The Indian finance
minister Arun Jaitley on 10th July, 2014 had presented the Union Budget 2014-15
in the midst of high expectation from the middle class and industries. According
to the market players, across the political spectrum the reaction towards the Union
Budget for 2014-15 have been fairly predictable and for most of the chemical industry such as pharma and fertiliser industry were quite disappointing
for most of the chemical industries. However the Indian finance minister Arun
Jaitley have come up with few comprehensive ideas such
emphasis on renewable energy and agriculture, improving the
infrastructure by making better ports, roads and rail linkages.
Furthermore talking
about curtail on custom duty in the budget proposals, there
was diminutive to an unambiguously show for the chemical industry. Basic
Customs Duty on a few basic petrochemicals such as ethylene, propylene,
butadiene and o-xylene (OX) has been cutback from 7.5% to 5% and 10% to 5% on
crude naphthalene. With the decreased in the Basic Customs Duty, producers of naphthalene
which produces dye intermediates as well as of
naphthalene formaldehyde sulphoxylates which are basically used in the
construction industry as a concrete admixture will merriment cheaper imports of
crude naphthalene.
Moreover the
budget proposals have seen few segments in paints and
coating industry, pharmaceuticals industry and fertiliser industry. The coating
industry directly and indirectly might be a recipient of the proposals and
demand for paints might be certainly collision due to higher tax immunity and
incentives for savings which may perhaps abscond more money in the pockets of
consumers.
For the pharmaceuticals
industry the Union Budget 2014-15 has no specific proposals and have only
focused on one part of the segment – health care. The finance minister looks
forward to concentrate of healthcare segments by setting up four AIIMS in
different parts of the country and number of government medical colleges and
also improving public infrastructure that will boast optimistic impacts.
Moreover to reinforce the States Drug Regulatory and Food Regulatory systems the
Central Government for the first time will provide central assistance by
creating new drug testing laboratories and will also make the 31 existing state
laboratories stronger. However the Union budget 2014-15 of 2014 for pharma
sector is quite growth-oriented, balanced and a realistic budget.
This year the Union
Budget 2014-15 for the fertiliser industry is to focus to frame a new urea
policy and on the fertilizer business the overhaul subsidy regime will have a
positive impact. Furthermore the finance minister had declared the conception
of an Agriculture Infrastructure Fund of Rs. 100 crore to shore up
research and development, in order to give an impetus to investment in
agriculture and make the farming more competitive. According to the sources the
Finance Minister had further added that the corrosion of the soils was in turn
resulted due to concerns regarding inequity in the utilisation of different
types of fertilisers that were mounting high. However, according to the
researched report the reform for the chemical industry is vital with its long
value chains.
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