Finance Minister Arun Jaitley mentioned "industrialized" 16 times in his Budget speech, enough to get smiles on the face of most manufacturers. From hi-tech chip companies, who need to invest billions in production units, to the small and medium company who invests Rs 25 crore, there was incredible for everybody.
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The Budget clearly made a case for more family mechanized by doing away with the upturned duty organization for many products that made domestic manufacturing uncompetitive. Importing a finished IT hardware product, for instance, was more profitable than manufacturing and selling it in India because of common duties on electronic components used.
Jaitley now has corrected the incongruity. He has exempted all inputs and machinery used in the manufacture of personal computers from the four per cent special additional duty (SAD). He has also exempted SAD on PVC sheet and ribbon used for the manufacture of smart cards and on parts and raw equipment obligatory for the manufacture of wind-operated generators. Furthermore, the FM has imposed education cess on imported electronic products - that would bring equality between nationally affected products and imported ones.
"While it would improve familial modern of IT hardware, the only displeasure is that the SAD immunity has not been complete to all electronic products," Sunil Vachani, Chairman and Managing Director of Dixon, an electronic manufacturing service supplier, said.
Vachani, however, will be happy with another declaration in the budget that seeks to give confidence more family construction of old cohort television such as cathode ray TVs, which still has a big market in India. Jaitley has exempted colour picture tubes from basic customs duty to make cathode ray TVs cheaper. The duty dispensation may help perk up manufacturing of such TVs. The FM has also done away the basic customs duty on LCD and LED TV panels of below 19 inches from 10 per cent to zero to encourage domestic production.
"We will see investments coming into the television sector in the next six months," Vachani hoped.