The Indian IT industry has expressed a positive stance about the Interim Budget 2014-15 floored by Finance Minister Chidambaram today in Lok Sabha. His measures to contain the fiscal deficit has boosted the hopes in the industry, though he could not do much on income tax and other important issues because of it being an interim budget. He tried to take measures to boost the domestic manufacturing in the country.
"In general the outlook of the economy has reflected. The budget looks positive. There is no specific impact on IT industry. However, the MSME inclusive innovation fund looks very interesting, with the amount of corpus earmarked for the same. Given its stated charter, this may help seed and grow more incubators with support for startups that solve the bottom-of-pyramid and/or social problems," says Ramesh Loganathan, Vice President and Centre Head, Progress Software.
But the industry does not refrain from expressing displeasure on the food subsidies which are having an impact on the overall growth of the industry and the country.
"In my opinion, keeping a tight control on fiscal deficit to 4.6% of GDP is a good step from macroeconomic point of view. However, overshooting non-plan expenditure is a bad signal for the economy. Food inflation will hit the common man most and decelerating industrial growth is a major cause of worry. Overall the Finance Minister wants to keep middle class happy by reducing excise duty on small cars and SUVs. There is no significant mention about telecom. But the Finance Minister has proposed a higher import duty on foreign made mobile handsets to encourage domestic production. All the major national handset manufacturers are sourcing the components from China, Taiwan, and Vietnam etc. I am not sure whether the higher import duty is applicable even on CKDs (Complete Knock downs) also or not. Finally, liberalized FDI is not going to give us expected results unless and until there is clarity on certain existing debates like Vodafone tax case etc. If the clarity is brought in then international investors shall have full confidence in our systems," opines Debasis Chatterji, CEO, Netxcell Limited
"In my opinion, keeping a tight control on fiscal deficit to 4.6% of GDP is a good step from macroeconomic point of view. However, overshooting non-plan expenditure is a bad signal for the economy. Food inflation will hit the common man most and decelerating industrial growth is a major cause of worry. Overall the Finance Minister wants to keep middle class happy by reducing excise duty on small cars and SUVs. There is no significant mention about telecom. But the Finance Minister has proposed a higher import duty on foreign made mobile handsets to encourage domestic production. All the major national handset manufacturers are sourcing the components from China, Taiwan, and Vietnam etc. I am not sure whether the higher import duty is applicable even on CKDs (Complete Knock downs) also or not. Finally, liberalized FDI is not going to give us expected results unless and until there is clarity on certain existing debates like Vodafone tax case etc. If the clarity is brought in then international investors shall have full confidence in our systems," opines Debasis Chatterji, CEO, Netxcell Limited
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