US Industry lauds India's Budget 2007-08

Washington, Mar 1: The US-India Business Council (USIBC) has welcomed India's 2007-08 Budget for its ''inclusive-growth message'' marked by reduction in customs duty on certain items.

''The US-India Business Council is pleased with the initiatives listed in the 2007-08 Union Budget. It should achieve a balance in promoting infrastructure growth while combating inflation, and provide new opportunities for American companies to engage in the Indian market,'' said USIBC President Ron Somers.

The USIBC also hailed other initiatives outlined by the Finance Minister P Chidambaram, particularly a reiteration of his pledge to introduce an amendment to the Insurance Act that will provide greater scope for foreign investment in the sector, escalating the Advanced Power Development and Reforms Project, as well as new thrusts on reforming education, agriculture, infrastructure and financial services.

The USIBC, however, noted that the FM did not raise a few critical issues it hoped would be addressed in the 2007-08 Budget.

Chief among these are taxation issues related to transfer pricing for IT service operations, and an extension of the Software Technology Parks of India tax incentive.

The US industry is particularly pleased by further reduction in peak customs duty rates from 12.5 per cent down to 10 per cent, and further reductions in customs duties on chemicals, plastics and other materials to 7.5 per cent.

A reduction in customs duties on medical equipment to 7.5 per cent, an increase in defence expenditures, and the extension of ''pass-through'' status for venture capital funds invested into a number of growth industries has come as a welcome change, it said in a statement.

The USIBC will launch a 38-company executive mission to India to attend a Confederation of Indian Industry economic summit on March 6 in New Delhi.

This USIBC mission is scheduled to travel to Kolkata and Chennai on March 8 and 9.

UNI