In a discussion on the budget held by KPMG ( a consultant major)and Confederation of Indian Industry (CII) here on Saturday, executive director, KPMG, Hitesh Gajaria observed that the pre-election Budget of the UPA government is not poised for the industry and especially for the pharmaceutical sector.

“While the Union Finance Minister has reduced the excise duty by 8 per cent, the abetment too has been reduced from 42 to 35 per cent, which has not been publicised enough,” Gajaria said, adding that in view of such a situation, the pharmaceutical industry will not be able to pass on the total benefits of reduction in excise duty to the consumers.

“Similarly, in the automobile sector, while preferential treatment has been meted out to the small car segment, the other segments remains unchanged,” he said, adding that the budget has, however, been successful in creating a feel good factor among the salaried people due to the raising of the tax slabs, which will encourage people to save more.

Dwelling upon the waiver on the agriculture loans, Gajaria said that while politically, parliamentarians could not oppose the move at the peril of being branded ‘anti-farmer,’ it remained to be seen from where the money for the waiver would be generated.

“Not only that, the burden of this waiver will have to be borne by the next budget maker as well. Apart from that, the question also remains whether such a waiver ensures the best economic behaviour as well,” he said.

“With waivers like these, people will be tempted to take loans and not repay them,” Gajaria said, adding that there is also no surety that this will ensure that farmers will not commit suicides anymore.