Budget Outlook/Opinions Interim Budget: A Balancing Act for India's Manufacturing Industry?
The Interim Budget announced recently by Finance Minister P Chidambaram has evoked mixed reactions from different industry segments. While some have hailed it as a balanced approach and believe that the suggested measures would give a boost to the manufacturing sector, others consider it a neutral one, with no major impact on industry. Here is what some industry veterans opine…
Samit Jain - Director, Pluss Polymers: “This Interim Budget is important as India fights its way back to greater than 8 per cent growth trajectory. A significant boost to the industry is needed and the government scored brownie points by reducing the excise duty on select capital goods. It will have a ripple effect on the ancillaries to the automotive industry as the demand for automobiles will increase. This will provide a much-needed boost to the manufacturing sector.
However, it was again unfortunate that no specific timeline was given for introduction of GST. A multitude of agencies and taxes continue to impede SME growth. Taxes have to be streamlined for the industry to conduct business smoothly. The country needs to focus on innovation to solve its unique problems and this has to come from SMEs. The government should come up with innovative policies so that SMEs can thrive in this globalized world.”
“Support Required to Become Globally Competitive”
Dr Chandan Chowdhury - Managing Director-India, Dassault Systèmes: “Our manufacturing sector has been facing many challenges and its growth has been stagnant. It is heartening to see the emphasis this vote-on-account puts on the criticality of manufacturing sector for the growth of the Indian economy. If the manufacturing sector has to contribute 25 per cent to India’s GDP, we need to reengineer our processes through technologyenabled innovation.
The manufacturing sector would also require government support to become globally competitive. India needs to graduate to an innovation-centric economy if it has to move to the next level of growth. The vote-onaccount clearly reiterated the relevance of innovation by sharing plans for the Innovation Fund being made viable for MSMEs in India, which form the backbone of the Indian economy.”