M.S. Unnikrishnan, Managing Director, Thermax speaks to Business Today's G. Seetharaman on Budget expectations:
Q. Given the current challenges, what, in your opinion, would make for a good budget? What measures or proposals would you like to see?
A. It will be a balanced budget and not a populist one. The finance minister is fully aware of the constraints he has. On the one hand, he has to control the fiscal deficit, and on the other hand, formulate policies that will kick-start the investment cycle.
Q. government faces in raising revenue, do you see a case to increase income tax rates on the rich?
A. Personally, I think we need to tax not just the super-rich, but even the rich more.
Q. Please identify the cut-off in income beyond which you would classify the person as rich.
A. I would say anyone making more than Rs 50 lakh a year is rich. I'm not saying it should be a flat rate above that level. It should be calibrated.
Q. Do you expect a business-friendly budget?
A. There will have to be policy stability and schemes that support investment. Industry is not expecting freebies.
Q. Specific to your sector, what could the current budget do to improve conditions?
A. As far as the power sector is concerned, I expect announcements to revive the sector. A lot of things like fuel supply agreements (FSA) are not within the finance minister's control but he can increase allocations in bank lending to the power sector. He can also increase ECB (external commercial borrowing) limits.
Q.Any other area the finance minister needs to tackle?
A. Food inflation needs to be controlled. There should be schemes to improve agricultural yields and set up more cold chains.
Q. Which recent budget do you remember as having been a good one?
A. The 2006 budget presented by P. Chidambaram. There were measures then to control the fiscal deficit.