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JUSCO, urban infrastructure service provider <h1>JUSCO, India’s 1st Comprehensive Urban Infrastructure Services Company</h1>
Engineering Procurement & Construction (EPC) Power Service Division Integrated Township Management
:: Reaction on the Union Budget FY 10

A balanced budget as far as common man goes. The highlight is the FM’s commitment to restore the growth rate to 9%. The initiative for more private sector participation is an indication of the Government’s focus in removing bottlenecks for investments and projects. Government’s commitment to introduce GST (Goods and Services Tax) by 1st April 2010 is indicative of its desire to reform the indirect tax system. Similarly, introduction of new direct tax code and making it open for debate makes Government’s commitment to reform the direct tax system apparent.

Industry was expecting a drop in corporate tax rate or at least abolition of surcharge. No change in corporate tax has disappointed the industry. However, the fact that Government has almost left indirect taxes untouched is not disruptive and should be seen as positive.

The budget has increased significant allocation towards infrastructure including the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) and on highway spending. This is a move in the right direction and I believe we need to continue to allocate significant resources in this area for the next decade. FM has tried to boost the rural economy by announcing several measures including broad basing National Rural Employment Guarantee Scheme (NREGS).

As for JUSCO and similar urban infrastructure sector industries, the increase under JNNURM grant would definitely give a boost to this sector. Personally, I would have appreciated reforms in the water sector, similar to what has been done in the power and telecom sector. There is a need to treat water & waste water sector as a priority sector for accessing debt especially when private sector participation is being encouraged in this filed by the government. This would enable service providers to give better service at affordable rates to end users.

On specifics, abolition of FBT, abolition of surcharge on personal income tax and increase in exemption limits of personal income, though marginally, are welcome moves. Similarly, extension of tax holiday to export oriented units by one year would be helpful although I believe extension could have been granted for longer period.

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