The Union Budget 2015-16 encourages economic and businesses’ confidence with fine tuning of socio economic policies and announcement of some steady reforms, said Mr. Alok B Shriram, President, PHD Chamber.
Reforms in corporate tax structure; reducing it from 30% to 25% in the next 4 years, funds for infrastructure; rural infrastructure and agriculture credit and deferment of GARR by 2 years are good steps and would go a long way to help Indian economy grow strength to strength in the coming times, said Mr Shriram.
However, we were expecting more in MSMEs segment in terms of its scalability and financial problems. The high expectations on reduction in MAT have also remained unfulfilled. Increase in services tax can have impact on the ever expanding services sector trajectory as the costs of services are going to rise, said Mr. Shriram.
The focus on reducing the demand for overseas gold with gold monetisation scheme including gold coin with Ashok Chakra will help recycle domestic gold and curtail gold imports. Sovereign gold bonds will lead to channelize physical investments in gold to financial investments, said Mr. Shriram.
The budget rightly addresses the policy environment & provides roadmap for growth prospects, said Mr. Shriram.
Roadmap for GST implementation before April 2016 is a potential game changer, he said
Estimated GDP at 8-8.5% in 2015-16 is encouraging and we expect the economy to attain double digit growth trajectory in the medium term, he added
Six crore housing units in rural and urban areas by 2020 would improve the standard of living of the people and generate demand in the rural economy and rejuvenate the construction industry.
Completing one lakh km of road would address the problem of connectivity in the country and enhance the level of urbanization, going forward.
Allocating Rs 5,300 cr for micro-irrigation schemes would reduce the dependence of farmers on the monsoon and facilitate the growth of agriculture sector.
Allocation of Rs 25,000 cr for rural infrastructure would generate the ripple effect in terms of employment generation, raising of per capita income and overall quality of life. It will lead to re-fuel rural demand and help manufacturing sector to attain growth.
Focus on improving MNREGA with allocation of Rs. 34,699 crore is a step in the right direction as the scheme has helped rural demand to remain at the threshold level during the period of economic slowdown.
Allocation of Rs 20,000 cr for Mudra Bank for SMEs would help the growth of MSMEs and would address the financial problems of this sector to a certain extent.
Government focus on to cut subsidies leakages is an inspiring step as the subsidies would become meaningful and fruitful & rationalized.
Rs. 8.5 lakh crores of agriculture credit envisaged during the 2015-16 would help the farmers to adopt new technologies in the Agricultural crops production and diversification of the crops system.
National Investments and Infrastructure Fund (NIIF) with an annual flow of Rs. 20,000 crores would help infrastructure sector’s problems to a certain extent and has the potential to attract more private sector investments.
Focus on Green India with alternative sources of energy such as target of renewable energy capacities to 175000 MW till 2022 is inspiring and would lead to help attain energy security going forward.
Battle to combat ‘Black Money’ must be continued and the new Acts are welcome. However, due care is to be taken to ensure no misuse or harassment to honest tax payer. Additional commercial courts are welcome to speed up conflict resolution, said Mr. Alok Shriram.