The Hindu Business Line : Wednesday, March 01, 2006

Rice processing
Rice processing companies, such as Satnam Overseas, Lakshmi Overseas and KRBL may benefit from "priority sector" status to the food processing industry. NABARD is also to create a Rs 1,000 crore window for providing ... More

INVESTMENTS

The lure of equity despite stretched valuation — Bias in favour of investments in MFs, insurance
Last year, the Finance Minister had talked about a road map for moving towards an EET system - meaning investments would earn tax rebates at the time of investment, income from such investments would be exempt while proceeds received on ... More

TELECOMMUNICATIONS

No cheer for telecom users, service providers — Now, service tax on Net telephony
Telecom consumers and service providers have little to cheer from the Budget 2006-07 today. While the telecom industry was expecting a reduction in the licence fee paid as a percentage of the annual revenue, the Finance Ministry's proposal to ... More

AIRLINES

Domestic airlines get tax exemption for 1 more year
The Union Budget 2006-07 has provided some relief to the domestic aviation sector while international air travel and travel by cruise ships is set to become slightly more expensive. The Budget has extended the exemption for domestic airlines on ... More

A new lease
Domestic airlines, such as Jet Airways, Indian Airlines, Spicejet and Air Deccan, will now enjoy one more year of tax exemption on lease rentals paid to foreign lessors for their aircraft. The tax exemption on lease ... More

BUDGET

Budget goes pro-investment; new taxes kept to minimum — FBT modified; small cars to cost less on duty cut; tobacco taxed
The Rs 10,000 limit for contributions to some pension funds eligible for exemption under Section 80 CCC is to go and such contributions are also to be included within the Rs 1 lakh limit More

Boost to investment activity — Govt totally committed to fiscal prudence and continued reforms: Chidambaram
Mr Chidambaran said he did not understand the industry's worry over the tax being a cumbersome one since the first returns on FBT was due only by October 2006. More

Central Plan outlay put at Rs 2,54,041 cr — Energy, social services & transport corner major chunk
The Budget has proposed a higher Central Plan outlay of Rs 2,54,041 crore for the next fiscal, compared to budgeted Rs 2,11,253 crore in the current fiscal, marking a growth of 20 per cent, with energy, social services and transport accounting ... More

Pay for more services
In 2005-06, the services sector is estimated to contribute 54 per cent of GDP. Naturally, it should also contribute significantly to the exchequer. Continuing in the direction followed in the last few years, I propose to bring more services under ... More

Metals: Reflected lustre
Duty cuts
Import duty on primary and secondary non-ferrous metals cut from 10 to 7.5 per cent
Restoration of 5 per cent duty on import of steel melting scrap
Reduction of duties on ores and concentrates from 5 to 2 per cent More

Big bonanza for the small car
On fast track
Small cars account for three out of four cars sold in the country
The Swift and the Indica petrol version will not qualify for the benefit
Input prices likely to soften on lower import duties on metals and plastics
Co mponent manufacturers could benefit from higher offtake More

A touch more than a stitch in time
A new spin
Duty structure rationalised
Lower input costs
Higher allocation to TUFS More

Wiring up the nation
Charging up
Section 80 (IA) benefit extended to 2010
Four ultra mega power projects to be awarded in 2006
Rural electrification targets increased
Backward integration into coal mining could increase competitiveness More

A few goodies for rural impetus, lower costs
Cost cuts
Input, packaging costs trimmed
Excise cuts to boost foods, ice creams
Rural impetus a big plus More

Ramp up in resources for welfare
The bulk of the resources must go to the UPA Government's eight flagship programmes: Sarva Siksha Abhiyan, Mid-day Meal Scheme, Rajiv Gandhi Drinking Water Mission, Total Sanitation Campaign, National Rural Health ... More

Tea industry hails allocation
The domestic tea industry received the much-needed stamp of approval from the Finance Ministry on the proposed Special Purpose Tea Fund (SPTF) for replantation and rejuvenation of tea bushes. Indian Tea Association (ITA) is, however, concerned ... More

Fiscal improvement
Plan expenditure for 2006-07 is estimated at Rs 1,72,728 crore, up 20.4 per cent. As a proportion of total expenditure, Plan expenditure has increased from 26.6 per cent in 2004-05 to 28.3 per cent in 2005-06 (RE) and further to 30.6 per cent in ... More

