Punjab and Haryana to benefit from Union Budget

The states of Punjab and Haryana are expected to gain from the thrust given by the Union Budget on the rural and agriculture sectors by the union finance Minister Pranab Mukherjee.

Talking to Business Standard Chairman, Economic Affairs & Taxation Sub- Committee, CII Northern Region & COO of a professional services firm KPMG, Richard Rekhy said that revised allocation to agriculture and agri-processing industry in form of concessions on setting up of cold chains, cold storage and handling facilities, exemption on customs duty on agricultural machines not manufactured in India, service tax exemption on transportation of cereals would help in strengthening the post-harvest infrastructure.

The extension of farm loan waiver by another six months, the increase in interest rate subvention from 1 per cent to 2 per cent for the farmers who repay in time would help farmers abstain from moneylenders.

He added that all these measures would generate the demand for corporate sector as the increased farm incomes would drive the demand for consumer goods.

Talking about the revision in excise duty from 8 per cent to 10 per cent across the board and its likely impact on inflation, Executive Director – Indirect Taxes, KPMG Pratik Jain said it was only a partial rollback of the stimulus given to the industry in the wake of the economic slowdown. The excise duty was slashed from 14 per cent to 8 per cent last year to maintain the momentum of industrial growth and the rollback was inevitable.

There was a slight disappointment for the textile cluster of Punjab as it was a big employer and has been sluggish due to lack of technological upgradation and sudden revision of cotton price in the last two years.