A lacklustre budget, feels India Inc

New Delhi: Indian industry may have found the Union Budget to be a lacklustre affair, if reactions across the board from representative industry associations are anything to go by. By and large, India Inc has raised concerns about the lack of measures in the budget that could have increased productivity. They have bemoaned the fact that the annual budget has lost an opportunity to provide relief to the corporate sector.

R Sesashayee, president, CII, said that the budget failed to follow up on the recommendations of the Kelkar Committee to reduce excise duties. He pointed out that with revenues from peak customs and excise increasing, this could have been an ideal time to reduce excise duty to 20 per cent, if not 15 per cent overall, which would have been in line with Kelkar Committee Report.

"This budget is disappointing as there has been no steps announced to increase productivity in agriculture, electricity and other sectors which are not producing up to their potential," he added.

Habil Khorakiwala, president, FICCI, says, "With an increase in cess, as well as in dividend distribution tax, the budget has sent a wrong signal to the corporate world. One does not understand how the multiple taxes should be charged. I think the feeling of the chamber is that the finance minister has lost an opportunity of providing relief to the corporate world."

Ruchir Sharma, head of emerging markets, Morgan Stanley, echoed similar sentiments of disappointment. He feels that in "absolute terms" the budget may turn out to be "insipid" as compared to previous ones.

Jagdish Khattar, managing director, Maruti Udyog though welcoming the emphasis placed on agriculture and education, expressed his disappointment about the fact that there were no initiatives with respect to the automobile sector. He said, "There is nothing for the auto sector in the Budget. It is a disappointment."

D D Rathi, Grasim, CFO, has also expressed his disappointment, saying that the imposition of the variable excise duties on cement, based on maximum retail prices, would not help the industry. "The tax structure is a hybrid type and cement contributes very low in inflation. So I see no reason why such steps should be taken," Rathi said.

Naresh Trehan, chairman, National Health Care Committee, CII, while welcoming the 21 per cent increase in outlay for health segment, implied that the measures fell short as health care should have been given the status of infrastructure. "The steps are in the right direction, it is very positive. But it remains to be seen how the implementation of National Rural Health Mission takes place," he added.