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An Eye To The Future

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Industry is looking forward to long-term economic stability and infrastructure development in the coming Budget. This is what  corporate India is expecting from the Finance Minister on 16 March. 


A.M. Muralidharan, Managing Director Volvo,India
In rapidly developing economies like India where the need for infrastructure is increasing every day with rise in population the government needs to further increase its spends in the infrastructure segment .Infrastructure is a key area which would increase employment opportunities in the country .The infrastructure investment is a key factor for India double digit economic growth.I am optimistic that 2012-13 budget will bring good cheer to the infrastructure industry considering that the government is planning to bring in huge investments in the Twelfth Five Year Plan for the infrastructure segment.  However, there was a big gap in infrastructure targets and achievements last year with slow progress in several sectors like roads construction, mining etc. The three key reasons for this weredelay in awarding projects, time and cost overruns in construction phase and potential funding shortfalls. Prevailing high interest rates and high input costs (like crude, steel, cement etc) in current scenario is hurting infrastructure sector. A key area for the Govt. to take note of is rationalizing taxes to mitigate impediments for inter-state movement of ECE and encourage ECE manufacturing in Indiabetween states. Reducing taxes on construction equipment is important because high taxes increase the cost of creating infrastructure.The VAT for construction equipment which are manufactured and bought locally in India needs to be reduced. The VAT is lower for construction equipment which is imported.

Dr Alok Bharadwaj, Senior Vice President, Canon India
There are a lot of expectations pinned to the 2012 Union Budget, due to the global supply chain disruptions, rupee devaluation, high interest and slackening of policy reforms that 2011 witnessed. For India Inc. to be able to rise and flourish, it is important that the Budget, as a statement of intent, expresses the long-term proposal for the economic stability besides radical reforms in taxation space, which the industry today yearns for. 
Aspects like, implementation schedule for GST for attracting FDI, Duty corrections like in lenses of Cameras, Removal of inverted duty structure, Withdrawal of MRP based assessment for IT Products, elimination of ambiguity on transfer pricing rules and implementation focus on manufacturing centric policies, further adoption and expansion of IT products along with help increase manufacturing of IT products along with sustained focus on education, healthcare should be a part of the immediate focus. With forward looking policy announcements & structural corrections, the 2012 budget could be a great opportunity window for finance minister to inject both sentiments & substance to growth renewal.