Let us make our destiny
Mr Speaker, Sir, I believe that the world has recognised the potential of India. It is now for us, the generation to which has been given the privilege of carrying the torch, to rediscover the greatness of this country and the potential of its ... More

Sighs of relief and dropped jaws — The FM seems content more at not ruffling many feathers
Tasks left incomplete
Tax evaders' citadels not touched.
Studied silence on exempt-exempt-tax.
Disappointment over standard deduction not staging a comeback. More

A shopper's day out
Small cars, ice-creams, colas cheaper; not so umbrellas, glassware
Consumers certainly have reason to cheer with this year's Union Budget. For they will now have to dish out less for small cars, ice-creams, colas, MP3 players, ready-to-eat food, footwear and textiles. At the same time, duty changes in the ... More

Taxes not recovered crossed Rs 1,11,000 cr
Hard fact
The biggest source of revenue foregone for the Government however remained customs duty. More

25 projects under e-gov plan
The Finance Minister, Mr P. Chidambaram on Tuesday said that the National e-Governance Plan would be approved shortly and 25 projects would be launched in mission mode during 2006-07. These include Project MCA-21 to enable companies to file ... More

Services sector provides Rs 23,000 cr
It is the booming services sector that has come to the Finance Ministry's rescue by arresting the trend of declining tax-GDP ratio in the post-reforms period. After falling from 10.12 per cent in 1990-91 to 8.95 in 2000-01, the ratio of the ... More

Refractories: Marginally positive
Casting a mixed blessing
Import duty on refractories unchanged at 10 per cent
Reduction of duties on raw materials from 10 to 7.5 per cent More

No major reaction
The upside
User industries of chemicals stand to gain
Mixed bag for PVC manufacturers More

Gathering pace
Order flows to continue
Infrastructure spending to increase order flows for capital goods
BHEL to benefit from ultra mega power projects
Reduction in Customs duty could reduce input costs More

Judicious tinkering
Balanced tinkering
Integrated producers unlikely to be affected
Drop in epichlorohydrin duties can affect TPL More

Equity fund redefined
A few other Budget proposals have specific implications on close-end and balanced funds. Close-end equity oriented funds have been given a level playing field with open-end funds on the provisions relating to dividend distribution tax, ... More

No special drive: auto parts sector
`There's further scope for reducing raw material duties to Asean levels'
While welcoming the broad thrust given to the manufacturing sector, the Auto Components Manufacturers Association (ACMA) felt that the Finance Minister had stopped short of making any specific announcement to promote the automotive sector. The ... More

Duty rationalisation for man-made textiles — More allocation for textile schemes; Rs 189 cr for textile parks
Spinners gain
So far, since the tax on raw materials was higher than the levy on the finished products, spinners had been facing difficulties in getting full credit on excise, while selling yarn to their customers. More

Excise duty cut, a boon for small carmakers — `Small cars' are Maruti 800, Wagon R, Zen, Alto, Hyundai Santro, Indica diesel
The beneficiaries
Cars that would fall under the proposed definition include the Maruti 800, Wagon R, Zen, Alto, Hyundai Santro and the diesel variant of Tata Indica.
Maruti's proposed Swift diesel, which will come with a 1.3 litre diesel engine later this year, is also likely to fall under this category. More

MFs keen to tap global opportunity
Mutual funds now have better access to global markets. The Union Finance Minister, Mr. P Chidambaram, has unshackled mutual fund investments in foreign equities from the restriction they previously had. The ceiling on investment by mutual ... More

IT industry divided over impact of excise duty — Desktop, notebooks may turn costlier
The Indian hardware industry today appeared sharply divided over the impact of 12 per cent excise duty on computers, with players such as Zenith, Acer and HP predicting about five per cent increase in prices of PCs and notebooks, even as HCL and ... More

Some habits don't die that easily
While the Finance Minister has only partially imposed service tax on the media, the waning centrality of his annual budget should spell concern for the growing army of journalists tracking the event. Over time, the nationwide monitoring of the ... More

AMFI to seek clarifications on foreign investments
The asset management industry intends to obtain the Government's clarification on whether the permission to cumulatively invest up to $1 billion in foreign ETFs (exchange-traded funds) would be in addition to the increased ceiling on investment ... More

