Industry gives mixed response to UP Budget

Industry and industry associations in Uttar Pradesh have responded to the State Budget with mixed reactions. The budget was presented by Finance Minister Lalji Verma in the House yesterday.

Keeping industrial infrastructure on a priority by government is considered as a welcome step. On the other hand, industry welcomes the target of the state government to generate opportunities for 39,600 persons by setting up 2,200 units under the Rural Industry Employment Generation Scheme.

Responding to the State Budget, Deepak Malik, chairman, Confederation of Indian Industry (CII), Uttar Pradesh State Council, said, "The CII welcomes the Budget. It has laid renewed emphasis on improving the fiscal situation of the state through additional resource mobilisation, better and efficient management of state taxes and controlling unproductive expenditure."

According to the CII, the Budget is based on the principle to introduce a pragmatic and realistic economic policy in the state to meet the challenge of including every section of society in mainstream development.

On the other hand, Mukesh Tandon, general secretary, Indian Industries Association (IIA) welcomed the initiative of the government to operationalise projects in the public-private partnership (PPP) mode. He said this will speed up the completion time of the projects, while the government exchequer will not be burdened.

An expenditure of Rs 40,000 crore will be made on the eight-lane Ganga expressway project to be constructed under PPP. It will also generate new opportunities in the state especially in central and eastern UP. Four other important link expressways (from Ghaziabad to Saharanpur-Mohaand, Jhansi to Kanpur-Lucknow-Gorakhpur-Kushinagar, Agra to Kanpur and from Bijnore to Moradabad-Fatehgarh) have been announced, again on PPP basis. The CII has welcomed the move.

However, it was felt the Budget did not offer any lucrative benefits to the small and medium enterprises (SMEs). "Small and medium enterprises are the backbone of the social, economic and industrial development in the state. This sector is providing maximum employment, next to agriculture.

The Budget could not find any thing for this vital sector of our economy," said Ganesh Chaturvedi, former president, IIA.

Industry chambers welcomed the implementation of value-added tax (VAT) in the state. Tax rate on agricultural inputs like water pump, tractor, harvester, thrasher, chemical fertilisers and pesticides have been fixed at 4 per cent. Similarly, tax rate of 4 per cent has been fixed on all milk products, medicines, cycles and match boxes.