Pranaba’s dignified dig at his predecessor for not including Legal services in services tax net has mostly gone unnoticed. However, the style in which Pranabji attempted to restore equity by bringing legal practices for organizations in services tax net excluding individual litigants speaks of, a great deal of substance which the leader of opposition must emulate. Voicing dissent objectively with a spirit of accommodation, even inside the cabinet displays rare confidence of UPA Govt. in its second innings and statesmanship of finance minister; doing away with unproductive, unpopular taxes like FBT & CTT tells you that the govt. has rightly got its ears to the ground. The pre budget consultation with state finance minister was a step in right direction keeping in view our federal setup. Pranabda has got a huge sixer in his opening of batting in the finance ministry in 09’; deserves a standing ovation.
The huge outlay in rural and agriculture sector could be termed as a huge gamble by armchair economist but if you look closely, then you would see a very smart mind and an astute politician is at work. Paranabda has rightly chosen to follow the footsteps of great strategist of ancient times Kautiliya. In the current economic condition it is prudent for the finance minister to attempt to drive the Rural-Agriculture economy with continuing patronage in liberal outlay and sound provision of hundred percent exemption in direct taxes for corporate to attract private capital in rural infrastructure sector (Cold Storage & Warehousing Ect.). The idea apparently is to grow the agriculture sector beyond five percent and creation of buoyant demand in rural areas for the industrial sector to a speedy recovery from external recessionary pressures. The emphasis on infrastructure, urban housing would stimulate consumption apart from making lives easier and increasing the competitiveness of the economy by reducing the transaction time in the business. The road map for Goods and Services Tax adds confidence in the Govt.’s intent to revitalize the economy by prudent reforms where ever the need be. Higher allocation for innovation, research and climate change in spite of constraints of resources reflects UPA govt.’s concern for sustainable development and earlier thrust on rural-agriculture sector & urban housing is just right policies for a progressive fiscal policy for an effort towards equitable distribution of wealth for creating a harmonious and peaceful society in the long run.
Confederation of Indian Industry has duly expressed its concern regarding the quality of execution that would make all the difference by the turn of budget 2010. However, if the Prime Minister and Finance minister stuck to their guns regarding periodic evaluation of projects and central govt. departments apart from a few inspiring words from the Govt. would do the trick and hopefully Pranabda would go laughing way to the bank-over a 10% growth in GDP.
Author: Bikash Choudhury, Chief Executive of Strategy Consulting Firm based at Bhubaneswar Orissa , India Mobile
Email: streben.market@gmail.com & bikashchoudhury@sify.com
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