R Seshasayee, Managing Director, Ashok Leyland

I think these are quite positive. Clearly, the intention is to stick both to the larger agenda in terms of the tax reforms and the goods and services tax (GST) for 2010. I think it is a good indication. Although I doubt whether all the details would have been sorted out by then, but the commitment that has been made is a very welcome commitment and at the same time, the removal of the fringe benefit tax (FBT) is more in response to a sentiment which is also a good signal. I do not have much quarrel about the minimum alternate tax (MAT) going up to 15%. This is something which we must take in the stride.

I think we have, in a way, been victims of unrealistic expectations. What has been done is pretty reasonable. But, I would like comment on the point that both Udayan and Kamath made about bond yields. I think the market has to be convinced that the borrowing programme that the government can indeed be absorbed without the flare up of interest rate. I do not think that the budget, by itself, has given that kind of comfort. In fact, it has accentuated the concerns and there needs to be some articulation by the Central Bank to calm down so that the interest rates do not go up.

This budget is becoming very expenditure centric and this is how it has to be in the days of stimulation. What is being disappointing is that when so much money is being pumped into the system, we have not heard about what needs to be done by CFO of the country to ensure that there is not going to be no leakages. There are going to be new ways of productive deployment of these funds and I was hoping that something will be said to reform. This has nothing to do with politics. It is just to do with administration reforms. That is very worrying-so much money is being pushed through a leaky pipe.

I think, beyond this, it is not very realistic to expect clarity in the budget. However, we need to really figure out how the mechanism is going to work beyond the boundary conditions that has been articulated because they cannot again be discretionary. There needs to be formation of the governance process for doing that. That is still somewhat vague and that needs to be plugged in due course.

I think there is a lot of talk about excise cuts. I think this is too early to roll back perhaps there was only one case in terms of public transportation. JNNURM, for example, envisages a fairly large amount of fleet expansion and there was this expectation that public transport must now begin to get a lot more focus and therefore reducing the duty further was what was been talked about. I am quite comfortable with where it stays. There is no reason to say to roll back the duty reduction nor would I say that such compelling case to do away with the duty on the busses. We need to go though goods and services tax (GST) in a more calibrated fashion to bring down the taxes over a period of time to a more realistic level. But I am quite happy the way they are now.