Towards a cutting edge tax system
In the UPA Government's first Budget, and more so in the second, I had attempted significant tax reforms. The results are encouraging. In 2004-05, gross tax revenues (provisional actuals) increased by 19.9 per cent over the actuals of the ... More

Redeeming `Aam Aadmi'
Our success this year is due to our unrelenting emphasis on fiscal prudence through enhanced revenues and expenditure control, monetary stability and management of the external debt. However, our success should not tempt us to stray from this ... More

Boost for Bharat Nirman
Allocation for the flagship programme has been stepped up by about 55 per cent to give it a further thrust. More

Charting a high-growth path
Dr Manmohan Singh has raised the bar to 10 per cent; growth will be our mount; equity will be our companion; and social justice will be our destination. More

Calls everywhere, but search for energy
Lack of quality of infrastructure has been the recurring theme when the India story is discussed anywhere these days. The government is not short on initiatives. Can will be backed with implementation? More

Succour for the old
WILL HE GET IT? An old man at Commercial Street in Bangalore on Tuesday. The Union Finance Minister, P. Chidambaram, proposed an increase in old age pension to destitutes from Rs 75 to Rs 200 per month in his Budget speech on Tuesday. ... More

Pinches more than it soothes
With the economy doing well and the markets hitting new peaks every other day and Indians getting the largest pay hikes in the world, who is bothered about the Budget? After all, when the times are good and everyone is raking in whatever he (or ... More

Accent on digitisation — The income-tax offices will undergo business process re-engineering
The Finance Minister has set himself the difficult task of raising the tax-GDP ratio from 10.5 per cent to 11.2 per cent. Having realised that it is not by raising the tax rates but by enlarging the tax base that would help achieve this goal, ... More

How the tax breaks pan out
The Finance Minister, Mr P. Chidambaram, took only 30 minutes to spell out the tax proposals for fiscal 2006-07. Prima facie there does not seem to be any major relief for the individual taxpayer, but on going through the Finance ... More

Price cuts galore on small cars
Carmakers Maruti, Hyundai and Tata Motors have decided to pass on the excise concessions announced in the Union Budget on small cars to consumers. Following a reduction in excise duty on small cars from ... More

Excise duty: Minor twists
I propose to impose an 8 per cent excise duty on packaged software sold over the counter. Customised software and software packages downloaded from the Internet will be exempt from this levy. I propose to fully exempt from excise duty DVD ... More

Registrars, share transfer agents under service tax ambit — `12% levy is bad news for AMCs'
Registrars, share transfer agents and bankers to equity issues have now been brought under the service tax net. The Finance Bill 2006-07 proposes to levy service tax of 12 per cent on these services. While this is not expected to ... More

Tepid changes to corporate tax
In a regime where service tax has been expanded to cover various services, the list now nearing 100, the levy on hire purchase and leasing has been revisited, with the Budget specifically clarifying that the finance charges/interest portion ... More

Budget recedes in importance
This may not have been a `big bang' or a `dream' budget that sent the markets into yet another bout of bullish action. This is perhaps the first in a series of budgets over the next few years that will highlight the ... More

The knowledge society
Our outstanding human resources have the capacity to make India a knowledge society. The National Agricultural Innovation Project for research at the frontiers of agricultural science is expected to receive multilateral assistance shortly, and ... More

Investment boom
There is an investment boom in the country and it is necessary to maintain the confidence of investors. It appears that India is catching up with the high investment rates of East Asia and China. Honourable Members will notice presently that, in ... More

Let down on CST
It was widely expected that the promised reduction of the Central Sales Tax (CST) rate to 2 per cent would be announced in the Budget. In spite of the repeated assertions that continuance of CST is incompatible with VAT, the Finance Minister ... More

The wind is blowing, take cover!
After `Absence of Terrorism' comes `Benignity' in Thirukkural. "Except that they are on the face what for are eyes sans measured grace," asks couplet number 574 in this chapter. I'm sure TV viewers were eagerly looking for benign grace on ... More

Thin attendance, minimal interruptions — Top CEOs at industry chambers largely non-committal
That Budget presentations are gradually becoming passé was very much in evidence today when many members of the Lok Sabha failed to turn up for what a decade ago used to be the `big day' in the life of every citizen. Large gaps were seen among ... More

