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Budget reactions | Industry hails Budget 2011

Budget reactions | Industry hails Budget 2011

Adi Godrej, Chairman, Godrej Group

Expressing satisfaction over the various proposals of the Budget, Godrej Group Chairman Adi Godrej said: “I think it was a very well balanced Budget and growth oriented. It will be very good for the economy. The decision to formally introduce the constitutional amendment for GST is a very good one."

He said increase in limit for income tax exemption for tax payers will add to consumption “which is desirable".

Chanda Kochhar, MD & CEO, ICICI Bank

The Union Budget for FY2012 is a growth oriented budget that seeks to build on India’s strengths and to address the challenges that we face. In line with this approach, the budget seeks to build on our growth drivers through infrastructure and social sector development, address challenges of food inflation and of fiscal management and to promote inclusive growth.

The budget focuses on areas requiring significant investments, while seeking to take forward the process of fiscal consolidation. The priority accorded to achieving greater economic inclusion and addressing the challenges that we face will stand the economy in good stead as it reverts to a sustained high growth path.

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Anil Sardana, Managing Director, Tata Power

While the Hon. Finance Minister’s outlined the theme of the Union budget 2012 by saying that food inflation is a key area of concern and that strong fiscal consolidation is necessary, the budget seems to be a mixed bag for power sector.

We appreciate the steps taken to attract investments in power and infrastructure sector through measures like introduction of tax-free bonds of 30,000 crores; lowering Withholding tax of 5% for notified Infra funds; raising FIIs limit in Corporate Bonds for investment in infrastructure and extending Tax SOPS on infrastructure bond by a year, to support the growth aspirations.

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Habil Khorakiwala , Chairman , Wockhardt Group

Growth through a balancing act . The finance minister has presented a budget that is growth oriented. He has made an attempt to integrate the rural economy with the urban economy.

The budget has a major focus on agriculture, infrastructure, education and banking and finance but it is a disappointment for healthcare which is a key sector that requires a major thrust from the government.

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Indranil Pan, Chief Economist, Kotak Mahindra Bank

This Budget seeks to do a rope-trick in terms of sustaining the growth momentum in the economy. Hence the Finance Minister was hesitant to roll back the balance of the fiscal stimulus that was implemented in the post-Lehman crisis period. Thus the excise duties and the services taxes were not rolled back to the pre-Lehman levels of 12% from the current 10% mark.

We view the overall budget as being short on taking forward key reforms measures – such as relaxation to FDI limits, a clear road-map for GST etc. We expect that achieving this fiscal target could be difficult in light of likely higher subsidy bills (especially on fuel) when compared to BE 2012."

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Sajjan Jindal, VC & MD, JSW Steel

It’s a skillfully balanced budget. The finance minister has struck a fine balance between growth and inflation and has also given a strong indication of continuing on the reform path.

Tax reforms are also being heralded and the DTC will be finalized in 2011-12.Significant progress has also been made on GST and I am hopeful of this getting through sooner than later.

The hike on export duty on iron ore fines and lumps to 20% advalorem is most welcome. I am sure that this will lead to greater value addition at home and encourage the domestic steel industry.

Anish Shah, President & CEO, GE Capital India

The 23% increase in allocation on infrastructure is the key takeaway for me in this year’s Budget proposal. There are several direct and indirect measure to boost infrastructure development and rightly so.

The increase in limit for FII participation in infrastructure bonds, and the move to reduce withholding tax to attract foreign debt funds in the infrastructure sector are highly positive developments.

Overall this is a functional Budget. With the continuation of fiscal stimulus and if some of the key proposals for infrastructure development are carried out well, the private sector should see good growth opportunities in the coming year.

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Y C Deveshwar, Chairman, ITC Limited

The Finance Minister has done a brilliant job of balancing the challenges confronting the economy and the opportunities that can ignite faster growth and progress of the country. He has sought to consolidate the fiscal deficit through growth stimulated by moderation in taxes thereby encouraging savings and investment.

In addition, the Finance Minister has provided a strong impetus to inclusive growth by significantly investing in the long term drivers of the economy such as education, skill development, infrastructure and development of the rural economy.

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