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| Fresh stimulus: ED, ST cut by 2% | | | New Delhi, Feb 24: Giving relief to the industry reeling under the impact of slowdown, the government on Tuesday reduced by two percent rates of excise duty and service tax.
While the general excise duty has been reduced from 10 percent to 8 percent, the rate of service tax cut from 12 percent to 10 percent.
Four percent excise cut announced earlier in the stimulus package in December will continue beyond March 31, acting Finance Minister Pranab Mukherjee said while winding up the debate on the Interim Budget in the Lok Sabha today.
Mukherjee further said that duty on bulk cement has been reduced from 10 per cent to 8 per cent.
The government is confident of overcoming the impact of the global economic crisis on the domestic economy, acting Finance Minister Pranab Mukherjee said on Tuesday.
"We will overcome the crisis," Mukherjee said in his reply to a debate on the interim budget for 2008/09, adding that banks had been provided with enough liquidity to tide over any crisis.
Pointing to the economic progress made during the UPA’s five-year rule - even amidst unprecedented global crisis– Pranab asserted that it was during this government’s tenure that the GDP reached a growth rate of 8.6%.
Comparing with the performance of the NDA government, Pranab pointed out that during NDA’s rule the average GDP growth did not go beyond 5.8%.
Pranab also added that the investment as part of GDP has risen to 30.9% under UPA as compared to just 22.2% during the NDA.
Pranab also told the MPs that even though the government had come out virtually unscathed despite the ever growing global recession and a tremendous rise in oil prices, the UPA was still subjected to accusations of mismanaging economy.
He also took the opportunity to praise Manmohan Singh and P Chidambaram during their respective tenures as Finance Ministers and expressed confidence in the economic resilience of India - whose fundamentals remained strong. Claiming that the country can never “deviate from path of growth” under UPA although it may be slightly time-consuming, the minister asserted that policy changes were a continuous process implying that the government was open to them.
In an attempt to defend the situation at hand, Pranab said that even the developed countries were not free from problems and the economies of North America, Europe, Japan were all experiencing a downward trend.
The Lok Sabha later approved the Interim Budget by a voice vote, amidst a walkout by the Opposition BJP and erstwhile supporters the Left parties.
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