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‘Budget will stimulate growth in zari sector’

The non-regulated Rs 100-crore sector in Bareilly largely depends on cash transactions. The sector comes under the medium and small enterprises category, which has been provided rebate in the budget

lucknow Updated: Feb 02, 2017 14:50 IST
HT Correspondent
HT Correspondent
Hindustan Times
Union budget,Budget news,Uttar Pradesh
Zardozi workers of Bareilly.(HT FIle Photo)

Announcements in the Union Budget came as a ray of hope for zari-zardozi business in Bareilly region that was badly hit by demonetisation.

“The sector comes under the medium and small enterprises category, which has been provided rebate in the budget. This will stimulate growth in the zari sector, but traders must adopt some required financial changes in their set-up,” said Dileep Agarwal, a Delhi-based economist from Bareilly. “Traders must start paying workers and artisans through banking system and register their firms,” he added.

The non-regulated Rs 100-crore sector in Bareilly largely depends on cash transactions.

“Zari is a small sector, but it employs a large number of artisans and workers. Most of them are uneducated and it is a mammoth task to include them in the banking system,” explained Rafiq Raza Khan, a zari trader in old city area.

Apart from zari sector, the rebate will also benefit 400 small industries in the region. Industries in timber and agriculture sector are major source of employment in the region.

Along with tax rebates, locals also welcomed the announcement to reduce the limit of cash donations towards political parties to Rs 2,000. “The decision shows that the government is against corruption and black money,” said Yashwant Sagar, owner of a general store.

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Budget fails to attract MSME, leather units

The Union budget failed to meet the aspirations of the big industries in corporate sector. However, it gave some respite to over ten thousand micro, small and medium enterprises of the city and forty thousand in the state. These industries have a workforce of ten lakh people and has turnover of rupees six thousands crore per annum.

The big industries like the tanneries in the city were also disappointed as the budget did not provide any relief to them. Some prominent tannery owners pleading anonymity said that even after the recovery of huge black money the government failed to give any tax relief to the industries in the corporate sectors despite the fact that these industries were worst affected due to demonetisation and lost exports during the peak season.

“We were hoping to get some export and tax relaxations in the budget but the budget disappointed us,” said a tannery owner pleading anonymity.

Similarly, most of the owners of the micro, small and medium industry owners who were expecting reduction in tax rate for the industries with a turnover of rupees five lakhs to ten lakhs and from rupees ten lakhs and above.

A senior member of Indian Industries Association (IIA) MM Rajpal hailed the budget but said there should be relief in the tax rate from 20% and 30% for the industries with a turnover of rupees five lakhs to ten lakh and rupees ten lakhs and above respectively.

The general secretary of the IIA Sunil Viashya said that IIA had submitted a proposal to the government before the budget. The government has given some tax relief but it did not concede the demand of reducing the interest rate over the bank loan obtained by the MSMEs.

Satish Gupta, another IIA member said that the government should have given more relief to MSME sector as it heavily suffered during demonetisation.

The former president of Kanpur Chartered Accountant Society and the Income Tax Bar Association DC Shukla described the budget as populist with promises of faster developments. No enhancement in service tax provided relief to people but reduction in political donations upset the political leaders.

Reduction in cash expenses by the traders from Rs 20,000 to Rs 10,000 was not in the interest of business promotion. Instead of curtailing the limit of cash expenditure it should have been enhanced he added.

According to a farmer leader Hari Mohan Shukla there was no direct relief given to small or the big farmers but the government has introduced certain schemes for the welfare of the farmers, which needed implementation and monitoring so that the desired benefits could reach to the poor farmers.

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The budget was not welcoming for the employees. “There was no commitment for generating employment or for launching new programs for the working classes,” said the patron of the All India Trade Union Congress (AITUC) Arvind Raj Swaroop.

Chartered accountants watching the union budget in Agra. ( HT Photo )

Realtors buoyed, tourism sector disappointed

There was a mixed response to the union budget in Agra region, which is going to poll in the first phase. Realtors called it a balanced budget but stakeholders in the tourism sector were disappointed at the lack of ‘incentives’ provided to the Taj city.

“We had seen in the past that railway budget had turned to a ‘non event’ and now the union budget has also followed suit, appearing to have no political impact because other factors are affecting elections,” said realtor Hemant Jain, who described the budget as balanced and good for real estate.

Rajeev Saxena, secretary of Tourism Guild, expressed dissatisfaction. “There is no incentive for the tourism sector on which the Prime Minister had been focusing a lot. Announcement of tourism dedicated trains might hold good for religious destinations,” he lamented.

“This is not the first time that airports for better air connectivity have been promised but Agra, despite being city of Taj, awaits release of fund for international airport. Service tax was already imposed last month on travel trade and continues,” he said.

‘Agra falls in B category of cities and the stress of the union finance minister on affordable housing might benefit the real estate business facing a huge slump these days, more so with repeated increase in circle rate,” said Rohit Dua, vice president of Agra Chartered Accountant Association.

“Although there has been no compensation package for the ‘pain’ undergone by the common men due to demonetisation, the budget would have a positive impact for the BJP because it seems to be addressed to the middle class and farmers,” said Dua.

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First Published: Feb 02, 2017 14:50 IST