Modi budgets his poll promises
13 July 2014 1:33 AM GMT
Good Days Will Come’ was the roaring cry of assurance to the people of India during the 2014 Lok Sabha elections by Narendra Modi, who has now become the Prime Minister of India. This assurance is now being translated into reality through various moves and measures undertaken by his Government and the latest on this front is the Central Budget presented by Finance Minister Arun Jaitly that has already begun to draw bouquets or brickbats from all quarters.
Shyam Srinivasan, Managing Director & CEO, Federal Bank, said ‘This is the first budget from the Finance Minister, after the Government got a clear mandate and we are just months away from the second budget of the new Government. I would view this as a good beginning. The budget broadly met expectations by reassuring that the Government would not amend tax rules retrospectively — even though it is a Sovereign right — and has assured that GST would be introduced during the course of the year.’
‘Given the constraints that the government was facing, the budget was as we expected with good news coming in for the Infrastructure sector, more importantly the power and roads segment,’ said D.C Jain, MD & CEO, IDBI Capital. The increase in disposable income and the incentive for savings is a positive. Job creation and skill development seemed to be the underlying principles behind a lot of the moves and manufacturing will see some traction on the back of the proposals in the Budget.’
Vishwas Utagi, General Secretary, Maharashtra State Bank Employees Federation (MSBEF) and Vice President, All India Bank Employees Association (AIBEA), sounded the alarm when he stated, ‘Financial Sector Unions shall repulse the attack of private capital to highjack banking and insurance sector as reflected in central budget. 49 per cent FDI in insurance and clearance of pending insurance reforms bill will be the beginning of privatization of LIC and the four Public Insurance companies in India. The Jewel of India that is Life Insurance Corporation will be fully exploited by the corporates.’
The automobile sector was cautiously optimistic about the Budget. ‘The Finance Minister has delivered a well-defined and prudent budget with specific focus on infrastructure, manufacturing and rural schemes,’ noted Dr Pawan Goenka, Executive Director, Mahindra & Mahindra Ltd. ‘To view it in the macroeconomic perspective, it has laid clear emphasis on supporting investment. Though there were no big bang announcements, the intent of the budget is clear. In fact, I see this budget as a blueprint to the direction the government will take over the next nine months.’
‘The Budget 2014 is based on fiscal prudence with a progressive outlook,’ said Kenichiro Yomura, President of Nissan India Operations. ‘We appreciate his considerations and his aim to achieve 7-8 per cent GDP in 3 to 4 years. Structural reforms, including FDI liberalisation in defense and insurance, initiatives to support local manufacturing and commitment to remove retrospective taxation, are significant steps from a larger macro-economic perspective.’
A. Ramasubramanian, President, AMW Motors Ltd, said, ‘The measures for development of infrastructure development like highways, industrial corridors, housing, manufacturing, FDI in defence sector and power projects, are welcome and will contribute to demand generation for commercial vehicles, which have seen record lows in recent years. The Finance Minister’s announcement for tax holidays for infra projects with long gestation periods will encourage more entrants into the sector. The budget has attempted to address issues in several sectors of the economy, but industry will pin its hope on implementation, which has been an issue in the past.’
R N Rao, Director (Sales & Marketing) with AMW Motors Ltd said, ‘The speeding up of highway projects and development of 8,000 km of roads will give a boost to M & HCVs as also the measures announced in the power and housing sectors. Excise concessions for the automobile industry are being continued and recent trends in the commercial vehicle sector give us cause for cautious optimism. The recovery of the industry is closely linked to so many infrastructure and consumer sectors that it will be some time before an uptick in demand is continuous and healthy. However, the budget has sent positive signals for our sector.’
Ravi Uppal, MD & Group CEO of Jindal Steel and Power Ltd, highlighted the Jaitley budget as a positive and cheerful one. ‘On the whole, the budget is very positive. It is one of the most comprehensive budget presentations that I have ever witnessed, covering the entire socio-economic breadth of the country. Point by point, the Finance Minister recalled the promises made in its manifesto across all sectors and talked about how the government wishes to deliver on them. It covered everything: rural development, skill sets, infrastructure, sports, airports, waterways, navigation, power generation et al.’ ‘The budget brought good cheer for the power sector on two counts – first, power units that get commissioned by 31 March, 2015 will be assured of continuous coal supply and second, the extension of the tax holiday for power projects till 31 March, 2017, a necessary step given the number of power projects stranded for want of fuel or environment clearances. The extension will also renew the viability of the proposed projects.’
