Most of the promises made in the previous budget have been fulfilled.

Achievements by the present government.

The Finance Minister had made promises in the previous budget out of which he has fulfilled almost all of them. This is a very positive sign of proposals being implemented. Is is expected that the finance minister will be able to fulfill promises made during the current budget. As a part of liberalisation measures, the government has taken the following steps in the last 9 months.

• New Income Tax Act

A committee had been appointed to draft a new and simplified income tax act. The committee has given its report. Proposal to abolish tax on dividends and levy 10% tax on companies - is a part of this report. This proposal is implemented in the budget even before the report was published. The bill for the new act will be presented in a few months in the parliament.

• New Companies Act

A committee had also been appointed to draft a new and simplified Companies Act. A draft Bill has been published. The bill for the new companies' act may be introduced in the monsoon session of the parliament.

• New Foreign Exchange Law

The Finance Minister has proposed to bring in a new law titled - The Foreign Exchange Management Act (FEMA). The objects of FEMA will be :

• to have a new law which is consistent with full current account convertibility, and

• progressively move towards capital account convertibility.

The Government has requested the Reserve Bank of India to appoint a group of experts to lay out a road map for capital account convertibility. A first deliberate step has been taken to bring about capital account convertibility.

Our views on the subject have been mentioned in the letter to the Finance Minister.

• Disinvestment

The Government have appointed a disinvestment commission. The commission has been asked to give interim reports as the work progresses - and to suggest steps to be taken for disinvestment of PSUs. Wherever possible the commission will also suggest restructuring. The commission has already given a few reports. For nine well managed companies like IOC,ONGC, IPCL, etc. (Navratnas as the companies are referred to), the commission has recommended that almost full autonomy be given to them. The Ministry of Industries has also agreed in principle for the autonomy. For some others, restructuring/disinvestment has been suggested. Our views are also given in the letter to the Finance Minister.

New laws will be introduced for tax, Company Law & FERA.

• Foreign Investment

The Government has expanded Annexure III - the list of industries where automatic approval will be given to foreigners for investment upto 51%. Two more categories or schemes have been introduced - 50% scheme & 74% scheme.

In case of 50% scheme, mining sector has been covered.

In case of 74% scheme, infrastructure areas have been covered.

Guidelines have been laid down for Foreign Investment Promotion Board (FIPB) to take decisions in case of foreign investment proposals which do not fall under automatic approval.

• Depository for shares

A depository was set up whereby shares can be traded in electronic form. This step should go a long way in reducing the frauds which happen on account of share transfer, delivery, etc.

• Reduction in Excise and Custom duties

Keeping in line with the policy of the government, the excise and customs duties have been further reduced. The reduction will continue upto the year 2000 by which time, it is expected that the duties will be similar to many developed countries.