Karnataka chambers dub budget a political manifesto

The Federation of Karnataka Chambers of Commerce and Industry Monday termed the interim budget for 2014-15 a "political manifesto" than a policy on fiscal probity, investment and growth.

"The interim budget proposals are debatable in the backdrop of macro-economic risks. It is more a political manifesto than a policy on fiscal probity, investment and growth," chamber president R. Shivakumar said in a statement here.

Noting that Finance Minister P. Chidambaram made use of the occasion to give a comparative statement on the United Progressive Alliance government's first and second terms, Shivakumar said the budget had no reforms to stimulate the economy as it was a a vote on account.

"Though taxation policies are not touched in an interim budget, Chidambaram surprised everyone by reducing excise rates till June 30 to boost the manufacturing sector," he said.

Besides lowering excise duty on cars and motorcycles, the interim budget reduced excise duty on capital goods and non-consumer durables to stimulate growth.

The chambers, however, commended the finance minister for pegging the current account deficit to $45 billion and curbed the fiscal deficit to 4.6 percent for the 2013-14 fiscal.

"It appears to be a populist budget and measures proposed would have been appreciated if these were introduced two years earlier," Shivakumar said.

On the thrust given to infrastructure by developing three more industrial corridors on the Bangalore-Chennai, Bangalore-Mumbai and Amritsar-Kolkata routes, Bangalore Chamber of Industry and Commerce (BCIC) president H.V. Harish said the corriodors augured well for the country to generate thousands of jobs and growth.

BCIC vice president A.N. Chandramouli, however, expressed disappointment over the delay in introducing the Goods and Services Tax (GST) and the Direct Tax Code (DTC) as they were critical reforms for the industry.

"We hope the new government will introduce these tax reforms to give boost the Gross Domestic Product (GDP) by two percent regardless of the political situation," Chandramouli added.