The budget also drew a reaction on REITs and FDI in real estate sector. Mike Holland, CEO of Embassy Office Parks, expressed happiness with the measures taken by Finance Minister Arun Jaitly for reviving the Real Estate sector. ‘It is absolutely appropriate that the government has taken up measures on the two fronts (FDI and REIT taxation provisions) which should both have a much needed positive medium term impact on the sector. The government intends to provide necessary incentives for the introduction of real estate investment trusts (REITs) in the country and will also enable REITs with a tax pass-through status to avoid double taxation. The various clarifications on tax pass through and Capital Gains Tax (CGT) are welcome and this creates a level playing field between REIT’s and other forms of indirect investment in the real estate sector e.g. equities in listed real estate entities. We look forward to seeing the details of the draft regulations but the overall sentiment is certainly quiet positive.’
In the hospitality sector, Vikas Chadha, CFO of Berggruen Hotels, described the Central Budget as ‘neutral’ in terms of the investment incentives into the hospitality sector. ‘We were hoping for some positive declarations for hospitality industry and incentives, as the sector is currently under pressure with lower revenue and high cost of debt. GST implementation by end of the year as envisaged in the budget needs to happen urgently so that it streamlines the indirect taxes, this will be relevant for us as we have Hotels Pan India in multiple states. This would ease the compliance and execution aspect on Taxes. On the direct taxes , we hope that the increase in limits both 80 C and basic exemption limits would help increase the disposable income in the hand of end customers, this could give rise to increased spend on travel and tourism which could benefit Hotel companies like Keys.’
This feeling was echoed by a Goan hotelier Edwin Fonseca of the heritage Astoria Resort. ‘Overall, the Central Budget is a good one and we should appreciate the Modi Government for it. It is a positive and welcoming budget which ensures that the middle class can travel comfortably. Also, it is nice that the government removed the 14.7% per cent tax on railways hike, while taxing luxury items like tobacco and soft drinks, and avoiding touching common food items and gold which is already on a high.’
The engineering sector too is positive about the Budget. Pradeep Bavadekar, MD, MITCON Consultancy & Engg. Services Ltd, Pune, noted: ‘In my opinion, by and large it is a good budget which is clearly aiming at reviving Indian economy through infrastructure development —leading India to be an investor-friendly destination. Less tax burden on common man for uplift of economy and more circulation of funds through increasing investment limits is a USP of this budget. The government has taken good steps for industrial and infrastructural development like creation of new textile clusters, 100 smart cities, new industrial clusters and biotech clusters.’
‘The agriculture sector, which is the backbone of the Indian Economy, will get a boost by increasing warehousing capacity in the country and also by allocating funds for separate agriculture infrastructure fund. The Government also has given more allocation to MSME sector of Rs 10,000 crore through venture capital fund which will be an encouragement for entrepreneurs.’ Subhrakant Panda, MD of Indian Metals and Ferro Alloys Ltd (IMFA), said, ‘The Finance Minister’s maiden budget is noteworthy for the statement of intent to revive manufacturing and infrastructure sectors while maintaining fiscal discipline. The clarity of thought in this regard and the statement that manufacturing revival is essential for job creation is heartening.’
‘ I think Jaitley has presented a realistic budget under difficult circumstances and put in place the basic building blocks for economic recovery along with fiscal consolidation. The support provided to various sectors and, particularly, the threshold for investment allowance being brought down to Rs 25 crores, is welcome. Equally, linking MGNERGA to rural infrastructure and asset creation is a significant step. While the emphasis on streamlining tax administration along with providing a stable tax regime will boost confidence and attract investment, increase in personal income tax exemption and enhancement of investment limit will provide a boost.’
Describing the Central Budget as ‘progressive’, Rajiv Mohan, MD of Cherry Hill Interiors Ltd specialising in LEED-certified projects, pointed out, ‘On a macro and micro level, the Budget appears positive and prudent. Specifically, I welcome Finance Minister’s statements that GST has been debated enough and now needs implementation. The Finance Minister went into the details and duly understood Industry needs around reforms in tax structure, keeping fiscal deficit under control, improving measures around manufacturing and taking steps to attracting foreign direct investments into India. We strongly welcome steps to bring predictability and certainty regarding taxation policy at-large. The intent of the Budget to offer benefits to wider-audience is also welcome. Overall a progressive budget and we strongly welcome the intent, measures, directions and road-map.’
The real estate sector has welcomed the budget. Mohit Goel, CEO with Omaxe Ltd, noted, ‘I welcome the overall Budget and the government’s endeavor to create an outline for reviving all sectors. A growing economy will in turn boost the real estate sector also. The Union Budget’s positive initiatives to revive the sector like relaxation in FDI, REITs and allocation of Rs 7,060 crore for 100 smart cities development are commendable. Incentives for affordable housing, raising tax exemption limit and interest reduction in home loan will bring further momentum to the sector. Promotion of industrial development and growth of manufacturing sector will give a boost to tier II and III cities, lead to improvement in urban infrastructure and create more avenues for employment, income and lifestyle improvement. In short, the government has set up the broad framework on which to build the structure of its vision ‘‘Housing for All’’ by 2022.’
