Mixed reactions to budget proposals by TATAs, SAIL and EEPC

Kolkata, Feb 28 (UNI) SAIL Chairman S K Rungta and Tata Steel Managing Director B Muthuraman said today's Union Budget was directed towards ensuring long-term growth of Indian economy.

Reacting to 2007-08 Union budget, Mr Muthuraman said the budget was ''more focussed to bring the under-performing sectors to perform without jeopardising the growth trajectory of the overall economy''.

However, the increase in dividend distribution tax and cess on education were likely to increase the tax burden on corporates, he felt.

Referring to the increased investment in agriculture, education and health, the Tata Steel MD said infrastructure would contribute to sustain the growth in the long term, while the increase investment in health and education was going to bring about inclusive growth.

The focus on infrastructure would support increase in the demand for manufactured goods as well as to make the manufactured goods cost competitive in the long run, he added.

Describing the introduction of export duty on iron ore and chrome ore as a ''welcome move and directed towards conserving the scare resources for the long term benefit of the country,'' Mr Muthuraman said the budget did not assure large investments in the private sector.

Steel Authority of India Ltd (SAIL) Chairman Dr Rungta in his response to the budget, said higher outlays for Bharat Nirman, irrigation projects, power, drinking water and roads besides infrastructure related mutual funds, was a ''step in the right direction.'' He said the Union Finance Minister had rightly recognised the need to conserve mineral wealth, especially iron ore, for value addition within the country and as such levy of export duty on iron ore was 'timely'.

''We are happy that the much-awaited phasing out of Central Sales Taxes (CST) would ultimately lead to implementation of common goods and service tax by 2010.This should be welcomed by the entire industry," he said.

Engineering Export Promotion Council (EEPC), the apex body of Indian engineering exporters, termed the budget proposals as ''a mixed bag.'' Giving his reactions, EEPC Chairman Rakesh Shah felt that the budget despite having strong focus on agriculure, rural development and rural infrastructure growth, lacked enough policy measures that could push the GDP rate to ten per cent in the Eleventh Plan period, beginning this year.

''One of the most significant initiatives announced by the Finance Minister concerns the attention given to critical infrastructure development of the country'', he said adding, the steps initiated towards the development of nine Mega Power Projects, development of coal fields and national highways, apart from the success of the PPP and viability gap funding approach for infrastructure development were indeed the most appropriate,'' Mr Shah said.

UNI