London: Chairman of London-based Caparo group Lord Swraj Paul today (July 8, 2004) joined NRIs from various parts of the world in hailing the Indian Budget as "positive" and "growth-oriented" that would help reduce poverty because of its thrust on Agricultural development.

"Agriculture has a big potential for exports because sooner or later the West will have to cut Agriculture subsidy and then India can be a supplier of food and agriculture products to the whole world," Lord Paul, Co-Chairman of the Indo-UK Round Table, said.

He said, "Agriculture is now a high-tech business and not a low-tech business."

"I would have liked to see more focus on health because it is the health which is going to reduce costs and improve productivity. Secondly, we must make literacy a Fundamental Right. We also improve the quality of education because that is the way progress is going to come.

"Overall, it is a positive signal which was very much required since the formation of this Government," Lord Paul, who is also Britain's Business Ambassador, said.

Responding to the volatility in the stock market, he said one should not worry too much about stock market, which is a "fashion business".

"In the end, economy is going to be made by working hard. In the last five years a confidence has come in the people of India that thy can do it and we must make sure that confidence remains," Lord Paul said.

NRI business community and organisations in the Gulf welcomed the Budget proposals for rural and agricultural development, but expressed disappointment that NRE deposits in India were being taxed.

"The Budget is growth-oriented and will help lower poverty because of its thrust on agriculture and rural development but the move to tax NRI interest income was a blow to overseas Indians," Ismail Hukkawalah, President, Indian Business and Professional Council (IBPC), said.

"The move will not only plug flow of funds from abroad to India but NRIs may also move their funds out of India," he said.

K V Shamsudheen, Director Barjeel Securities and Chairman Pravasi Bandhu, an NRI organisation, said the proposal to continue to exempt equity-related Mutual Fund from Dividend Tax will be healthy for the stock market.

He said the provision for drinking water, education and healthcare for the poor, allocation of Rs 30,000 crore for water-related projects and aid to SC/ST farmers to start a massive nationwide water-harvesting scheme will all have a salubrious effect on poverty eradication, which was essential for the emergence of a strong nation.

He felt that the NRIs need not have been taxed as they have always extended their support in hours of foreign exchange crises.

Ram Buxani, a leading member of Indian business community who was away in Singapore to attend a seminar, hoped the Government would not go ahead with the move to tax the NRIs, but lauded Finance Minister P Chidambaram for focussing on rural sector and education.