Great balancing act, Government has not allowed Left to hijack budget
Budget Reaction of Habil Khorakiwala, Chairman, Wockhardt

Mumbai, July 8, 2004

Union finance minister Mr. P Chidambaram has done a fine balancing act by addressing the concerns of the Left and continuing with liberalisation and reforms. He has belied fears that the Left will hijack the budget and send the wrong signals.
The minister deserves kudos for a slew of innovative schemes to uplift the rural population, such as water management programme, tax holiday on food processing, food stamps and agricultural insurance.

The 2% cess that will yield Rs. 5,000 crores a year for education is a gigantic leap if implemented properly. In fact, the budget has set the right directions in terms of priorities and allocations. The acid test will be in execution. The real challenge is to see that the benefits of the schemes reach the intended people.

At the same time, he has sent the right signals to the industry and world at large by raising the foreign direct investment cap in key sectors like telecom and airports.

We are disappointed that there is nothing in this budget to promote R&D in pharmaceutical sector, which the industry expected and deserved, against the background of the new patent regime beginning on January 1, 2005. The Finance Minister has provided incentives to R&D in automobile sector but left out pharmaceuticals. I hope he will make amends for this omission before long.

RATING: 8 out of 10