Spelling out the pending agenda for the government, CII president Rajesh V Shah said that the restriction of Modvat credit on inputs to 95 per cent has had a "deleterious effect" on the entire industrial community.

Instead, if the government switches over to levy of five per cent surcharge, it would not only give revenue to the government but also redress the difficulty of the industry to a large extent. He said the Modvat restriction in its present form has affected ancillarisation, vendor development, sub contracting, small scale industry and job workers etc.

CII has reiterated its demand of imposing4% special import duty on imports for fertiliser, coal mining, power generation and crude petroleum refinery projects.

The CII president, while complimenting thegovernment for taking 42 major initiatives in various spheres, pointed out 46 pending issues were not resolved.

Shah said that the government also needs to urgently revive the capital market by removing restrictions on inter corporate loans and investments, allow buy back of shares and remove restrictions on bank loans against shares and debentures. He also called for extension of benefits under Section 88 of the Income Tax Act to all mutual fund schemes and revival of the erstwhile Section 80-CC.

CII has urged the government to disinvest upto 49 % in the core sector.