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Budget should give PE asset managers access to rupee capital: Gopal Srinivasan

TVS Capital Funds Chairman Gopal Srinivasan says access to rupee capital will help new and growth businesses get abundant access to risk capital and growth capability.

twitter-logo Sarika Malhotra        Last Updated: February 14, 2013  | 09:22 IST

Business Today's Sarika Malhotra spoke to TVS Capital Funds Ltd Chairman Gopal Srinivasan on his expectations from Budget 2013 -

Q. Given the current challenges, what, in your opinion, would make for a good budget? What measures or proposals would you like to see?
A. A clear roadmap for implementation of the goods and services tax (GST) by financial year 2015 and aiming for 1.5 per cent GDP increase should be a priority. Also, the compensation formula with states should be finalised soon and an outline of the GST should be presented in the financial year 2014 budget with a clear target of full rollout in 2015.

FULL COVERAGE:Union Budget 2013-14

The government should introduce measures to facilitate the growth of micro , small and medium enterprises as they are the next wave of growth engines. Steps should be taken to incentivise capital formation to support and encourage growth of larger enterprises as well. Also, simplifying starting-up and exit processes would go a long way in creating a good entrepreneurial eco-system.

Q. If the budget does not meet expectations, do you fear that business sentiment would once again dip?
A. Yes, it would impact business sentiment.

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Q. Specific to your sector, what could the current budget do to improve conditions?
A. Provide access to rupee capital to Indian private equity asset managers so that new and growth businesses get abundant access to risk capital and growth capability.

Facilitate flow of institutional rupee capital to Indian alternative investment funds (AIFs) by modifying IRDA (Insurance Regulatory and Development Authority) and PFRDA (Pension Fund Regulatory and Development Authority) rules. Permit charities and endowments to invest in AIFs by adding them to the list of permissible investors.

Rationalise the tax treatment of different investment structures to encourage investment in domestic AIFs and place them on an even footing with foreign AIFs.

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