No impact on revenue, says FM

Finance Minister Jaswant Singh said the tax cuts announced yesterday would not have any major impact on revenue and the government was expecting faster growth in the third quarter of the current fiscal.

"Every tax measure has certain implications. The impact on revenue will be temporary. These measures will, in fact, greatly enhance growth and stimulate investment," he said.

Singh added that the measures were not announced with an eye on the impending elections, but were part of a continuous exercise and would not have any impact on the budgetary process.

"These steps have not been taken in a fit of amnesia. The budgetary process has not been hurt. The revenue outlook is very positive," the minister said, before leaving for a meeting of the National Democratic Alliance.

He said any delay in these economic initiatives would have delayed growth prospects. "The decisions announced today will further enhance growth," he added.

Singh said the economic scenario in India was such that fiscal initiatives could not be restricted to an annual Budget.

"The Budget process should not be viewed in form of a mela, to be held for one day and after that we spread the cot and go to sleep," he said.

The initiatives announced today had been taken after a lot of calculation and after estimating their budgetary implications, he said.

He added that they were part of the overall Budget management process.

The minister recalled that in last year's Budget, the government had given a commitment to further cut in Customs duties. He said the latest steps were in line with that promise and were aimed at increasing both investment and production.

"There are sectors like health and information technology which are growing, so why delay giving them incentives," the finance minister said.

The economy is on a roll and changes in the duty structure would give it further impetus and stimulate investment, growth and confidence in India, he said.