'Budget is not very strong on swadeshi'
Vinod Doshi
At the outset, I think it is quite a good Budget considering the present situation -- subject, of course, to reading the details of the Budget which is yet to come.
I expected the Budget to be a very tough one. But it is not
so.
One of the good points is that the insurance sector has been opened
up. It would have been better if it was opened even for the
foreign companies. Of course, the Insurance Regulatory Authority has to be in place first.
It is quite clear that the government is now seriously getting into various management and administrative actions using computers extensively.
What is disappointing is that nothing has been done for the automobile sector. The same can be said about the capital goods industry.
There could have been a little more emphasis on the budgetary provisions for the infrastructure sector, particularly roads.
However, three decisions have been taken with regard to the automobile sector: increase in the excise duty on multi-utility vehicles, increased customs duty on auto components
and increased duty on cold-rolled coils.
It was my hope that the Budget would reduce the exicse duty on passenger cars to a reasonable level of about 25 per cent and that on two-wheelers to 10 per cent. This would have given a very strong impetus to the industry.
Increasing excise duty on multi-utility vehicles is a retrograde step. One has to, however, remember that the finance minister proposes to have a single-duty system.
Whether or not the Budget is swadeshi is a matter of perception in as
much as it has all the markings of swadeshi leanings.
The finance minister has recognised the fact that a level playing field does not exist for the Indian industry and there is a distinct need for it.
I don't think, however, that the Budget is very strong on swadeshi.
I am sure that the government has taken into account the possible impact of sanctions while framing the Budget proposals. The opening up of the insurance sector appears to be a move in that direction. But it would have been more
effective if was opened to foreign companies.
Vinod Doshi, chairman, Premier Automobiles Limited, spoke on the Rediff Budget Chat.
Budget '98
|