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Union Budget 2005-06 Analysis by X-Fin, XIM Bhubaneswar Another aspect about Budget 2005-06 that Mr. Vidyasagar drew attention was the move by the FM to emphasize the development of rural infrastructure through private sector participation. He felt that the Government should have an institutional policy in place to ensure this investment due to the general stigma associated with investing in government projects due to several reasons. Mr. Vidyasagar then shared his views about how the agricultural sector, the backbone of our economy and how it could be developed. He pointed out the importance of irrigation in agriculture and the Indian Economy. He stressed the importance of Micro-irrigation and Micro-Finance in order to take agriculture ahead and predicted that the fertilizer industry in India would soon become a LNG based industry. He then ventured into the Fiscal aspect of the budget raising doubts about devolution of funds from centre to state and predicting that there will be a hit in the overall expenditure of the government and thus there maybe a rise in the Fiscal Deficit. He ended with the hope that proceeds from disinvestment would help the government recover its finances. The next speaker to take the dais was Mr. B. C. Roy, who mainly concentrated on the infrastructure sector. He started his talk by saying that this budget was only a political statement to please everybody involved. He pointed to the fact that India will require nearly 150 billion dollars of investment in infrastructure. He sought to give reasons as to why the private sector would not invest, the prominent among them being the fact that any investment in infrastructure would involve a lot of sunk costs and also involve a long gestation period. Therefore, he stated that the government should ensure profit to the private sector and also try to build confidence among the private sector. Mr. Roy felt that the aam aadmi or common man has a lot to gain from this budget with the tax reform and the waiver of custom and excise duty reducing the prices of products. Contributed by - |
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