In the current times any finance minister would have fallen a prey to the temptation of increasing income tax rates in the background of falling revenue and mounting deficits. The finance minister has successfully avoided this trap and gone a step further to take care of the hard-hit salaried class of earning incomes upto Rs 1 lakh by increasing the standard deduction from Rs 20,000 to Rs 25,000.

The finance minister has made a very genuine and reasonable attempt to deal with the negative impact of the US economic sanctions by providing welcomechanges for foreign direct investment and investments by NRIs. For increasing foreign direct investment the finance minister has proposed to appoint a monitoring officer, who will have "personal responsibility" to clear the project within 90 days.

It is rightly expected that as a result of fast track approvals foreign direct investment will be double within a short time. NRIs have been recognised for their contribution and their potential to the nation by giving them a special card indicating persons of Indian origin (PIO card) which will provide them several concessional and beneficial treatment.

For NRIs, two schemes for investment will be introduced by Unit Trust of India and State Bank of India with concessionals tax treatment and repatriation in currency of investment. Both these measures will considerably offset the negative impact of the US sanctions.

Reform in the insurance sector has been very cautiously accepted spartially by the finance minister. The insurance sector will now be open forprivate Indian companies and here lies the swadeshi spirit of the budget by still keeping it close for foreign companies.

The public sector undertakings are in for radical changes by way of disinvestment in specific companies and by deciding the closure of those units, which are not viable. The finance minister has none the less ensured that the workers in the PSUs to be shut down do not suffer from closure by providing attractive retrenchment package for them.

The three schemes in the tax regime such as Saral, Samadhan and Samman should create a better climate for voluntary compliance of the income tax laws. Saral will be one page income tax return, Samadhan will curb unnecessary and unfruitful litigation and Samman is recognition of high taxpayers. The nation, and the people responsible for implementing the budget owe a special duty to carry out the spirit of the Budget in these critical days to the best of their ability and honesty.