Srinagar, Feb 26:  The Federation Chamber of Industries Kashmir has welcomed the initiatives in the budget 2010-11 on MSME sector, while expressing mixed reaction to other proposals.
While welcoming the initiatives taken to support micro, small and medium enterprises, the FCIK conveyed its concern on fuel hike that, it said, in turn would increase inflation.
At a meeting of the administrative council chaired by FCIK president Shakeel Qalander, the members expressed satisfaction on the measures taken in the budget for supporting and strengthening the MSMEs by acceding to all recommendations of the task force set up by the Prime Minister to suggest an action plan for the sector for sustainable growth.
The FCIK has also welcomed establishment of the Prime Minister’s High Level Council to regularly monitor the implementation of such recommendations as it has been observed that no measures earmarked work unless the same are monitored at the highest level.
The FCIK has welcomed enhanced allocation for the sector besides raising the corpus for micro-finance development and equity fund aimed at exclusive lending to the micro sector.
The meeting also welcomed interest subvention of 2 per cent for export oriented units and observed that this would benefit our handicraft and food processing industry.
The members welcomed increase of turnover limit for compulsory audit from present Rs 40 lakhs to Rs 60 lakhs although the industry had pleaded raising of such a limit to Rs 1 crore.
Besides, it was observed that the revised slabs proposed for personal income tax as well as reduction in surcharge will together benefit the salaried and business class.
The members hailed the initial allocation of Rs 1000 crores made for setting up of National Social Security Fund for unorganised sector workers including weavers.
The increase in the excise rates in respect of various industrial products may help the industrial units of J&K state presently under renewed exemption from such a duty but could result in further increase in inflation.
The FCIK members have, however, expressed deep concern on the fuel hike that would result in increase of prices of all products and services. Although the budget has raised concern on growing inflation yet no measures have been taken to curb or control the same, the members further observed.
The increase in minimum alternate tax rate from current 15% to 18% was likely to harm the interests of the corporate assesses, the members said.
The president FCIK while speaking at the meeting termed the budget as visionary for the development of industrial sector particularly in the micro, small and medium segment.
He said that  MSME units, comprising more than 90 percent of the total business enterprises in the country, spread both in organized and unorganized sectors was acknowledged for the first time to be of paramount importance for overall development of the Indian economy.
He said that the focus of the union budget continues to be on the vital sectors including infrastructure, agriculture and allied sectors, rural development, education and health.
The substantial increase in the allocations made for development of infrastructure including energy sector aimed at overall growth impetus and will go a long way to globalise Indian economy.

Lastupdate on : Fri, 26 Feb 2010 21:30:00 Makkah time
Lastupdate on : Fri, 26 Feb 2010 18:30:00 GMT
Lastupdate on : Sat, 27 Feb 2010 00:00:00 IST