Budgeting for a knowledge-led economy
The Financial Express — March 1, 2005

The finance minister chose to make the Budget credible through a package of initiatives rather than a few big ideas. He has attacked issues facing the economy comprehensively, and the renewed thrust on agriculture, textiles, infrastructure and education, reduction in the corporate tax rate, promotion of savings and continuing reforms in indirect and direct taxes will sustain India’s high growth trajectory.

The lowering of corporate tax rate should encourage investment although the reduction in the depreciation rate needs to be reconsidered in the context of sectors like IT, where technology becomes obsolete and needs to be upgraded. Greater levels of investment can also be expected from the banking and financial sector, which received many positive changes. The Centre’s recognition that India is emerging as a knowledge economy is noteworthy, as are the various education and skill development policies designed to accelerate this trend.