Trade bodies eye power duty cuts

BUDGET WISHLIST

As the state government unveils the budget for the financial year 2006-2007 on Friday, majority of the trade associations from the region are anticipating relief in two prime areas, electricity duty and package for developing basic infrastructure.

"The state charges the highest duty on electricity in the country. This being a recurring expense, should be abolished totally as the revenue generated from it is not significant," said Dhansukh Vora, secretary of Greater Rajkot Chamber of Commerce and Industries (GRCCI).

"Imposition of duties are not allowing us to compete globally and products made in Gujarat cannot become global brands. Again, we are facing tough competition from products offered by southeast Asian players, especially China, who do not suffer such disadvantages," Vora added.

As far as special package for developing basic infrastructure is concerned, Vora clearly expects state government to pay special attention on developing coastal infrastructure and expects the budget to come up with some measures.

"We have a vast coastline of 1,600 km. Some development has taken place due to private participation of players for developing ports and allied facilities. Yet the state government has failed to focus on improving connectivity via road, rail and air to these destinations, for facilitating logistics support to industries coming up in the coastal region," said Vora.

He added that the state has taken no initiative to develop coastal maritime transportation system either for goods or for mass commuting. He expects some special schemes to be announced for the development of coastal region.

However, Mahesh Shah, president of Federation of Small Scale Industry (FSSI), Vadodara, said "We expect the government not to hike duties on electrical power for the benefit of small scale industries (SSIs)."

He emphasised that the small scale industries in the state should be given a level-playing field in order to compete with counterparts in states such as Karnataka and Maharashtra, as those states provide cheaper power to SSI.

Further, he wants SSI not to be penalised for subsidising the agricultural sector. According to him, the government should start taxing big farmers.

While in the case of infrastructure, Manoj Selot, president of Vaghodia Industries Association, said, "The infrastructure sector has to be given priority as it is the driving force of industrial growth."

He further added that the collected tax should be used wisely for infrastructure growth and surpluses should be diverted towards infrastructure projects in the upcoming state budget.

"The state budget must reduce power rates otherwise it will hurt industries in the state in a major way," said Yogendra Gangwal, president of Federation of Gujarat Industries (FGI), Vadodara.

Moreover, with BJP-ruled Madhya Pradesh opting for value-added tax (VAT), it will certainly come to Gujarat, said Gangwal.

He also sought cheaper power for the state.