Tuesday, Mar 01, 2005
Tuesday, Mar 01, 2005 |
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Advts: Classifieds | Employment | Karnataka
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Bangalore
By Our Staff Reporter
BANGALORE, FEB. 28. The Chairman of the Confederation of Indian Industry - Karnataka, K.K. Swamy, has said the Union Budget is growth oriented and covers all sectors. The Common Minimum Programme of the United Progressive Alliance Government at the Centre projected a growth rate of 7 per cent to 8 per cent, and the budget estimates an overall growth rate of 6.9 per cent. The industry/secondary sector is estimated to grow at 8.9 percent over the previous year. The Government hopes to limit inflation to 5 per cent. According to the Bangalore Chamber of Industry and Commerce (BCIC), a major feature of the budget is the creation of a special purpose vehicle for funding infrastructure projects, which will provide seed capital for starting projects. However, the measure to curb tax evasion — the tax on withdrawal of Rs. 10,000 on a single day from a bank — has not seen much research, and it will strain the banking system, a statement from the BCIC said. It said minimum alternate tax remains, and this is disappointing, especially for infrastructure companies. There is no clear road map for major tax reforms. Mr. Chidambaram has entrusted various committees to make suggestions, it said.
Employment
According to Manandi N. Suresh, president of the Federation of Karnataka Chamber of Commerce and Industry, the Budget has largely come up to expectations. It recognises the best way to fight poverty, and the focus on primary education and public health complements employment generation, he said. Given the large stock of foodgrains and the huge foreign exchange reserves, Mr. Chidambaram could have made bolder provisions for the social sector and employment generation. The proposals on indirect taxes are "revenue neutral" and will help industries become competitive.
Central excise
As for Central excise, the increase in SSI (small-scale industries) exemption limit from Rs. 3 crores to Rs. 4 crores, and the introduction of a service tax exemption limit of Rs. 4 lakh will help small assessees, Mr. Suresh said. He said the huge uncovered fiscal deficit is a cause for worry. Social sector outlays will be meaningful only if funding is specific and well managed, he added. Mahadev Dhadd, president of the Karnataka Small-Scale Industries Association (KASSIA), welcomed the increase in capital subsidy to Rs. 173 crores and the proposal on SME (small and medium enterprises) competitive programmes. The assistance provided for the Bangalore Metro rail project will help strengthen the infrastructure, he said. KASSIA has asked the Finance Minister look into the removal of the concessional rate of Central excise duty up to Rs. 1 crore.
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