Union Budget will boost growth: CII

The Indian industry on Friday generally welcomed the 2003-04 Union Budget saying the proposals were "great" and "growth-oriented".

CII director general Tarun Das said, "It has outlined new strategies for growth with reduction of excise duty."

He said the provisions in the budget, presented by Finance Minister Jaswant Singh, would increase the purchasing power of the consumers bringing them back to the market, which would be very good for the Indian economy and the industry in particular.

CII President Ashok Soota termed the budget as pragmatic and said it would stimulate demand facilitating growth.

Even though the fiscal deficit continued to remain an area of concern, the finance minister has accepted Kelkar recommendations for simplification of tax procedures, he added.

Morgan Stanley managing director Ruchir Sharma described the Budget as marginally disappointing as "it has not provided for any steps to overcome the impact of the global economic slowdown."

Mahindra & Mahindra chief Anand Mahindra welcomed the Budget, saying prices of cars and other motor vehicles should come down and the consumer stands to benefit from the Budget announcements.

Sunil Munjal, CEO of the Hero Group, pointed out that the finance minister was not clear about the actual phasing out of central sales tax and the utilisation of National Calamity Fund.

Managing director of Shell India Vikram Mehta said it was a realistic and politically-acceptable Budget.

He said it would give an impetus to the power sector though the fiscal problems could not be ignored.

H F Khorakhivala of Wockhardt said the focus has been on all aspects of pharma and biotech sectors and all benefits available to the health sector like depreciation would now be applicable to these sectors also.

The measures announced in the budget would also make long term funding available for start-ups.

Bharat Puri, managing director of Cadbury India, said the measures taken should spur demand in the FMCG sector and it should benefit the overall industry.

However, Ashok Goyal, director of Essel group, said the finance minister had tried to pack a lot of goodies together.

"Domestic tourism should get a big boost with the removal of freeze on LTA (leave travel allowance) as also the incentives announced for the hotel sector," he said.

Vinnie Mehta, executive director of Manufacturers Association of Information Technology, said the branded computers should become cheaper by Rs 400 to Rs 500 while exports should become more competitive.

Sanjeev Goenka, vice-chairman of RPG Group, said the Budget was "structurally brilliant" and one of the best in last many years.

"It is people-oriented, growth-oriented and industry friendly", he said, adding "I am absolutely stunned. What more could be asked."

Commenting on the Budget, Ashish Guha, CEO, Lazard India said it is a good strong Budget in the long-term interest of the nation.

The finance minister has maintained continuation of policies of this government and outlined five priority areas, which would be addressed by measures taken in the Budget.   As regards to banking sector, he said the sector was already witnessing number of mergers and acquisitions and hiking of FDI limit to 74 per cent would encourage this activity further.

B Muthuraman, managing director of Tata Steel, said the finance minister had delivered a good budget despite this year being an election year.

S P Oswal of Vardhaman Group said the measures taken for the textile sector will make it more competitive and hi-tech.

He said it would also lead to growth of investment into the sector to the tune of Rs 100,000 crore (Rs 1,000 billion) by 2010.

Oswal said the measures have also created a level-playing field within the different areas of the textile sector.

Industry captain Subodh Bhargava said the lowering of excise duty, coupled with cut in customs duty would eventually boost demand and stimulate overall growth.

He said the finance minister had tried to give "concrete shape" to public and private partnership.

"Jaswant Singh has tried to bring some newness with the introduction of single sheet tax forms," he said.

Maruti Udyog Ltd managing director Jagdish Khattar said the move for private sector participation for airport and sea port development "augurs well" for the industry while the thrust on sectors like tourism and textiles was long overdue.

Rahul Bajaj of Bajaj Auto hailed the Budget as "great" saying the finance minister has given concessions to the industry.

Although the Budget deficit of 5.6 per cent was "worrying" but the excise duty cut would eventually spur demand, Bajaj added.

Terming the Budget for 2003-04 as "very good", the Indian Merchants' Chamber said the

rationalisation of the tax structure and boost to infrastructure would help spur growth in the entire industry.

"The Kelkar Committee recommendations have been taken into consideration and will be implemented to quite an extent, but in a phased manner. This will help the entire industry to post growth in this fiscal itself," IMC president-elect Shailesh Haribhakti said.

He said the proposed rationalisation of tax structure will help in projecting India as an "industrial destination" from this year itself.

On the government's decision to retain the Value Added Tax regime, he said such a move will "set a trend of industrial revolution which would be helpful to the country, especially at a time when World Trade Organisation reforms are in place."

IMC outgoing president Suresh Kotak said this was the "best budget" that has happeneed in recent times, especially for the agricultural sector.

"Agriculture was not given an impetus in the previous budgets, and this year the importance of agriculture has been recognised by the government," Kotak said.

"Tax structure has been simplified and cleansed and introduction, and one-page application form for filing income tax returns will go a long way in helping the common man," he added.

Hailing the Budget 2003-04 as "historic", Federation of Indian Chambers of Commerce and Industry said it would boost textiles, infrastructure and pharma sectors and generate employment.

Rajan Mittal of Bharti said that telecom being a part of the infrastructure sector would benefit from the Budget and the government's decision of hiking the FDI in the sector would help in bringing investment in the telecom sector.

Describing the Budget as excellent, FICCI secretary general Amit Mitra said the excise duty rationalisation has been done in such a way that it would boost employment in certain sectors. It would spurt research and development activities in the country.

Bengal Chamber of Commerce and Industry chairman Sumit Majumdar said, "By and large, it has been a very encouraging and a positive budget, which covered all aspects."

Eicher chairman S Sandilya said the Budget was growth-oriented and had various innovative points like its focus on infrastructure sector, specially roads which, he said, would give a boost to vehicle demand in the country.

He however, lamented that sops have not been extended to tractors, which was currently going through a downturn.

Welcoming the Budget, Max India chairman Analjit Singh said the sops provided to health sector would help to further grow the sector.

He also welcomed the reduction in customs duty on various health related items and also consumer durable items.

IFCI chairman V P Singh said the 2003-04 Budget would boost investor confidence and promote savings, which was the need of the hour.

"It will help to promote investment, both domestic and foreign investment. It is important because domestic savings had declined," Singh said.

He however said that more steps were needed to attract high capital investment.

Stating that it was a historic and balanced Budget, O S Kanwar, chairman and managing director, Apollo Tyres said the duty cuts would be passed on to the customers.

Sushil Ansal of Ansal Housing said the Budget had given a big boost to the housing sector.

PTI