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Budget 2013: 'Provide easy access to working capital funds at low interest rates'

K.K. Kapila, Chairman of International Road Federation, says the budget should increase allocation for infrastructure development, duly considering the capacity of financial institutions to provide funds to private sector entities.

Anilesh S. Mahajan        Last Updated: February 21, 2013  | 20:12 IST

K.K. Kapila, Chairman of International Road Federation, says the budget should increase allocation for infrastructure development, duly considering the capacity of financial institutions to provide funds to private sector entities.

Given the current challenges, what, in your opinion, would make for a good budget? What measures or proposals would you like to see?

  • Enhanced budgetary allocation for infrastructure development, duly considering the capacity of financial institutions to provide funds to private sector entities.
  • Finding ways to reduce the budget deficit by unlocking unused assets of government and governmental agencies, including land assets, thereby generating additional revenue. These funds should also be raised by offloading shareholdings of some of government undertakings.
  • Early implementation of GST (goods and services tax)

Given the constraints the government faces in raising revenue, do you see a case to increase income tax rates on the rich?
We need not generally increase income tax rates. However, for individuals having annual income exceeding Rs 10 crore, there could be a marginal increase in their income tax. Streamlining of taxation should be undertaken by harmonising rates of direct income tax rather than adding multiples for various levies.

If the budget does not meet expectations, do you fear that business sentiment would once again dip?
Yes.

Specific to your sector, what could the current budget do to improve conditions?
  • Provide easy access to working capital funds at low interest rates, especially for export consulting services
  • For consultants, it is difficult to pay service tax without receipt from their employers/clients for services rendered. This is causing them considerable financial constraints. It is, therefore, recommended that service tax be made payable only on receipt of payments from the employer/client.

Which budget, in the recent past, do you remember as having been a good one?
Most of the budgets in the recent past, by and large, have been lukewarm.


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