Capital market will get impetus
A bold budget, which has broken new ground in pioneering reform in the areasof labour legislation and small-scale sector dereservation. The budget willboost the capital market. Good initiatives have been taken on the educationfront and the loans for education idea is innovative.Dereservation of 140 items in the small-scale sector is a positive decision,as also the decision to reduce interest rates on small-scale deposits by 1.5per cent.
The government has taken a step in the right direction by announcingdismantling of the Administrative Price Mechanism (APM) in the petroleumsector by April 2002.
Other notable decisions include abolishing the banking service recruitmentboards, doing away with all I-T surcharges (except 2 per cent in Gujarat),abolishing the 10 per cent custom surcharge and dividend tax back to 10 percent. This will put more money in the consumers' pockets. With more money,consumers will rally in the stock market and investment will go up.
The government's thrust on infrastructure is going to have a notable impacton the health of the country. The overall effect of the budget is positiveand will definitely revive interest in India as an investment destination.
(Ravi Bhoothalingam is president, EIH Ltd.)
Copyright © 2001 Indian Express Newspapers (Bombay) Ltd.
