Indian Budget 2013 India's Budget and the Process Industry: What Top Honchos Expect for 2013
With the budget round the corner, we asked industry veterans their expectations from it. Here are a few recommendations, suggestions that they would like to see materialize in this year’s budget…
A V Suresh CEO - Forbes Professional, Eureka Forbes
“India is going through a tough period though we have rich resource of men, market and skills. Going by the current trend it suggests that we will end the year with a GDP growth of less than 5 per cent. Blaming the global slowdown is not the answer; instead we need transparent processes in place. The government needs to spend its revenue purposefully and strengthen the Rupee. Imports have to be made less costly especially for critical components, which are most needed in the process industry.
The recently announced foreign investment has not materialized and global investors are looking for improved system governance and we need to put efforts into improving our credibility. Faster clearance of infrastructure projects is needed and industry-friendly policies are required to prop up the industrial segment. To augment fiscal, revenue and current account deficits India needs large investments complimented by bold reforms and robust growth.”
Mahesh Rao Managing Director, Nalco Water India
“India is a growing economy. The use of industrial water is closely linked to the economy of any country. As the GDP increases, so will the consumption of industrial water. In India, the industrial sector is the second highest user of water after agriculture. The World Bank says that the demand for water for industrial use and energy production will grow at a rate of 4.2 per cent every year, rising from 67 billion cubic meters in 1999 to 228 billion cubic meters by 2025. It adds that the current use of industrial water in India is about 13 per cent of the total fresh water in the country. Water supply and prices associated with it
have been emerging as the major constraints to the growth of industries.
Like in many other parts of the world, India should look at implementing incentive driven norms and stricter laws to ensure the responsible use of water. We look forward to announcements on incentives and funding for water re-use through tax measures this year. Tax credits and exemptions, as well as grants, can be used to improve the economics of investment in water reuse, while tax assessments may be used to help finance public water reuse systems or infrastructure.
The government should have a tax credit that is equal to a percentage of fixed capital expenditure on projects, or activities that reduce the consumption of potable water. This incentive can be provided under the country’s Economic Expansion Incentives (Relief from Income Tax) Act as a part of an incentive “package” for a particular project. This is already being followed in Singapore and has proved to be a successful model.”