The Hindu : Business : Finance Minister to start pre-budget consultations from January 7

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Finance Minister to start pre-budget consultations from January 7

Special Correspondent

Top priority to consultations with the farm sector

NEW DELHI: The Union Financed Minister P. Chidambaram will begin the pre-budget consultations with representatives of various sectors from January 7. The consultation process starts with a meeting on the first day with those representing the agriculture sector.

Official sources say that Mr. Chidambaram has invited suggestions on inclusive growth, investment in the infrastructure sector apart from restructuring the food and fertilizer subsidy without hurting the poor people. He has also invited the captains of industry, economists and trade union leaders next week, before giving final touches to the budget.

A lot of importance is being attached to his decision to start consultations with the farm sector representatives. The government is actively considering a financial package, estimated at Rs. 30,000 crore, for the debt-ridden agriculture. The report of the Vaidyanathan Committee, which deals with the subject, is already before the government.

Indications are that India Inc. will, in the course of consultations, raise the issue of adverse impact of rupee appreciation against the dollar, besides seeking cuts in excise duties and corporate tax. It is also likely to urge the government to delay the proposed cut in customs duties on manufacturing items.

The Confederation of Indian Industry (CII) and other industry bodies have sought abolition of surcharge on corporate tax, dividend distribution tax and minimum alternative tax (MAT).

When it comes to trade union leaders and economists, they may raise the issue of enhancing income tax exemptions, hike in interest rate on provident fund and effective measures to check rising prices of essential commodities. They have been raising these demands in the past.

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