Mr. Rajat Jain, Managing Director, Xerox India Limited.
The maiden budget presented by the new government has been high on intent and has laid out initial steps to kick-start growth, tame inflation, fiscal consolidation, attract foreign capital as well as push through economic reforms. A composite cap of foreign direct investment (FDI) in defense and insurance raised from 26 percent to 49 percent will provide a big relief to the capital-starved private insurance sector and get much needed capital from overseas partners. The requirement of the built up area and capital conditions for FDI is being reduced from 50,000 sq m to 20,000 sq m and from USD 10 million to USD 5 million respectively with a three years post completion lock-in; thereby encouraging development of smart cities. Further, government’s move towards proposing Rs. 7060 crore to develop 100 smart cities will lead to rapid urbanization and help accommodate the burgeoning population migrating from rural to urban areas to reap the benefits of overall growth and advancement.
The investment of INR 500 crore for setting up IITs and IIMs will help to meet the huge demand for skilled workforce in India. The 10,000 crore startup fund for new business will surely bring a huge boost in skilling the youth and empowering them. The government’s focus on infrastructure, MSME, agriculture and rural supply chain is a step in the right direction and will help sustain growth. Further, the government’ step to operationalize SEZs will revive investors’ interest to develop better infrastructure and to effectively and efficiently use the available unutilized land. This move will help in strengthening industrial production, economic growth, export promotion and employment generation. Though the budget signals progressive reformation of the economy, we are yet to see what solution the government brings in to GST, it being a significant tax reform measures. Additionally, there hasn’t been any change to the current retrospective taxation rules, however, the government assured that all retro tax cases will be scrutinized by a high level committee.
Mr Nadir Godrej, Chairman, CII National Committee on Chemicals
“CII National Committee on Chemicals welcomes the growth-oriented budget presented by Hon. Finance Minister Mr Arun Jaitley. The reduction in customs duty is welcomed as it helps address our demand for correcting the inverted duty structureand will also help boost domestic manufacturing. The budget also proposes to introduce a new urea policy, increase connectivity with ports and setting up of new IITs, IIMs with a view to promote talent; all these proposals are steps in the right direction.”
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Anoop Pabby, Managing Director & CEO, DHFL Pramerica Life Insurance
“The Union Budget 2014 presented by the Finance Minister today, is a positive for the country, and shows some much needed fiscal practicality. The intent of the Finance Minister to strengthen and modernize regulatory framework in financial sector to meet challenges of a complex economy is welcome.
From an insurance industry standpoint, the increase in the FDI cap in insurance from 26% to 49% will bring in the requisite growth capital from foreign promoters and will help deepen penetration of insurance solutions in the Indian rural markets.
On the personal tax front, the increase in personal I-T limit to from 2 lakh to Rs 2.5 lakh and increase in threshold of exemption under 80C investment cap from Rs 1 lakh to Rs 1.5 lakh will put more disposable income in the hands of the individuals. This will also encourage individuals to go for more long-term savings plans (including insurance plans), that provide funds for long term infrastructure projects.
The industry was looking forward to the removal of service tax on life insurance products, and the abolition of service tax on micro-insurance products of Sum Assured of upto Rs. 50,000/- is a welcome first in that direction.”
