Industry expresses mixed views on Karnataka budget

Lower revenue estimates for FY14 is a matter of concern

The captains of industry and trade bodies in Karnataka have expressed mixed feelings towards the state budget for 2014-15 of chief minister Siddaramaiah. According to them, the budget lacks focus and there is no thrust on promotion of industrial development and there is no punch required for entrepreneurial growth and increase investments.

While welcoming the state government's intention to focus on inclusive and all-round development, H V Harish, President, Bangalore Chamber of Industry and Commerce (BCIC), has expressed disappointment that there has been no specific thrust to promote industrial development in the state.

S Venkataramani, Co-Chairman of Indirect and State Taxes Committee, BCIC, welcomed the proposal to reduce stamp duty to a uniform rate of 2 per cent for all joint development agreements.

However, he expressed concern on the revised revenue estimates of the state which has been lowered approximately to Rs 8,500 crore compared to the Budget Estimates. "This means the revenue mobilisation efforts of the state have not met the Budget Estimates and the borrowals will continue to be higher," he said.

R Shivakumar, President, Federation of Karnataka Chambers of Commerce and Industry (FKCCI), said the budget has also overlooked the urgent need for a shot in the arm for the manufacturing sector which provides employment to thousands of skilled personnel.

"Bangalore contributes 50 per cent of the revenue to the State economy. There is no mention about providing water, curbing garbage mounds as it has affected the reputation of this prime city. The budget fails to meet the challenges of Bangalore needs," he said.

However, the FKCCI appreciated a move on providing support of venture capital in setting up 1,000 micro enterprises, interest subsidy to industrial town sheds and amendment to minor mineral rules including sand and proposed to establish gems and jewellery (SEZ) helping waivers with special package and amount funding for implementation of new readymade garment policy.

The budget is people-centric where the chief minister has spared the common man of additional tax burden. The budget focuses on inclusive growth with special emphasis on education, healthcare, agriculture and social welfare. The budget also offers a fillip to infrastructure development in Bangalore and several areas of Karnataka, said Confederation of Indian Industry (CII).

"We welcome the budget, it is understandable as to why the Chief Minister has chosen to leave VAT rates largely unchanged. There are several positives in the budget for the people of Karnataka. Vocational Training for students is a step in the right direction as skilled labour is the need of the hour. CII would like to see this initiative adopted in a much wider scope," said Soumitra Bhattacharya, Chairman, CII Karnataka.

Assocham has cautiously welcomed the Budget proposals for the year 2014-15.

J Crasta, Co-Chairman, Assocham Southern Regional Council welcomed the budget proposal to develop 2 new industrial townships in the State.

He also welcomed enhanced allocation to education sector, which he said would help strengthen education system in the State. He said that in order to make best of India's demographic dividend, it was important that education levels across all sections of society were improved.