There has not been any big imposts or levies that could be called burdensome or pain on any one specific segment.
Contrary to general apprehensions of possible cuts in outlay and several likely proposals for mobilising resources, Union Budget 2013 has a higher outlay by 29.4 per cent for Plan expenditure and adequate outlay for all the welfare / developmental schemes. There are also several positive moves to stimulate savings and investment. There has not been any big imposts or levies that could be called burdensome or pain on any one specific segment.
However, on certain key growth-stimulating aspects for the agri-business industry, the Budget has been disappointing.
The increase of the crop loans kitty, the rural farm credit increase to Rs.7 lakh crore and expanding the incentive to farmers for repaying loans to private sector banks also on time, will provide some relief to the farmers. However, the farming sector was reeling under severe problems such as monsoon failures and shortage of farm labour. In this scenario, we were expecting key initiatives to help address the soil nutrition and water and power availability issues. The Budget has not addressed this sector holistically. The increased allocation to MNREGA will increase the burden on the farmer, because it would impact the availability of labour for farming activity.
From the fertiliser industry perspective, given that fiscal deficit target committed by the Finance Minister is at 4.8 per cent of gross domestic product (GDP) for 2013-14, it can be reasonably expected that much needed reforms in the urea segment of fertilisers will be carried through. It would be desirable to introduce nutrient-based subsidy for urea also to encourage balanced use of fertilisers.
From the sugar industry perspective, the request for removing levy obligations, imposing flexible duty on sugar imports and ethanol blending have not been addressed, stifling the growth of the industry.
A. Vellayan is Executive Chairman, Murugappa Group