Budget 2015 may bring in some changes in tax structure: Aditya Puri, HDFC Bank

In a chat with ET Now, Aditya Puri, MD & CEO, HDFC Bank, talks about his expectations from the Budget 2015. Excerpts:

ET Now: With the budget just a week away, what are your expectations? Are you looking out for any big-bang announcement?

Aditya Puri: I think this budget should be seen as a continuation of the government’s policies. To that extent, we could possibly expect to see a rationalisation of subsidies.

I am saying rationalisation, not reduction. This is because it’s important that subsidies reach the intended beneficiaries.

We may see some changes in the tax structure — a step aimed at promoting investment and savings. Both of these are important. We may also see some procedural simplification coming in.

We may see some further announcement on centre-state allocations as well as sharing and budgeting processes. Some of it may come in the domain of the GST. Also expected are some changes in the agriculture policy.

We are also looking forward to a clearer definition on ‘ Make in India’. It is going to be crucial if we are to raise manufacturing.

Basically, it would be a continuation of what the government has been saying and doing.

Let us not look at this as a sprint. This is a marathon. We are in the right direction.

ET Now: List out three things that you expect from Finance Minister Jaitley, things that could bring about significant changes on the ground?

Aditya Puri: It hasn’t merely been a lot of talk, as the popular perception goes. There has been a lot of work too. Work is going on to ‘Make in India’ a success, and make things easier. There is a hell of a lot of work going in on power, minerals, infrastructure financing, etc.

There have been substantial discussions in terms of how best to have the Centre-state relation up and about. Will see some of it in the budget.

Industry needs the issues of land acquisition, environment clearance, coal, minerals policy, and agriculture pricing & mechanism to be sorted out. I don't know if these will be sorted out in this budget itself, but they will be sorted out.

ET Now: One school of thought believes that the government should not be tied down by the fiscal deficit numbers, and instead give growth a chance. Where do you stand in this debate?

Aditya Puri: Trying to artificially promote growth by way of means like QE does not increase demand. It only creates other issues. RBI Governor Rajan and Finance Minister Jaitley appear to be on the same page on the matter of fiscal deficit.

It is expected that money will come in from coal and spectrum auctions. If that becomes a reality, it will help the government continue with the required fiscal discipline. They will find innovative means of financing, and the public sector will start spending too.

On fiscal discipline, the government is moving on the right path. It will help the RBI cut rates going forward.