 |
|
 |
|
|
|
|
 | | |
|
|
| Reaction_9news |
|
|
Parasuraman R, managing director, M K Electric Ltd and chairman CII (Tamil Nadu)
01 January 1900 |
|
| |
"It is a positive budget and would score 8/10. Finance ministers' announcement to dispose off 27 central public sector units (PSU) is really good sign," opined Mr. Parasuraman. R, chairman, Confederation of Indian Industry (Tamil Nadu) and managing director, M K Electric Ltd. According to him, the budget is a practical one that addresses the needs of Indian industries. However he says that bringing the unorganised sector into tax net has not been done.
T. Ananthanarayanan, executive director, Ashok Leyland Ltd
"The widening of the service tax net is welcome sign as it will increase the revenue for the States at a later date," remarks Mr. T. Ananthanarayanan, executive director, Ashok Leyland Ltd. Taxing the service sector is a prelude for implementation of VAT, he adds.
Welcoming the 50 per cent depreciation benefit for commercial vehicles offered proposed by the finance minister he adds, "This will shore up the demand for commercial vehicles in the short run."
On the other hand the import duty concession on compressed natural gas (CNG) kits is what he expects to benefit Ashok Leyland and others in the commercial vehicles sector. Like Delhi Transport Corporation that will be buying 1,000 CNG powered buses other state transport corporation would also now go for such vehicles, he hopes.
Mr. S. Nagarajan, managing director and Mr. N. Sampath Kumar, vice president – Finance, Ashok Leyland Limited
"Apart from signaling lower interest rates I don't see anything new," remarks Mr. S. Nagarajan, managing director, Ashok Leyland Finance Ltd, Chennai.
The enhancement of depreciation rate for the commercial vehicles to 50 per cent could result in
additional off-take of Commercial Vehicles leading to higher volume of business for finance companies like Ashok Leyland Finance, he agrees.
"The interest rates on Provident Funds has been reduced from 11% to 9.5% and on the Small Savings rate has been reduced by 100-150 basis point. With Reserve Bank of India announcement already made on the reduction in the CRR and the bank rate, coupled with the above interest rate reduction, it is likely that the lending rates from the bankers and financial
institutions could come down by 75 to 100 basis point atleast from April 2001. The market can discount this and offer lower rate of interest on their lending to corporate both on short term and medium term instruments," opines Mr. N. Sampath Kumar, vice president-Finance.
The overall scenario of higher liquidity and reduction in the rate of interest will help top end non-banking finance companies (NBFC) to raise resources at competitive rates atleast by 100 basis point lower than the current level, Mr. Kumar adds. On the other hand finance companies may also have to reduce their interest rates on the Fixed Deposits they mobilise from public by 75 - 100 basis point from the current level.
With the budget giving more focus on infrastructure development, NBFCs would be able to book more business on construction equipment's, earth moving and road building machineries.
"In view of the hike in the Railway freight rates on goods the movement of goods thru road transportation would also enhance the off-take of commercial vehicle and consequently higher volume of business would be available to the NBFcs on commercial vehicles segment," says Mr. Nagarajan.
"In the current budget, there has been indications on the flexibility of improving the debt market, which I believe will enhance the higher trading of debt instruments in the secondary markets. In this circumstances, I feel that there will be lot of appetite for Medium to long term debt instruments and financial services sector especially NBFCs will be accessing these products for their funding requirements," concludes Mr. Kumar.
Allowing 100% FDI in financial services sector would result in severe competition especially in retail segment even for well-established players including banks and institutions and other NBFCs.
|
|
|
| |
|
|
|
|
|
|
