Bolstered by fiscal sops given to the industry by the Government on Tuesday, business chambers have demanded monetary interventions as well to perk up the slackening manufacturing sector.
"The economy needs intervention by the government and regulators. Therefore, fiscal incentives become very important and excise duty cut would have a major positive impact on the corporate manufacturing sector," industry body CII Director General Chandrajit Banerjee said.
President of industry body Assocham, Sajjan Jindal, said the cut in service tax would provide great relief to the industry as well as the general public.
Industry body PHDCCI, while welcoming the cut in service tax, said a further reduction of 2 per cent in service tax would be more desirable.
The Government announced a Rs 30,000-crore boost to the slowing down economy by cutting excise duty and service tax by two per cent each and extending a four per cent reduction in excise duty, provided in the first stimulus package, beyond this fiscal-end. It also announced cut in excise duty on bulk cement by two per cent.
The industry chambers also demanded cut in repo and reverse repo rates, the key policy rates of the Reserve Bank of India.