The Hindu : Karnataka / Bangalore News : ‘A populist poll-eve exercise’

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Saturday, Mar 01, 2008
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Karnataka

Karnataka - Bangalore

‘A populist poll-eve exercise’

Special Correspondent

Mixed reaction from industry representatives in State

— Photo. Bhagya Prakash K.

What’s in store?: FKCCI president S.S. Patil and vice-president J. Crasta watching the Budget presentation by P. Chidambaram, in Bangalore on Friday.

Bangalore: There was mixed reaction to the Union Budget for 2008-09 from a cross section of industry representatives. Many viewed the Budget as a “populist” election-eve exercise, particularly the scheme to waive loans of small and marginal farmers, while some saw positive features in the Budget.

Vice-chairman of the Karnataka chapter of the Confederation of the Indian Industry S. Viswanathan said the loan waiver scheme would cost the Government $1.5 billion, which amounted to more than 10 per cent of Foreign Direct investment. “In contrast,” he said “industry has received very few concessions.”

BEML chairman and managing director V.R.S. Natarajan said the tax concessions were favourable to the manufacturing sector. He termed the Budget “industry-oriented” and welcomed the increased allocations for education. Irfan Razak, managing director, Prestige Estates Projects Pvt. Ltd., said the Budget “had nothing for real estate sector.”

Vishal Bali, CEO of Wockhardt, welcomed the tax concessions for health insurance. He also said the reduction in import duties on some life-saving drugs would benefit patients.

Gautam Maini, Managing Director, Maini Precision products, said there was “not much relief for small and medium enterprises.” He complained the problems posed by cost escalation of inputs and the appreciation of the rupee have not be addressed by the Finance Minister.

Federation of Karnataka Chambers of Commerce (FKCCI) Chairperson S.S. Patil said that the Budget does not adequately address the needs of industry. The industry, he added, was expecting a reduction in corporate tax, abolition of fringe benefit tax and removal of surcharge. The Karnataka Small Scale Industries Association was critical that the Budget failed to increase the threshold for exemption from central excise.

‘Balanced’

Describing the Union Budget as “quite balanced,” the Bangalore Chamber of Industry and Commerce has said that Union Finance Minister P. Chidambaram has done a commendable job when viewed against the challenges in terms of keeping up growth and containing inflation within a framework of inclusiveness.

Welcomed

Welcoming the measures to address a number of social issues, BCIC president John M. Panikar said the creation of a non-profit corporation with a corpus of Rs. 15,000 crore for helping the skills development programmes in order to make the demographic dividend meaningful was a good step as it was combined with upgradation of industrial training institutes.

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