Corporates neutral to Budget proposals — It was on expected lines, say honchos
Thrust on growth
Barring a few minor benefits that accrued to sectors by way of minor tinkering with tariffs, the overall thrust of the Finance Bill tends towards broader economic growth. More

CUSTOMS DUTY
In line with the Government's policy of reducing customs duties, I propose to reduce the peak rate for non-agricultural products from 15 per cent to 12.5 per cent. I believe that we are now only a short distance away from East Asian rates. As the ... More

Offers in manufacturing, services
The two sectors which have the potential to create a large number of jobs are manufacturing and services. In manufacturing, we have identified some industries which, with appropriate incentives, can throw up huge job ... More

Boost for soya
The reduction in excise duty on Textured Vegetable Protein could expand profit margins for marketers of branded soya chunks such as Ruchi Soya and Marico Industries. The product is already seen as a meat protein ... More

MAT rates altered
Corporate India may soon face minimum alternate tax (MAT) blues, with the Finance Minister, Mr P Chidambaram proposing to include long-term capital gains arising out of securities in the calculation of ... More

Captains tuned in
ALL EARS: Mr Y. C. Deveshwar, President, CII, Mr R. Seshasayee, Vice-President, CII, and Mr Rahul Bajaj, Chairman, Bajaj Auto Ltd, listen to the Budget speech in New Delhi on Tuesday. ... More

`Fiscal deficit to come down'
Mr Nimesh Kampani, Chairman, JM Morgan Stanley: Over the years the Finance Minister (FM) is working towards making the Budget a non-event and that is a sign that the economy is rapidly moving from developing to a developed one. Also the ... More

`Good Budget for industry'
Mr Keki M. Mistry, Managing Director, HDFC Ltd: To the industry in general, it is a good Budget. The framework of the last two years continues. The reforms continue, the direction of reforms continues. And continuity is something very ... More

Stable tax structure welcomed

It'll promote export growth

Focus on rural sector

It gets 8 marks out of 10

Petroleum industry unhappy

Boost for auto sector

CHEMICALS

Duty cuts for plastics, hydrocarbons
The Budget for 2006-07 presented in Parliament on Tuesday has some good news for the chemicals industry. The Finance Minister, Mr P. Chidambaram, has proposed to reduce the customs duty on basic and organic chemicals from 15 per cent to 10 per ... More

CONSUMER ELECTRONICS

Zero customs duty on set-top boxes to benefit manufacturers
The Finance Minister, Mr P. Chidambaram today removed customs duty on imported set-top boxes (STBs) while levying 16 per cent excise duty on the same. According to the broadcasting industry, this would benefit direct-to-home operators. Mr ... More

EXCISE AND CUSTOMS

Customs duty hike — Vanaspati industry disappointed
Imported oils could now become dearer by Rs 1,000-1,200 a tonne More

INFRASTRUCTURE

Wiring up India with highway networks
The National Highways Development Programme (NHDP) continues to make impressive progress. The highest ever number and value of contracts were awarded in calendar 2005. I propose to enhance the Budget support for NHDP from Rs 9,320 crore to Rs ... More

On the expressway
Increased allocation
Irrigation players to benefit
Sufficient equity to become key to bid
Extended tax incentives to give comfort More

Higher allotment for highways
The Government on Tuesday proposed to enhance the budget support for the National Highways Development Programme (NHDP) to Rs 9,945 crore in 2006-07 from Rs 9,320 crore in 2005-06. It also proposes to open a separate window under rural roads ... More

PETROLEUM

No relief for oil cos on pricing, duty structure
Oil slick
Cess under the Oil Industry Development Act to be hiked.
States cannot charge more than 4 per cent VAT/sales tax for LPG. More

PHARMACEUTICALS

Pharma sector sulks as Budget ignores wish-list
Dosas and condensed milk will cost less, but not your medicine, quips Wockhardt's Chairman, Mr Habil Khorakiwala, voicing the collective disappointment of the pharmaceutical industry, which has been all but ignored by Budget 2006. There ... More

A no-show for the pharma sector
The pharma sector has been largely unaffected by the Budget. The extension of fiscal incentives on Research & Development was widely anticipated. There is, however, adequate time for the Government to give effect to ... More

