Less Opportunity Used For Tax Cuts In Budget: Official - June 09, 2009

The Finance Ministry has signaled the industry not to expect any major fiscal sops in the Union Budget to be presented on July 3 by the Finance Minister and has limited headroom for giveaways due to the economic downturn.

In pre-Budget consultations, senior officials of the Finance Ministry conveyed the disappointment of the government to industry for not passing the benefits excise and service tax cuts to the consumers, which was announced in December and January, a chamber official said.

However, earlier this month, the Revenue Secretary P V Bhide had convened separate meetings with industry bodies that include CII as well as FICCI and Assocham.

While, the three chambers presented the wish lists to the Finance Ministry, they were told that the new Finance Minister would not have much headroom for any more fiscal incentives. The fiscal deficit for 2009-10 is pegged at Rs 3,32,835 crore, 5.5 per cent of the GDP.

The direct tax kitty dipped to Rs 3.38 lakh crore in 2008-09 as against the truncated target of Rs 3.45 lakh crore.

The government had slashed excise duty of four per cent and service tax of two per cent across-the-board in the two stimulus packages to limit the impact of global downturn on the economy.

UPA Prepares Position In Favor Of Labour Reforms - May 28, 2009

As the Union budget is scheduled in the fist week of July, the Planning Commission is looking at the need for labour reform which could help unshackle the growth for the industry. There will be revision of Industrial Disputes Act, 1947, Contract Labour Act, 1970 and Trade Union Act, 1926 as a part of change. However, the proposed changes to be made to these laws in consultation with industry as well as trade unions.

The changed labour laws will meet the industry''s long standing demand to hire and fire workers in sync with business cycles. Then the permanent employees can be hired as contract labour while the weekly working hours will be increased to 60 from 48.

Industry leaders say that since services now account for nearly 55 per cent of India''s economy, therefore it is essential for a change in laws. The Chief Economic Advisor Arvind Virmani had submitted a report to the government three years ago, recommending the changes required in the labour laws.

The first steps of changes in labour laws are being taken. Andhra Pradesh government has already amended the contract labour law and moreover has relaxed the employment of contract workers. The labour reforms are also part of the wishlist of industry association FICCI. Besides this, CII, India''s largest industry association Confrederation of Indian Industry, has also demanded relaxation in labour laws.

Less Room Used For Strain Cuts Into Financial Statement: Official - May 23, 2009

The Finance Ministry has told industry to not to expect any major fiscal sops in the Budget to be presented by the new UPA government. In pre-Budget consultations, senior Finance Ministry officials conveyed the government''s disappointment to industry for not passing to consumers the benefit of excise and service tax cuts announced in December and January, a chamber official said.

Revenue Secretary P V Bhide had convened separate meetings with industry bodies - CII, FICCI and Assocham - earlier this month.

While, the three chambers presented wish lists to the Finance Ministry, they were told that new Finance Minister would not have much headroom for any more fiscal incentives which the industry wants for boosting the economic activity.

The fiscal deficit for 2009-10 is pegged at Rs 3,32,835 crore, 5.5 per cent of the GDP. The revenue was impacted in the last fiscal as industrial production fell.

India Achieve An Average Of 8-9 Per Cent Growth - Aug 09 , 2008

In the next 12 months, India will achieve an average of 8-9 per cent growth, and in the remaining four years of the 11th Plan, it will clock 9 per cent, Arvind Virmani, Chief Economic Advisor of the Union Finance Ministry, has said. Delivering his keynote address at a session on the ''State of the Indian Economy'' organised by the Confederation of Indian Industry (CII) here on Thursday, he said: "Don''t get confused by the cyclical trends and projections. We have not revised the range. After the release of the Index of Industrial Production (IIP) figure, we may revise it.

At present, our priority is to control inflation. However, I am confident that the growth will be in the bottom range of 8 per cent for the current year and an average of 9 per cent will be met by the 11th Plan Period. In the next 12 months, inflation will be in the range of 5-6 per cent"

CII Says Exports To Reach $200bn By 2009

New Delhi: India''s total export of merchandise goods will attain $200 billion in 2009, implying that exports will register more than 20 per cent growth for all the five years of the policy (2004-09). This has been pointed in a CEO survey conducted by the Confederation of Indian Industry (CII) on the Foreign Trade Policy. CII members are of the view that India will become a major player in the global market if the Government ensures stability with no mid-term changes to the policy. They seek schemes such as Duty Entitlement Pass Book (DEPB), Export Promotion Capital Goods (EPCG) and Duty Free Import Authorisation (DFIA) to continue.

