Budget is appropriate for industry

VADODARA, July 1: The industrial sector, worried about the fall-out of the cyclone in the State on the budget, has heaved a sigh of relief w...

VADODARA, July 1: The industrial sector, worried about the fall-out of the cyclone in the State on the budget, has heaved a sigh of relief with Gujarat Finance Minister Vajubhai Vala8217;s largely generous proposals.

Speaking to Express Newsline Secretary General, Federation of Gujarat Industries, Ranjan Munshi said that the budget was 8220;appropriate8221; in view of the natural calamity Gujarat had recently faced. 8220;The Finance Minister has done a balancing act. The industries have particularly welcomed the rationalisation of the sales tax structure and stamp duty procedure. The glaring differences in the same in Gujarat and Maharashtra will now be abridged,8221; he said. Stating that the increase in outlay will benefit the economy, President of the Central Gujarat Chamber of Commerce Anuj Patel hoped that more funds will be invested in developmental activities.

8220;An insightful decision from the Finance Minister is the proposal to replace the weight based tax on motor vehicles by a 4 per cent ad-valorem tax. This will boost sale of those automobiles which were taxed more merely because of their weight while light weight cars like Opel and Honda were getting away with paltry taxation charges,8221; he said.

Patel was critical of the 2 per cent sales duty on processed food. 8220;It is against wisdom because firstly, the food is processed from waste thus reducing the waste quantity. Secondly, at a time when the food industry needs a boost we are discouraging customers from buying processed items. A large middle class population in Gujarat who can buy processed items will not do so now because of the high costs,8221; he explained.

Patel said that instead of burdening the food industry, the government should have considered investing more in the sector. 8220;Gujarat8217;s investment in this industry is only 1/3 of the states like Maharashtra and Andhra Pradesh,8221; he informed.

Agreeing with Patel, Vadodara Chamber of Commerce Secretary Nilesh Shukla said, 8220;The ministry8217;s impression of processed food as a luxurious item is wrong because almost all food items are sold in packaged form today and are consumed by a large number of middle class consumers8221;.

Shukla suggested that Vala should consider rethinking his decision and remove the additional duty on processed food.

Story continues below this ad

Expressing satisfaction with the other proposals of the budget, Shukla said, 8220;The fear that Saurashtra8217;s tragedy would bring upon more burden on the industries this time has been put to rest by the Finance Minister8221;.

Perturbed by the State Government8217;s indifference towards exporters, former president of Exim CLub T N C Rajagopalan said, 8220;There is nothing in the budget for the exporters to feel enthused about. Obviously, the State Ministry does consider this to be their job unlike the Maharashtra government where a separate Commerce Ministry is looking into the foreign trade and related aspects,8221; he said.