`Not much for pharma sector'
When we come to specifics of the pharma industry, we find there is very little in it for us. Reduction in peak custom duties from 15 per cent to 12.5 per cent will bring down imported raw material costs, which is a positive sign for all! The ... More

Bleak outlook for pharma sector

POWER

More coal blocks for power sector
Powering growth
Electricity to 40,000 villages to be provided in 2006-07.
The total outlay for the Rajiv Gandhi Grameen Vidyutikaran Yojna has been fixed at Rs 3,000 crore in 2006-07.
Excise duty on compact fluore scent lamps cut from 16 per cent to 8 per cent. More

SHIPPING

Budget disappoints shipping industry
Contrary to the expectations of the industry, the Finance Minister has brought ship management services in the service tax net. To make matters worse, a host of services have been brought within the ambit of ship management services. More

Shipping management services expensive
Shipping operations costs are set to increase with the Union Budget proposing to levy a 12 per cent service tax on shipping management services. Customers would also be required to pay higher for their cruises as travelling on cruise ships may ... More

STEEL

Marginal duty cut for alloys, metals — Proposal to cut duty on mineral products to 5 per cent
Budget 2006-07 has announced 2.5 per cent reduction in customs duty on alloy steel and primary and secondary non-ferrous metals, from 10 per cent to 7.5 per cent. The import duty for other ferro-alloys has also been brought down from 10 per ... More

SUGAR

Sugar sector feels let down — `No measures on de-control'
Sugar industry felt a bit let down by the Union Budget placed on Tuesday because the Finance Minister, Mr P. Chidambaram, did not take step towards decontrolling the sector. Mr C.S. Nopany, President of Indian Sugar Mills Association (ISMA), ... More

TAXATION

15 new services under tax net — Scope expanded in banking, financial services
The Finance Minister, Mr P. Chidambaram has brought 15 new services under the tax net, while extending the scope of the levy on 12 existing services and withdrawing exemptions on six others. The 15 new services made taxable include services ... More

If only consumers had lobbyists
Pressure groups and lobbyists are available for business houses. But the poor consumer has none taking up cudgels for him. The service tax rate is sought to be raised to 12.24 per cent from the existing 10.2 per cent. The service providers ... More

TEA

Hails nod for tea protection fund
Mr Deepak Khaitan, Vice-Chairman of Mcleod Russel India has welcomed the Union Finance Minister's formal approval of the special tea protection fund adding he has assured allocation of Rs 100 crore for ... More

Wah! Budget
The tea industry, which has been beleaguered by low prices, has been offered a ray of hope. Although the package for re-plantation and rejuvenation of tea was announced in the previous Budget, it did not take off. The ... More

`A boost to replantation'
The decision to invest Rs 100 crore by Union Government would boost replantation activity. Reduction of customs duty on packaging items from 15 per cent to 5 per cent would help us to innovate and create new avenues for ... More

TEXTILES

`Will help exports'
Lowering of excise and customs duty on man-made fibre/filament yarns proposed in the budget will bring down the raw material cost for the textile industry and enhance the scope for higher synthetic textiles exports from the country, feels Mr ... More

COAL

Policy overhaul for coal sector
The Budget for 2006-07 presented on Tuesday indicated substantial policy changes for coal mining over the next few years. The Finance Minister, Mr P. Chidambaram, has said that a comprehensive review ... More

BREWERIES

`No relief for domestic liquor players'
The liquor industry has said that the Union Budget has not directly addressed any of the issues relating to the sector. The UB Group President and Chief Financial Officer, Mr Ravi Nedungadi, told Business Line that even though ... More

CIGARETTES

A mild choker
The cigarettes industry could be in for a mild surprise on the down side. The Finance Minister has side stepped the general pattern witnessed in earlier Budgets, which featured excise duty hike of 10 per cent every ... More

Additional excise irks cigarette cos
The Budget has imposed an additional five per cent excise duty on cigarettes. Reacting to the move, cigarette manufacturers have raised the flag calling the move a "discriminatory" one. "It's quite ... More

Tobacco shrugs off excise hike
The tobacco industry, dominated by the three cigarette manufacturers — ITC, GPI and VST, seems to be more or less resigned to a yearly hike in excise duty via the Union Budget, and a five per cent increase in duty this time does not have ... More

