01 February, 2018, Bengaluru: At a panel discussion hosted by IIM Bangalore on February 1, 2018, post the Budget being presented by the Union Finance Minister Arun Jaitley earlier in the day, industry watchers hail the emphasis on health and agriculture but express concern about tax payers and corporates being ignored.
The expert panel comprised V K Viswanathan, Chairman, Board of Bosch Limited, S Raghavan, on the Board, L&T Finance Limited and Surin Automotive Private Limited, B. P. Rao, Founder & Senior Partner, M/s B. P. Rao & Co., Chartered Accountants, Jagdish Ahuja, former President, Bangalore Stock Exchange and Founder, Capital Market Academy, Wealth Mastery Trainings, and Prof. Charan Singh.
(L-R) S Raghavan,Former Board of L&T Finance, V K Viswanathan, Chairman, Bosch, Prof Charan Singh, Economics & Social Sciences, IIMB,Jagdish Ahuja, Market Analyst and B P Rao, Chartered Accountant, Founder of B.P.RAO & Co during the Expert Panel on Budget 2018 on February 01, 2018
V K Viswanathan observed that the budget was good for farmers and small enterprises, but added that, “Reduction in tax rates for large corporates as promised earlier by the Finance Minister has not come through. Instead, incentives have already been withdrawn or are being reduced. This will make India Inc. uncompetitive particularly against the backdrop of steep reduction in taxes announced recently by the Trump administration.”
Highlighting the fact that in the last 18 months, there has been a high level of increase of import taxes, partly to give protection to domestic industries, he remarked competitiveness should not come at the cost of long-term consumer oriented policies. “Inefficiency should not be allowed to creep in in the corporate sector.”
S Raghavan focused on budget implications for the domestic industry. “A lot of infrastructure investment is on the anvil, whether it is the rural, or education and social sector. But still, it is a small percentage of the GDP and that is a concern. We are not investing adequately to regenerate the dwindling infrastructure. Moreover, industry requires a consistent policy of taxation. Provisions for R&D infrastructure could have been better,” he explained.
Calling Budget 2018 a “feel-good budget” for its focus on infrastructural investment, and investment in rural areas, he was quick to point out that it had addressed the concerns of the future of the country.
Hailing the budget for focusing on health, agriculture, rural employment and infrastructure, B.P. Rao even said the Long Term Capital Gains Tax was “a good thing”.
Jagdish Ahuja added that “the soul of India, which lies in its villages, has been addressed in this budget” but lamented that the budget had “ignored the stock market, which is the engine of the country’s growth”. Pointing out that tax exemption for corporates was not enough, Ahuja added, “We do have a need for infrastructure and healthcare, but the needs of tax payers have not been addressed. The capital market has had a rude shock.”
The panel of industry watchers, analyzing the Union Budget, was moderated by Professor Charan Singh from the Economics and Social Sciences area at IIMB. The panel discussion was followed by a Q&A session. This was the last complete budget of the current Central Government, and therefore special, because it will have implications for the assembly polls in 2018 in Chhattisgarh, Karnataka, Madhya Pradesh, Meghalaya, Mizoram, Nagaland, Rajasthan and Tripura, and most importantly, for Lok Sabha elections expected in March/April 2019.
Prof. Charan Singh lauded the schemes launched for healthcare and infrastructure development, but added that the budget could have done better to encourage cottage industries. “MSMEs need to play a major role in the country’s economy, so more research and development on MSME products are needed. Like every state has an agriculture university, we also need MSME universities in all states,” he said.
