Industry left out of 'inclusive growth'
This budget has three backdrops moderating growth, rising inflation and oncoming elections. The final result is an ambitious balance among the conflicting agendas.
| Rashesh Shah MD & CEO, edelweiss capital |
This budget has three backdrops moderating growth, rising inflation and oncoming elections. The final result is an ambitious balance among the conflicting agendas.
The objective of greater social equity is welcome the announcement of the huge debt relief for small farmers even at the cost of missing the FRBM target for revenue deficit, is not.
As there have been corporate debt restructuring and OTS, there has to be similar mechanism for farmer loans. It is time to reiterate that there is no substitute to agricultural and rural infrastructure for enduring solutions for problems faced by rural India.
The Budget stresses on encouraging domestic consumption. Cutting Cenvat, excise, and central sales tax across various sectors, and raising the income-tax threshold and slabs for individuals are steps towards boosting demand.
Lower duties will also address inflationary concerns to some extent and is a welcome move for a majority of the business sector.
The proposal to increase the short-term capital gain tax and the proposed rule for setting off securities transaction tax (STT) are disappointing from the capital market���s point of view. But the markets will overcome their disappointment soon; as they have always done.
Nevertheless, the positives for the capital markets in the form of removal of the double taxation of DDT or the initiatives to expand the market for other financial instruments like corporate bonds, exchange-traded currency, interest rate futures and credit derivatives appear deficient at the moment to counter-balance the negative sentiments.
On a lighter note, many in the corporate sector and urban India are now seeking ���inclusive��� growth they also want to be included!
The objective of greater social equity is welcome the announcement of the huge debt relief for small farmers even at the cost of missing the FRBM target for revenue deficit, is not.
As there have been corporate debt restructuring and OTS, there has to be similar mechanism for farmer loans. It is time to reiterate that there is no substitute to agricultural and rural infrastructure for enduring solutions for problems faced by rural India.
The Budget stresses on encouraging domestic consumption. Cutting Cenvat, excise, and central sales tax across various sectors, and raising the income-tax threshold and slabs for individuals are steps towards boosting demand.
Lower duties will also address inflationary concerns to some extent and is a welcome move for a majority of the business sector.
The proposal to increase the short-term capital gain tax and the proposed rule for setting off securities transaction tax (STT) are disappointing from the capital market���s point of view. But the markets will overcome their disappointment soon; as they have always done.
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Nevertheless, the positives for the capital markets in the form of removal of the double taxation of DDT or the initiatives to expand the market for other financial instruments like corporate bonds, exchange-traded currency, interest rate futures and credit derivatives appear deficient at the moment to counter-balance the negative sentiments.
On a lighter note, many in the corporate sector and urban India are now seeking ���inclusive��� growth they also want to be included!
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