Industry Expectations - Budget 2008
Mr.P.L.Ahuja, MD & CEO - Bank of Rajasthan
 WISH LIST :
The Budget 2008 holds the key for the growth of Indian economy that has speeded up over the past few years. As Government has assured for its social economy enlistment programme, AS-15 needs to be addressed in a big way. If Government removes the upper cap de-links the ceiling on pension, gratuity, leave encashment like superannuation benefits across the board, this will be of a great help.
When infrastructure development has taken the speed to boost it ahead, Government may float infrastructure bonds with special tax treaty. Banks may also be allowed to float such bonds to generate enough resources for placing it in public and private infrastructure development programmes. Last two year’s GDP growth of 8 to 9% is the result of such developments and if the Government wants the rate of growth to be maintained, higher spending on infrastructure development needs to be given top priority. On infrastructure front, power sector and the interconnection of rural areas by road/rail/aviation needs to be attended on front footing.
OUTLOOK :
Focus on improving financing options for infrastructure development by a possible inclusion of infrastructure sector as part of 'priority sector', increased viability gap and/or tax exemption on infrastructure bonds and/or more liberal norms on external commercial borrowings for infrastructure projects are some of the measures that need attention.
Going from any direction, financial sector will play an important role in such developments and hence the Budget is expected to favor the financial sector in general and the banking industry in particular. Higher spending on education and employment generation will create better environment in faster economic development going forward. Export oriented industry too needs to be given some relief in the wake of hardening rupee.
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