The Budget offers nothing by way of deliverance to the economy from massive supply-side constraints, says V.K. Mathews, Chairman of CII Kerala Council.
He said this while addressing a panel discussion held as part of Budget analysis hosted by KPMG, Asian School of Business and CII.
What with inflation overhang, he doubted if exports will grow at the projected clip and tax collections become buoyant to drive 6.1 to 6.7 per cent.
Chidambaram’s predecessor had short-circuited the exports sector, which continues to be devoid of incentives it requires.
Worsened twin-deficit scenario has effectively eroded the competitiveness of the economy; the Budget offers little to reverse it.
Also Executive Chairman of IBS Software, Mathews said the Finance Minister ignored the IT sector pleas on SEZ policy and minimum alternate tax.
He was also sore that nothing concrete has been done to promote innovation hubs in the country.
C. Balagopal, Managing Director, Terumo Penpol, was of the view that it is futile to expect that miracles would happen with every Budget.
UNDOING DAMAGE
If Chidambaram had to do achieve something, it was to undo the damage to the economy inflicted by his predecessor.
But the extent of damage was too bad, which ruled out salvaging operation from taking effect in such short time.
Public services – drinking water, power, transport - continue to be in a shambles. There is nothing that the Budget offers to do here.
Healthcare and education are two other areas crying for attention, Balagopal said.
Less than one per cent of GDP is allocated for healthcare in a country, 75 per cent of whose population has no access to improved services.
“Mere numbers don’t tell all. Neither can they hide glaring issues relating to basic governance and public services,” he added.