Congratulating the FM for his positive Budget, Prashant Solomon, MD of Chintels India and Memberof theCREDAI-NCR Governing Council, said, ‘I congratulate the Finance Minister on a positive union budget. With various announcements for the realty sector regarding development of smart cities and industrial towns, the budget will boost the growth of the sector. REITs will ensure easy flow of FDI and raising funds for developers. Special announcement for SEZ and tax rebate on housing loans will increase investments. I hope that the economy on the whole gets a positive boost, post this budget, which in turn will aid housing sector by escalating demand for quality housing.’
The education sector has expressed delight with the Budget. Sanjeeva Shivesh, CEO and Founder of The Entrepreneurship School (TES), said, ‘This Budget is comprehensive and has touched most of the sectors and segments of the economy. The Entrepreneurship School is delighted with the FM’s announcement to allocate Rs 10000 for start-up fund. Providing risk capital to startups was long overdue and this initiative has the potential to kick-start entrepreneurial revolution in India.’
C P Krishnan, Whole Time Director of Geojit Comtrade Ltd, noted that the Union Budget has proposed a slew of measures to support the agriculture sector and to boost growth amid a possible weak monsoon. ‘The plan to allot fund for NABARD for long term rural credit fund, proposal to conduct open market sale to control grain stocks and forming a 2000 producers’ organisation possibly assist the agriculture sector on a long term basis. Proposals of farm stabilization fund, soil testing labs across the country and the plan for allocating 50 billion rupees for farm warehousing plan are the other major moves to stabilize the agriculture sector.’
Surabhi Arora, Associate Director (Research) with Colliers International, said ‘The FM with the pretext of development of smart cities has proposed changes in FDI for real estate sector. The reduction in built up area from 50000 sq mtr to 20,000 sq. mtr, and minimum capitalization from 10 million to 5 million is definitely a positive move for real estate sector. The reduction in built-up area and size of projects will allow mid-sized and smaller developers with good track records better access to FDI and boost affordable housing in the country.’ Hemal Doshi, Chief Currency Strategist with Geojit Comtrade Ltd, said that the Union Budget 2014 ‘fell short of high expectation but a step has been taken in a right direction which is required for the economic growth and job creation. Many areas which were facing obstacle and were crucial for a turnaround in the economy have been addressed’. Sanjay Kaul, MD & CEO of NCML, said ‘The expectation that there would be a special thrust to the agriculture and food sectors in the Budget has been belied. There has also been no policy shift to signal greater engagement of the private sector and attract investment in this vital sector. It is also surprising that the Finance Minister did not announce any short term measures to tackle food inflation. It had been expected that there would be immediate intervention on the supply side by announcing release of grains in the open market and import of pulses and edible oils to soften prices. The determination to deal with spiralling prices does not appear to have been a priority for the government. However, the marginal reduction in excise duties in the food processing sector and extension of the Nabard RIDF loan scheme for warehousing infrastructure is welcome. The announcement of engaging with States for opening private agricultural markets, restructuring of the FCI, and moving towards a National market are also welcome steps.’
Sidharth Birla, President, Ficci, said, ‘Through this Budget the Finance Minister has set the ground for repair of the economy. There has been a mix of both short term and long term measures geared towards boosting confidence of all key constituents. The Finance Minister presented the budget in a very difficult situation and what we have is a set of progressive announcements that will be the key building blocks for engineering a turnaround in the growth trajectory over the next two to three years.’
‘With the view to give a boost to capital formation, government has lowered the eligibility limit for investments to get the benefit of investment allowance from Rs 100 crore to Rs. 25 crore. This will give encouragement to the SME sector that is a key contributor to employment generation. Further, the announcement to enhance the composite cap of foreign investments in defence and insurance sector will send a strong message to the global investor community,’ Birla added.
‘The budget also contains further measures to tackle food inflation in the form of establishment of a Price Stabilisation Fund and a commitment by Centre to work closely with states to re-orient their respective APMCs to provide for establishment of private market yards/ private markets.
Shyam Srinivasan, Managing Director & CEO, Federal Bank, said ‘This is the first budget from the Finance Minister, after the Government got a clear mandate and we are just months away from the second budget of the new Government. I would view this as a good beginning. The budget broadly met expectations by reassuring that the Government would not amend tax rules retrospectively — even though it is a Sovereign right — and has assured that GST would be introduced during the course of the year.’