The CEOs wanted the annual supplement to focus on issues like modifying export and import procedures for small and medium enterprises, which contribute a large portion of total exports from the country. The survey recommends that exporters are looking for new export promotion schemes to promote export of goods and services and completely exclude duties and taxes. Competition in global markets, according to the survey, for Indian products are from China, Romania, Brazil, Sweden, France, Vietnam Bangladesh and ASEAN countries. The products that face intense competition include capital goods, high-tech products, healthcare products, medical equipment, automobile and information technology.

CII Snap Poll Says GDP Hopes To Be 8-8.5pc

New Delhi: The Confederation of Indian Industry''s CEOs snap poll on the macro-economic outlook for the economy in 2008-09 said that 50 per cent of the participants hoped GDP growth to be in the range of 8.0 per cent to 8.5 per cent. Another 41 per cent of the CEOs felt that the GDP growth is expected to be in the range of 8.5 per cent to 9 per cent. With regard to inflation, 68 per cent of the CEOs estimated it to be in the range of 4 to 5 percent during the year. Considering the budget declarations and the prevailing macro-economic conditions, 79 per cent of the CEOs hoped increased investments in the economy.

Budget Inclusive And Balanced One: CII

PUDUCHERRY: The Confederation of Indian Industry (CII) Puducherry, has described the union budget as `an inclusive and balanced` one.

In a press release here today, CII chairman C Chinnasamy said that the budget has focussed on growth in crucial sectors like Agriculture, education, health and defence. The increased allocation of funds for these sectors and announcement of new schemes and projects would boost the economy, he said.

The hike in exemption limit in Income tax and also cut in excise duties imposed on cars would improve the lifestyle of the people, he said.

Vice Chairman of CII (Puducherry) Sriram Subramany however pointed out that the industry's expectation on some reduction in corporate tax in the budget had been belied.

He said all export companies also anticipated concessions in view of the rupee appreciation and global recession. This had not come true.

Shriram Subramany said waiver of loans from farmers to the extent of Rs 60,000 crore was most welcome and also necessary. The raising of exemption limit for Income Tax assessees was also a step in the right direction as it would help the urban middle class people across the country, he said.

CII Reports Marginal Decline In Sectors Showing Negative Growth

New Delhi: Out of a total of 100 sectors reporting production, 15 sectors registered a growth rate of over 20 per cent and 30 sectors recorded a growth rate of 10-20 per cent, reported the Confederation of Indian Industry (CII) Ascon survey for April-December 2007 compared to April-December 2006. The survey, which tracks the performance of various manufacturing sectors of industry, revealed that although the sectors showing excellent growth had declined compared to the last quarter, the number of sectors showing high growth have moderately increased for the same period. The percentage continued the same for the moderate category and percentage of sectors in negative category showed slight decline for April-December 2007. It is heartening to see the slight fall in the sectors showing negative growth and modest increase high growth sectors, but we still need to be cautious and work with the Government to speed up the growth rate of manufacturing.

The excellent growth category included electricals such as circuit breakers, power transformers, transmission line towers and power cables along with rubbers hoses. Soya oil, asbestos cement, industrial valves, abrasives with electrical fans were all in the high growth category. According to the survey, cement, motor stamping, energy metre, capacitors, auto components, ball and roller bearing, polymer, edible oil and textile machinery have shown moderate growth while fertiliser, switchgears, and motor cycles were in the negative growth category.

FICCI, CII Asks For Rate Cut

New Delhi: Taking a cue from the US Federal Reserve which cut the interest rates by 75 basis points, the Fedearation of Indian Chamber of Commerce and Industry and the Confederation of Indian Industry have asked the Reserve Bank of India to signal interest rates cuts by 25-50 basis points. With inflation under control and balanced around three per cent, it is the right time for the RBI to cut repo and reverse repo rates that are currently at 7.75 per cent and six per cent respectively by 25-50 basis points to cover the relative competitive disadvantage India has on the macro economic fundamentals.