Polymer industry to gain from strategic crude oil reserves: Ajay Durrani

Budget's proposal to reduce basic customs duty on LNG to provide respite to petrochemicals sector

Last Updated : Feb 02 2017 | 1:07 PM IST

The Union budget announced today is a balanced budget focusing on providing an impetus to the economy and offers encouraging measures for the tax payers. As expected GST, demonetisation have ushered in tectonic changes for economy and the same was conspicuous in the budget.

There are multiple take-aways from the budget that is aimed at boosting consumption, skill development and highlights concerted efforts in the direction of creating improved living standards in the country.

The reduction in the tax rate in the income tax slab of Rs 2.5 lakh to Rs 5 lakh to 5 percent from 10 percent will give rise to disposable income of individuals and boost consumption. Similarly, the subventions offered for the MSME sector in the form of tax rebate, reduction in income tax for SMEs with annual turnover up to Rs 50 crore, as well as, the extension of the profit linked deduction period available to the start-ups to three years out of seven years will provide a stimulus to employment generation.

Agriculture, which is a key contributor to the country’s GDP, has received multiple sops; which is heartening. The decision to increase credit to farmers, with 60 days interest waiver, increase in NABARD fund, science-driven farming is being promoted with soil cards, micro-irrigation funds and mini labs in Krishi Vigyan Kendra will provide an impetus to the food productivity of the country. Also, the decision to install bio-toilets in railways is also a step in the right direction.

The polymer industry will receive a boost from the proposed additional strategic crude oil reserves. Similarly, the proposed reduction in the basic customs duty on LNG from 5 percent to 2.5 percent will provide a respite to the petrochemicals sector.

The thrust on the ‘Housing for All’ scheme continues with the budget. The decision to give it an infrastructure status as well as interest subvention for housing loans and reduced lending rates by banks post-demonetisation is a welcome move.

The target of providing 1 crore houses for the houseless with a budget of Rs 27,000 crore, spells good news for the sector. However, if the FM would have linked its affordable housing scheme with the agenda of making India an energy efficient nation, it would have served the greater good of scripting a brighter, better future of the nation.
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Ajay Durrani is the country president (India) and managing director of Covestro India Pvt Ltd