PERSONAL PRODUCTS

FMCG prices to stay put
Consumers can heave a sigh of relief. While they may not be forking out less for their soaps, toothpastes and detergents, the flip side is that makers of fast moving consumer goods of daily consumption are unlikely to hike prices. As Mr Satish ... More

RADIO/TV

No reason to blush
The impact of service tax is likely to be marginal on Balaji Telefilms, as it derives close to 90 per cent of revenues from commissioned programmes. In this arrangement, the broadcaster undertakes to market and also ... More

CARS

Your small car will now be less expensive
I reiterate that it is our intention to converge all rates at the CENVAT rate, which is now at 16 per cent. There are only two items - aerated drinks and cars - that still attract the higher rate of 24 per cent. I propose to correct this ... More

Toyota not to hasten small car launch
Toyota-Kirloskar Motor (TKM) has said the reduction in excise duty on small cars will not hasten the process of the company to launch its small car. "We consider a variety of reasons including the ... More

AUTOMOBILE COMPONENTS

Positive spin to auto ancillary
The reduction in excise duty on small cars effected in the 2006 Budget could impart positive market sentiment towards auto-ancillary units, especially the ones having exposure to small cars producers such as Maruti, ... More

ELECTRICAL GOODS

A ray of hope
The reduction of excise duty on Compact Fluorescent Lamps (CFLs) from 16 per cent to 8 per cent could have a positive impact for Havells India, Crompton Greaves, Bajaj Electricals and Surya Roshni. Havells India, a ... More

BEVERAGES

Will colas be cheaper?
Would the reduction of excise duties on aerated drinks from 24 per cent to 16 per cent mean cheaper Pepsi and Coke for the cola drinkers this summer? Industry observers say that if prices were to be cut, the difference would be 20 paise per ... More

FOODS & FOOD PROCESSING

Priority in lending to food sector — Rs 1,000-cr corpus for refinancing loans
In an attempt to provide an impetus to the food processing industry, the Finance Minister, Mr P. Chidambaram, today announced that food processing would be treated as a priority sector for bank credit. Mr Chidambaram said the National ... More

Priority sector status hailed
The food processing sector is getting sufficient importance at the Central level and can change the face of the rural India, if given a right direction, according to Mr Pradeep Chordia, Managing ... More

`Greater credit flow likely'
This is the first-ever Union Budget that has focused attention on food processing and food technology. For some time now the food processing sector has required a renewed measure and formalised approach, which the ... More

CULINARY CORNER
Of pasta, idli and dosa
One did not know that a culinary wave of pasta-consumption had swept through India until Budget 2006 recognised it, with the Finance Minister, Mr P. Chidambaram, completely exempting pasta (along with condensed milk and yeast and other items) ... More

GEMS & JEWELLERY

`Expert panel to help gems sector'
The Budget proposal for setting up an expert committee to consider the recommendations by the gems and jewellery sector will help India transform into an international gem and jewellery trading hub. Commenting on the announcement ... More

HARDWARE

`Viability gap funding' for semiconductor projects — New policy on cards to make India hub
Provides incentives required for the industry to establish its roots and make domestic manufacturing of semiconductors and electronics a viable opportunity. More

SOFTWARE

`8% excise on packaged software not good'
Infosys Technologies Ltd's board member and Chief Financial Officer, Mr T.V. Mohandas Pai, has termed the Union Budget as that of consolidation and growth, but felt that the Finance Minister could have done more in terms of reducing the excise ... More

`Hike in service tax a dampener'
The Chairman of Satyam Computer Services, Mr B. Ramalinga Raju, has said that the Budget has largely been neutral for the IT services sector though the stress on infrastructure and education should be positive for the ... More

LEATHER

A good fit for consumer
Shoe manufacturers Bata and Liberty will benefit from the reduction in excise duty on shoes in the price range of Rs 250-750. The measure has, however, been accompanied by a reduction in the abatement from retail sale ... More

METALS

5 pc hike likely in landed cost
The landed cost of major non-ferrous metals including copper, nickel, zinc and lead metal is likely to increase by about 5 per cent, despite the 2.5 per cent basic customs duty cut proposed in the Union Budget 2006-07. The Finance Minister, Mr ... More

