Budget balanced, non-disruptive

Managing director, Tata Steel

I rate the Union Budget FY12 as a balanced Budget and a Budget that is non-disruptive. The FM is continuing with the policies of the government since it came to power, keeping the focus on growth and inclusiveness. The Budget has to be seen in the context of the measures already announced and I am sure there will be several other measures that the government will announce progressively to ensure that the economy exceeds the 9% GDP level at the earliest. The government’s target GDP growth rate of 9% and commitment to bring down fiscal deficit to 4.6% of GDP for FY2011-12 and 3.5% of GDP by FY2014 are statements that hold a lot of promise. There has been a positive change in the quantum of fiscal deficit for FY 2010-11, which was at 5.1% of GDP against the previous budget estimate of 5.5%. The FM affirmed his resolve to introduce DTC from April 1, 2012. However, as regards GST, the rollout, including constitutional amendment, is still in progress.

The increase in MAT rate, when it is felt that it is already high, would not have a beneficial effect on the industry, although this would be marginally offset by the reduction in surcharge. The imposition of MAT on SEZ developers will have an adverse effect on SEZs. The focus on infrastructure sector is in keeping with India’s insatiable need for enhanced infrastructure. Industries like steel, that have high capital outlays and also have high contribution

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