Karnataka Govt To Conduct Global Investors Meet In Jan ''09 - July 8, 2008

The Karnataka government is mulling to organise a global investors'' meet in January 2009 on the replica of the one held recently in Gujarat. The state targets to project tier-2 and tier-3 cities as the new growth centres to the prospective investors, Murugesh R Nirani, minister for large and medium industries, said. The government will concentrate on attracting investment to steel, cement, food processing, ITT and automobile sectors. The government have already approved 65 investment proposals comprising an investment of Rs 1,062 crore via the single window clearance committee. Through the proposed global investors'' meet, the state will attempt to attract investment proposals in the order of Rs 500,000 crore.

The high powered panel to approve mega investment projects has received 36 major investment proposals worth Rs 50,000 crore which will be approved during the meeting of the committee chaired by chief minister B S Yeddyurappa during the first week of August. The state government proposes to build an industrial corridor along the Bidar-Hyderabad national highway. This corridor, stretching over 500 km, will be developed on the models of Chennai-Bangalore-Mumbai industrial corridor which has already been cleared by the Central government. The government is setting up a task force to develop a blue print for the proposed setting up of special economic zone steel, cement, food processing, automobile and ITT parks.

Small Investors Expect Populist Budget

The UPA''s Finance Minster is expected to deliver a populist budget and so the demands are running high. The small investors are hopeful of a tax cut. At present, income up to Rs 1,10,000 for men and Rs 1,45,000 for women attracts no tax. Experts feel that this threshold can be increased by another Rs 40,000. Since incomes have also risen significantly, the highest tax rate of 30 per cent should be applicable to salaries above Rs five lakh against the current Rs 2,50,00. This could translate into a cool saving of Rs 40,000.

Another way to save on tax is to invest up to Rs one lakh into tax saving instruments. Investors want their limit to be hiked but they are also demanding that the government should extend tax saving sops to a wide variety of options. Investors are also demanding that interest on fixed deposit savings should become tax free and MFs across the board should get a tax saving waiver instead of restricting this option only to ELSS schemes.

Even if you increase tax slab, it will definitely help. Secondly, mutual fund as a method of saving is becoming more popular. It is an opportunity to create wealth and not just an avenue for savings or short-term speculation. Having burnt their fingers in the recent market correction, small investors would be looking for a silver lining in this year''s budget. A cut in income tax rates is what everyone is expecting but at the same time, more money in the hands of investors, whether invested or spent, will also help spur growth.