PAPER, BOARD & NEWSPRINT

A fine cut for paper
The paper industry has had an excise break that not many would have anticipated. This is, however, not likely to have any beneficial impact on their profitability. Nor is this move likely to boost volumes, as demand ... More

Paper sector happy with excise cut
The paper industry welcomes the rationalisation of excise duty. Earlier, 65 per cent of the paper products were subject to 12 per cent excise duty and now the remaining 35 per cent have been brought under the same bracket, which ... More

`Impetus for growth'
The excise duty reduction on printing and writing paper is a welcome move for the paper manufacturers. According to Mr R. Gopalaratnam, Chairman and Managing Director, Seshasayee Paper & Boards Ltd, the reduction in ... More

Constraint on raw material sourcing
The paper industry has felt that the Government should make efforts to remove the main constraint of raw material sourcing. Reacting to the Budget, Mr R.C. Mall, Executive Director of Andhra Pradesh Paper Mills Ltd, said ... More

Excise duty cut for paper products
The Finance Minister, Mr P. Chidambaram, has proposed a cut in the excise duty for paper products from 16 per cent to 12 per cent. Mr Chidambaram, in his speech said: "Paper finds widespread use in education as well as in ... More

BIO-TECH & GENETICS

`Likely to see flight of IP to tax-friendly nations'
The silence on extending a key demand of the pharma-biotechnology sector - the 150 per cent weighted average tax deduction on research spend - beyond March 2007 can diminish indigenous research investments; it would dry up an already low ... More

DAIRY & DAIRY PRODUCTS

Ice-creams cheaper? Maybe not all
If you thought ice-creams would be cheaper this summer, you may be mistaken. Though the Finance Minister, Mr P. Chidambaram, announced an excise duty exemption on ice-creams, condensed milk and pasta, this may not translate into ... More

JUTE

Jute industry upset
The jute industry is not at pleased with the Union Finance Minister, Mr P. Chidambaram's Budget announcements on the sector. According to the industry leaders, these are nothing new because the proposal to create a National Jute Board was ... More

DISINVESTMENT

Govt may dilute stake in non-navratnas
The Government is expected to get Rs 3,840 crore after disinvesting small stakes in non-navratna companies in 2006-07. While last year's budgetary estimates did not indicate any revenue receipts from sale of equity in public sector companies, ... More

RURAL DEVELOPMENT

Going the extra mile for the farmer
Projects that could make a difference to Rural India have been placed in the limelight. The government has been liberal in scaling up fund allocation and hopes this will improve the well being of the farmer. More

SUPPLY CHAIN MANAGEMENT

Service tax, no hiccups for Concor
Moving goods across the country by containers will now be more expensive, given the 12 per cent service tax. Container Corporation of India will feel the immediate impact. It is, however, likely to pass on the hikes to ... More

INTERVIEW

Service tax hike not to have inflationary impact
The Finance Minister, Mr P. Chidambaram, plans to include a clause in the proposed insurance bill to hike FDI cap from 26 to 49 per cent. He is also confident of introducing the pension reforms bill during the current session of Parliament. In ... More

INCOME TAX

Bank deposits to get 80C deduction — Recapitalisation bonds to be converted into tradable securities
Deposit mobilisation by banks will get an impetus with the Finance Minister, Mr P. Chidambaram, allowing investment made in term deposits of scheduled commercial banks with maturity of not less than five years to be eligible for deduction under ... More

No bad news on income taxes
The direct tax proposals have almost been a `non-event'. The Finance Minister has confined his measures to a few tweaks here and there. More

Tweaking the FBT
Fringe benefit tax (FBT) was introduced as a revenue raising measure. FBT can be justified on the principles of horizontal equity and vertical equity. Nevertheless, I have reviewed it with an open mind. I have also taken on board the views ... More

Fringe Benefit Tax provisions modified — India Inc not mollified, wants it to go completely
Watered down
Exemption of Rs 1 lakh for contributions to superannuation fund
Medical samples, equipment, celebrity endorsements, free transport excluded
Benefits under `tour and travel', hospitality to attract 5 per cent More

TOURISM

Outlay for tourism hiked
In an effort to give a boost to the country's efforts to attract more tourists, the Finance Minister, Mr P. Chidambaram, today announced an increase in the Plan allocation at Rs 830 crore during 2006-07 ... More

CARTOON