'An inflationary Budget which will not encourage consumer spending'
Kiran Majumdar Shaw
A disappointing Budget, which really does not promise to "kick-start" the
economy or, for that matter, infuse investor confidence as is evidenced by
the drop in the stock market.
It is a very inflationary Budget which
will not encourage consumer spending. Merely reducing capital gains
cannnot infuse investor confidence, and I would have liked to have seen
some good tax incentives on R&D spending and patent-related spending as
well.
India has a great potential in biotechnology -- and biopesticides is
not biotechnology!!
Increasing import duties across the board will certainly not protect
Indian industry from the highly devalued exports from the depressed
Asian countries and China. Anti-dumping duties would have been more
relevant.
As far as cutting red tape goes, I have no details of the plan, but the red tape
cutting execise is already in an operational mode, and it will certainly
help to do away with more red tape -- but what we need are strong economic
measures as well, to boost the economy.
Increasing import duties is, in my
opinion, detrimental to kick-starting the economy as it will only
increase production costs.
I don't see how they have made things any different to boost exports
with, but yes, exports is definitely the way forward. We need simplified
procedures and better infrastructure to deal with exports and this has
not been addressed.
I think the industrialists
are quite unhappy, especially the processed food sector where excise
duties have gone up. Even the automobile sector, which expected some
relief, will be very disappointed. As for the economists, I think they
need to do some real re-thinking on this insipid Budget. We need a
push forward at missile speed, not at bullockcart speed!
I expected a lot more from Yashwant Sinha and from the BJP. We just
haven't taken advantage of the crisis in Asia, and instead opted to
almost join the bandwagon!
Come on, Mr Sinha, you could have been much
more pragmatic rather than just address the agriculture sector and corporate
and individual taxes, NRIs and the Film industry!
In
a nutshell, like I mentioned earlier, the BJP government's first Budget
was disappointing and insipid!
Kiran Majumdar Shaw, chairman and managing director, Biocon, spoke on The Rediff Budget Chat.
Budget '98
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