Date:02/03/2006 URL: http://www.thehindubusinessline.com/2006/03/02/stories/2006030200011900.htm

Back Status quo Budget, say AP industry chambers

Our Bureau

Hyderabad , March 1

It was a mixed bag of opinions from the chambers of industry and commerce here on the Union Budget for 2006-07 presented by Mr P. Chidambaram, Finance Minister, on Tuesday in Parliament.

The Federation of Andhra Pradesh Chambers of Commerce and Industry (FAPCCI), the Confederation of Indian Industry (CII), the Federation of Indian Chambers of Commerce and Industry (FICCI) have welcomed, in general, "the growth-oriented Budget".

They, however, expressed their disappointment on issues like non-removal of FBT (Fringe Benefit Tax), neglect of PSU reforms and disinvestments and silence on phasing out of CST (Central Sales Tax).

While welcoming the Budget for curtailing the fiscal deficit, Mr C.V. Atchut Rao, President of FAPCCI, said it was disappointing as the CST had not been reduced to two per cent. Terming it a `status quo' Budget, he said there was not much encouragement to the industry.

Mr C. Parthasarathy, Chairman of FICCI (Andhra Pradesh Council), said the clear cut signal for Goods and Services Tax (GST) by 2010 was a bold step and would help in making India one common market.

Mr M. Gopalakrishna, Convenor of Economic Council of CII (AP), said it was a welcome step to increase the Plan outlay significantly. Availability of farm credit at lower rates would make cost of cultivation less. He felt that the Minister should have spelt out on policies to increase exports and developing the SME (small and medium enterprises) segment.

While welcoming the Budget, Dr Vivekanand, Vice-Chairman of CII (Andhra Pradesh), and Managing Director of Visaka Industries Ltd, said adequate thrust has been given for food processing industry and infrastructure.

Mr D.V. Manohar, past Chairman of CII (AP) and Chairman of Sri Shakti Group of companies, said the Minister made a balancing act. He, however, added that the Minister had been cautious and conservative. "Expectations of the people and industry were high as the economy is booming," he said. It was disappointing that there was no hope on CST phasing out and SME development.