The overall thrust of Union Budget has been on promoting growth- FICCI
Reacting on the Union Budget 2009-10, Mr. Harsh Pati Singhania, President, FICCI said “The Finance Minister has done a tightrope walk over a huge distance in a difficult situation – of a large fiscal deficit and a steep fall in growth rate. And he has done a good walk. It is an ambitious budget and a job well done in the most trying circumstances.”
“The Finance Minister has placed his faith on growth. He has provided a stable tax framework with some reforms and simplification of procedures. He has not attempted an outright correction on the fiscal front which could have set back growth at this stage”, he added. “The Finance Minister’s growth strategy relies on three triggers – higher investments especially in the infrastructure sector to the tune of Rs. 1, 00, 000 crores , leaving more money in the hands of consumers by abolishing surcharge in the personal income tax and increasing agriculture production to hold the price line. Such a comprehensive approach will help India return to the 9% growth trajectory over next two years time”, said Mr. Singhania.
The overall thrust of Union Budget 2009-10 has been on promoting growth and FICCI appreciates the government’s decision to continue with the stimulus measures. Some of the positives that we can pick up from the budget presentation include abolition of the Fringe Benefits Tax and the Commodity Transactions Tax, continued commitment to changeover to a Goods and Services Tax from April 1, 2010, larger investment in the agriculture sector particularly on developing the cold chain infrastructure, greater investments in the infrastructure sector & social sectors and an even higher target for agriculture credit in the year 2009-10.
The exporting community too has got further support in the form of extension of the interest subvention scheme, higher allocation for the market development assistance scheme and simplification of the service tax refunds mechanism. An area where FICCI would have liked the government to have come out with some concrete proposals is disinvestment. Although the Finance Minster alluded to the disinvestment process, no clear roadmap was laid out in this regard. Another area of concern is the impact of the large government borrowing may have on interest rate. Finally, sectors like tourism, textiles and health that generate huge employment did not see many of their demands getting addressed in the budget.
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