacturing units for preparation of
DPR ,under their CSR obligation
( 2 % of ave net profit for 5 years )
> Exempt all GET Start Ups ( registered
on eBiz web
site ) from
paying Corporate Income Tax for first 10 years of working
> Exempt all GET Start Ups from GST payment ,
for 10 years
* Role of
Fresh Engineering Graduates
> Get GET Training Certificate from employer companies
> Download DPR from Commerce Ministry web site
> Apply for funding to banks , attaching DPR and GET Certificate
> Upon receiving Approval Intimation from bank , apply for various
permissions on eBiz web site , quoting Bank
Approval Number
* Role of
ASSOCHAM / FICCI / CII etc
> Encourage their manufacturing member firms to take
on the
task of preparation of DPRs and follow up
>
Publish DPR reports on their web sites for free downloading
>
Constitute State-wise " Hand-holding Teams " of retired
executives having " Manufacturing " experience , to guide the
local GET applicants in obtaining all permissions from various
State Authorities
* Role of
eBiz web site
>
To make available in public domain , all investment related
applications , and progress status of each
* Role of
State Governments
>
To keep track of those eBiz investment applications where
the State is the proposed manufacturing location
> Pro-actively reach out to such applicants for expediting their
proposals
All of the
above need not / must not take months to materialize !
If it takes
any longer , millions of India's jobless will overthrow the governments in
power !
We don't
need an Oracle to tell us what future holds for us !
-------------------------------------------------------------------------
hemen parekh
16 Sept 2015
-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Saturday, 12 September 2015
--------------------------------------------------------------------------------
You may also call it ,
" Start Up Act - 2015 "
# Objectives of the Act
Every
year , to create 5 million Start Ups , each employing 2 persons , for a
total of 10 million new jobs per year
# Methodology
*
Instead of Companies Act - 1956 , these Start Ups will be governed by the Start
Up Act - 2015
* A Start Up can be launched by any Indian citizen under the age of 30 ( covering
roughly 65 % of our population )
* A Start Up will need to register online on the web site of the Income
Tax Department and obtain a unique "Start Up Number "
* Although all Start Ups will need to file annual Income Tax returns (
with full disclosure of income / expenses / profits / sources of funds etc ) ,
it will not be required to pay any Corporate Income Tax for
the first 10 years of its existence
* A Start Up will be free to raise funds from any
source ( Individuals / Companies / PE funds / VCs / Angel
Investors / Religious Trusts etc )
* 100 % FDI will be permitted in Start Ups
* A Start Up can receive loans or equity and be able to accept fixed
deposits . It can also give loans to individuals or other Start Ups or invest
in other Start Ups by way of equity
*
There will be no restrictions on what interest (
on loans / FDs ) that a Start Up may pay nor any restrictions on dividends it
may declare
The dividends declared by Start Ups will not attract any Income Tax
* As
far as the persons / companies etc providing funds to Start Ups ( by way of
loans or equity ) is concerned , no questions will
be asked re their source of funds
# What will happen ?
*
Billions of rupees worth Black Money will flow into these Start Ups - money
which is currently lying unutilized or locked up in unproductive assets
* If
Jan Dhan Yojana could create 200 million bank accounts in 20 months , Start
Up Act - 2015 , will create 200 million Start Ups in next 10 months !
All that led to this World record was , someone suggesting the unthinkable :
" Let us enable poor people
to open bank accounts with ZERO bank balance "
" Start Up
Act- 2015 ", will unleash a similar " Start Up Tsunami
" !
*
Within 3 months , thousands of Venture Capital Funds will be born , exclusively
for funding of Start Ups ( You know who will set up these VCs ! )
*
With NO Income Tax to be paid , Start Ups will conduct all transactions through
cheques ( receipts / payments )
*
GST collections will go up
* Domestic Savings Rate will go up
*
Since millions of ( Black Money holding ) individuals / businesses will come
forward to fund these Start Ups , lending pressure on banks will go down
*
Who knows , Start Ups may get into the business of Assets Reconstruction and
relieve banks of NPAs !
*
With locally / domestically stashed Black Money flowing into the economy , our
dependence on FDI will go down
*
Corruption will decline drastically
# Why the need for Start Up
Act ?
It is simple
In the past 300 years , we have
had different systems of Economic Development , viz:
Communist /
Socialist / Capitalist
There were periods when each
worked well - depending upon the geography and the technological environment
prevailing during those periods
Today, Internet and mobile
apps are pushing the World towards an E - Commerce economy , which covers
entire World seamlessly
Tomorrow , Internet of Things
( IoT ) , will tell us what we need to do and when ! Our lives will be dictated
by devices !
That will demand a brand NEW
SYSTEM of economic development which transcends national boundaries
Old rules / regulations /
laws will not help us find jobs for12 million youths
entering India's work force each year
An ocean-going " Ship
" , cannot traverse galactic distances of Space
Following in the footsteps of
Albert Einstein / Stephen Hawking , we need to
" Bend the Space
"
And travel through the
Worm-holes !
Using the hologram of the
" Start Up Act - 2015 " , we must project our economy into :
" Distributist
Economy ",
which goes beyond the "
Communist / Socialist / Capitalist " economies !
That is the ONLY WAY to
create a ,
" New
Economic Order / The Start Up Economic Order "
Last - but not the least :
No politician will oppose the
unanimous passing of the "Start Up Act - 2015 "
, in Lok Sabha or Rajya Sabha
You know why !
-------------------------------------------------------------------------------------
hemen parekh
13 Sept 2015
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