Indian Union Budget 2010

The Finance Minister


This morning as I was watching The Budget, it took me a while to understand the reason behind the uproar of the Parliament. The primary reason behind the hulla-bulla was The Finance Minister - Pranab Mukherjee's decision to hike petrol and diesel prices by 1 rupee per litre and even an overall increase in the M.R.P of passenger automobiles.

I do not know if I would have reacted in a similar way, like the Opposition did, though I would for certain have responded against his preceding statement -

"To remedy the difficulty faced by manufacturers of electric cars and vehicles in
neutralising the duty paid on their inputs and components, a nominal duty of 4 per
cent on such vehicles imposed. Some critical parts or sub-assemblies of such
vehicles exempted from basic customs duty and special additional duty subject to
actual user condition. These parts would also enjoy a concessional CVD of 4 percent."

All of this due to the rising costs these companies are facing is not asserting whether costs would curb via the duty, in the future.

I do not think this is the right way to go about such a situation. If costs are mounting, the government should assure there is no tax on the import of such components and parts of these vehicles.

The positive development announced at The Union Budget was -

"A concessional excise duty of 4 per cent provided to “soleckshaw”, a product
developed by CSIR to replace manually-operated rickshaws. Its key parts and
components to be exempted from customs duty."

These are going to be the solar powered, public transport vehicles, known as the rickshaw.

Its only time which can tell whether these developments are going to be taken in the bright light!