US firms welcomes economic reforms by India: FM Sitharaman

Finance Minister Nirmala Sitharaman has said that the Biden administration as well as leaders from the corporate sector in the US have welcomed as a very positive step the reforms undertaken by the Indian government, particularly the withdrawal of the retrospective tax.

In August, Parliament passed a bill to scrap a tax rule that gave the tax department power to go 50 years back and slap capital gains levies wherever ownership had changed hands overseas but business assets were in India. The bill provides for the government to refund the retro tax to companies provided all legal challenges are withdrawn.

"The reforms that we've undertaken, particularly the steps taken for the withdrawal of the retrospective tax has been mentioned by the United States administration as a very positive step," Sitharaman said.

"The businesses with whom we have been interacting have also welcomed that decision," she told reporters here at the conclusion of the Washington DC-leg of her US trip on Friday.

From Washington, Sitharaman will go to New York for an interactive session with the business community before flying back home.

Responding to a question on a trade deal with the US, Sitharaman said her focus was on investment incentivising agreement for which there is time till December.

"We have spoken about it. The two countries would like to carry on the negotiation and conclude at the earliest," she said.

"But on the larger issue of the trade itself is something which commerce (ministry) is working together with the (American) counterpart. So, I have not engaged in depth into that," Sitharaman said.

No stranger to India-US relationship, as she played a key role in this and during her previous stints as the commerce and defence minister, it is Sitharaman's first trip to the US after the COVID-19 pandemic hit both the countries.