First-cut analysis: Industry
Cars
Positive impact, due to reduction in excise duties on cars and high customs duty on 2nd hand car imports.
Cement
Positive impact, due to increase in plan allocation to National Highway Development Project for construction of highways, and due to tax exemption on interest for housing loan from Rs 1,00,000 to Rs 1,50,000.
Hotels
Negative impact, as food and beverage costs are expected to increase due to the imposition of CVD on imported liquor.
Information Technology
Positive impact, due to expected increase in computerisation of govt. departments, PSUs, insurance companies, banks, by March 2002. Tax holiday facility under sections 10A/10B extended even when there is change of ownership. Onsite services are also eligible for tax exemption.
Organised garment producers
Negative impact due to imposition of excise duty of 16 per cent on branded garments.
Pharmaceuticals
Positive impact on major Indian pharmaceutical companies, due to the extension of benefit of weighted deduction given on R&D expenditure to expenditure incurred on biotechnology research, clinical trials and expenditure incurred on regulatory approval.
Telecom equipment
Negative impact on equipment manufacturers due to reduction of customs duty to 15 per cent on products
Telecom services
Positive impact due to reduction in customs duty on equipment. Positive impact on new broadband, internet, and basic and cellular projects starting after April 2000 due to tax holiday.
Textiles
Cotton yarn
Positive impact due to withdrawal of concession on excise duty to SSIs.
Composite mills
Positive impact due to imposition of ad valorem duties on independent textile processors.
2-wheeler
Negative impact, due to increase in excise duties on 2-wheelers.
Commercial vehicles
Positive impact, due to accelerated depreciation of 50 per cent in first year, and increase in outlay for roads.
Tractors
No significant impact
Auto ancillaries
Positive impact, due to benefits provided to cars and commercial vehicles.
Rediff-CRISIL Budget Impact Analysis
Budget 2001
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