JOIN USChawla sees vote on account budget
Briefing reporters, he said, “the interim budget (for 2009-10) as approved by Parliament will be in operation till end of July. So, the new government will be able to carry on meeting day to day expenditure till then. If, it is not possible to pass full budget by August 1, we may need Vote-on-Account for another short period beyond that.”
“Once the new government is formed and the Finance Minister is in position, the Cabinet will decide the date by which the full budget will be ready. Therefore it will be difficult on our part to say anything (about the Budget day),” he said.
The Congress manifesto has promised to bring the budget within 45 days of formation of the new Government.
The Indian industry is expecting the forthcoming budget to focus on necessary fiscal measures through moderate taxation to boost demand in the economy and promote investment sentiment. While presenting the interim budget the government supplemented the stimulus packages unveiled by it earlier by announcing fiscal measures to spur demand in the economy. The interim budget for 2009-10 had effected cut in Excise duty and Service Tax to boost demand for wide range of consumer durables as part of strategy to boost overall economic growth.
Lending rates
Meanwhile, In what would augur well for the industry facing slowdown, the Finance Ministry expressed hope that banks will bring down their lending rates.
“We are very clear in our mind that the economic environment clearly points towards southward movement of the lending rates. Banks are aware of that and we expect them to move in that direction,” Finance Secretary Ashok Chawla told reporters here.
Chawla, however, said that it was up to the banks to take a call on the timing and quantum of rate cuts. “How much and when precisely (banks will cut rates) is the decision that banks have to take,” he said. With industrial output contracting, industry is demanding cheaper cost of funds, including lending rates of banks.