Budget Reaction - Gartner

Budget reaction Quote by Partha Iyengar - VP distinguished analyst and regional research director, Gartner, India.

The budget overall was a disappointment in the context of the huge expectations everyone had in terms of the bold brave strokes that Mr. Mukherjee was expected to (or everyone was hoping he would) paint for the direction of the Indian economy. Instead it has turned out to be a sober, minimalist, practical budget with some tweaks and correction of anomalies (e.g. dropping the FBT tax) rather than any major path-breaking steps.

From an IT perspective, the two main areas of expectations related to an aggressive stance on education and infrastructure reform. While there were some steps on the infrastructure side, very little to no attention was made on the critical education front, specifically revamping of primary education. Some allocation and ‘tinkering’ with the IITs is not what India needs now, but unfortunately that is all we have gotten in this budget. The 1 year extension of the tax holiday was a good move in that it provides some short-term relief, but also clearly puts the writing on the wall that this is not a scheme that is going to be continued beyond this 1 year extension, thus allowing IT companies to plan accordingly for the medium to long term.

Some of the bold measures expected were also as it relates to aggressive disinvestment, FDI reform, specific pronouncements on increase in focus on governance and transparency of money being spent. None of these had any mention, other than an oblique reference to PSU disinvestment.

Overall, a fairly ho-hum budget. Maybe there is more to be read in Mr. Mukherjee’s preamble that talked of the budget not being the ‘be all and end all’ of policy statements, and this might have been the first concrete step in that direction.

Corporate VoiceWeber Shandwick

Vilco Centre, ‘B’ Wing, 4th Floor,

# 8, Subhash Road, Vile Parle (East),

Mumbai – 400 057, India

T: 40311215 F: 26820504

http://www.webershandwick.com/

Advocacy Starts Here.

Media's Asia Pacific PR Campaign of the Year 2007/2006

Media's Asia Pacific Network of the Year 2006

United Nations Grand Prize for PR Excellence 2007/2006/2005

IPRA Golden World Award Grand Prize for PR Excellence 2007.

P Please consider your environmental responsibility before printing this e-mail.

This message contains information which may be confidential and privileged. Unless you are the intended recipient (or authorized to receive this message for the intended recipient), you may not use, copy, disseminate or disclose to anyone the message or any information contained in the message. If you have received the message in error, please advise the sender by reply email, and delete the message. Thank you very much.