Competition for insurers: R N Bhardwaj

UNION BUDGET 2005-06: COMMENTS

The overall Budget is very actually good as it is growth and investment oriented, with special thrust on agriculture, textile, and infrastructure.

The government's fiscal deficit slated to be at 4.3 per cent is also seen to be good. The finance minister has made an attempt to rationalise the tax structure and has even tried to redefine the banking sector in terms SLR, CRR, which will give more liquidity in the system.

With removal of section 88 and section 80 CCC, the life insurance industry will need to compete with other investment avenues. What is today not clear is whether section 10 (10) D continues, as this has yet to be decided by an expert committee.

However, the finance minister said that we need to move towards EET (exempt investment, exemption interest on investment and tax returns). We will see improvement in the textile, cement and infrastructure industries.