Budget should focus on fiscal firm up

Govt must refrain from any surprises like retro on tax front

The government might be busy advancing the date of Budget, but economists and businessmen have some words of wisdom to give to North Block on its priorities.

At the India Economic Summit, Harvard professor of economics Gita Gopinath said the Budget should focus on fiscal discipline and not surprise with taxes such as the one that came through a retrospective amendment to the Income-Tax Act.
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“A good Budget is one which signals fiscal discipline, transparency and continuity,” she said.

Pawan Munjal, chairman of Hero MotoCorp, said he’d like to see a road map for five to 10 years in terms of Budget priorities.

CII president Naushad Forbes said the country was in transition to low inflation and lower interest rates.

Vineet Nayyar, vice-chairman, Tech Mahindra, said interest rates were too high for capital formation. “At 10-11 per cent rates, where is capital formation going to come from?” he wondered.

Sri Lankan Trade Minister Malik Samarawickrama advocated a need for India and Pakistan to find a way of working together, if the South Asia regional grouping, Saarc, was to go forward.

Noting intra-region trade was only five per cent of the total trade of Saarc members, he pointed to the high cost of trading in the region and absence of a regional value chain.

“It shows we are nowhere near where we want to be,” the minister said, at the India Economic Summit here.