Budget neutral for corporate sector, says Bajaj Group Chairman Rahul Bajaj
Rahul Bajaj March 1, 2011Overall I will say it was a good budget. The many welcome measures for the social and infrastructure sector was a good development. The investment on education sector was a welcome move as well. As I have reiterated in last few days, agriculture is the most important sector in our country. The government should invest in agriculture infrastructure and supply chain so that the farmer gets a higher price and the consumer has to pay a lower price.
I still do not know how the government is going to achieve this.
From the point of view of the corporate sector I will say that I do not feel very enthusiastic. It was not a very exciting budget for the corporate sector. There was nothing negative in particular, but then there was also nothing positive either.
It will be better to say that the budget was neutral for India Inc. The increase in MAT is not a welcome move, also the fiscal deficit target is still higher than what was expected. I was expecting it to be 4.5 per cent for the next fiscal. The economy required a clear plan to tackle inflation and the fiscal deficit. The good side is that certain parts of the stimulus package were not rolled back.
As far as the automobile sector is concerned it was a good budget. I congratulate Finance Minister Pranab Mukherjee for not raising excise duties on vehicles, which was a surprise move, as we all were expecting a hike in the excise duty. Also, we are very happy that the government has realised the importance of electric and hybrid vehicles.
The automobile industry will undoubtedly continue to grow.
The government has increased the cost of travel and the cost of medical treatment in the country which I feel is rather unfor by tunate. The decision to include a private hospital with more than 25 beds and an air conditioner under the purview of taxation came to me as a surprise.
This is not a welcome move at a time when we are asking for public- private partnership in the healthcare sector. There certainly was scope for the Finance minister to do more on this front.
I do not feel that the finance minister was operating under any constraints, except that there are elections coming up in a number of states. It is about time we move out of the idea of an ' electoral budget'. What the finance minister should have aimed at was to present a good budget, aiming at inclusive growth of the economy, irrespective of whether or not there are elections round the corner.
The situation is likely to be even more difficult next year as there are elections in Uttar Pradesh - which is the mother of all elections - and the Maharashtra and general elections are in 2014.
Also there are two issues that the Finance Minister did not address - tackling corruption and bringing black money back to the country. Even though both are connected, I feel that these are two separate issues.
TO MY mind it is not possible for the government to take steps to completely eliminate corruption.
Considering that much more could be done, they have not been able to do so. It is only in the last two or three months that these issues have gained serious proportions in the public eye and it has become a matter of media debate that action be initiated on these fronts. I cannot comment on whether the government is serious on these issues or not, but I feel that the action must be self- initiated and not begin merely due to pressure from the court and the media.
Rahul Bajaj is chairman of the Bajaj Group of Industries and a Rajya Sabha MP
Courtesy: Mail Today