‘Given the constraints that the government was facing, the budget was as we expected with good news coming in for the Infrastructure sector, more importantly the power and roads segment,’ said D.C Jain, MD & CEO, IDBI Capital. The increase in disposable income and the incentive for savings is a positive. Job creation and skill development seemed to be the underlying principles behind a lot of the moves and manufacturing will see some traction on the back of the proposals in the Budget.’
Vishwas Utagi, General Secretary, Maharashtra State Bank Employees Federation (MSBEF) and Vice President, All India Bank Employees Association (AIBEA), sounded the alarm when he stated, ‘Financial Sector Unions shall repulse the attack of private capital to highjack banking and insurance sector as reflected in central budget. 49 per cent FDI in insurance and clearance of pending insurance reforms bill will be the beginning of privatization of LIC and the four Public Insurance companies in India. The Jewel of India that is Life Insurance Corporation will be fully exploited by the corporates.’
The automobile sector was cautiously optimistic about the Budget. ‘The Finance Minister has delivered a well-defined and prudent budget with specific focus on infrastructure, manufacturing and rural schemes,’ noted Dr Pawan Goenka, Executive Director, Mahindra & Mahindra Ltd. ‘To view it in the macroeconomic perspective, it has laid clear emphasis on supporting investment. Though there were no big bang announcements, the intent of the budget is clear. In fact, I see this budget as a blueprint to the direction the government will take over the next nine months.’
‘The Budget 2014 is based on fiscal prudence with a progressive outlook,’ said Kenichiro Yomura, President of Nissan India Operations. ‘We appreciate his considerations and his aim to achieve 7-8 per cent GDP in 3 to 4 years. Structural reforms, including FDI liberalisation in defense and insurance, initiatives to support local manufacturing and commitment to remove retrospective taxation, are significant steps from a larger macro-economic perspective.’
A. Ramasubramanian, President, AMW Motors Ltd, said, ‘The measures for development of infrastructure development like highways, industrial corridors, housing, manufacturing, FDI in defence sector and power projects, are welcome and will contribute to demand generation for commercial vehicles, which have seen record lows in recent years. The Finance Minister’s announcement for tax holidays for infra projects with long gestation periods will encourage more entrants into the sector. The budget has attempted to address issues in several sectors of the economy, but industry will pin its hope on implementation, which has been an issue in the past.’
R N Rao, Director (Sales & Marketing) with AMW Motors Ltd said, ‘The speeding up of highway projects and development of 8,000 km of roads will give a boost to M & HCVs as also the measures announced in the power and housing sectors. Excise concessions for the automobile industry are being continued and recent trends in the commercial vehicle sector give us cause for cautious optimism. The recovery of the industry is closely linked to so many infrastructure and consumer sectors that it will be some time before an uptick in demand is continuous and healthy. However, the budget has sent positive signals for our sector.’
Ravi Uppal, MD & Group CEO of Jindal Steel and Power Ltd, highlighted the Jaitley budget as a positive and cheerful one. ‘On the whole, the budget is very positive. It is one of the most comprehensive budget presentations that I have ever witnessed, covering the entire socio-economic breadth of the country. Point by point, the Finance Minister recalled the promises made in its manifesto across all sectors and talked about how the government wishes to deliver on them. It covered everything: rural development, skill sets, infrastructure, sports, airports, waterways, navigation, power generation et al.’ ‘The budget brought good cheer for the power sector on two counts – first, power units that get commissioned by 31 March, 2015 will be assured of continuous coal supply and second, the extension of the tax holiday for power projects till 31 March, 2017, a necessary step given the number of power projects stranded for want of fuel or environment clearances. The extension will also renew the viability of the proposed projects.’
The budget also drew a reaction on REITs and FDI in real estate sector. Mike Holland, CEO of Embassy Office Parks, expressed happiness with the measures taken by Finance Minister Arun Jaitly for reviving the Real Estate sector. ‘It is absolutely appropriate that the government has taken up measures on the two fronts (FDI and REIT taxation provisions) which should both have a much needed positive medium term impact on the sector. The government intends to provide necessary incentives for the introduction of real estate investment trusts (REITs) in the country and will also enable REITs with a tax pass-through status to avoid double taxation. The various clarifications on tax pass through and Capital Gains Tax (CGT) are welcome and this creates a level playing field between REIT’s and other forms of indirect investment in the real estate sector e.g. equities in listed real estate entities. We look forward to seeing the details of the draft regulations but the overall sentiment is certainly quiet positive.’
In the hospitality sector, Vikas Chadha, CFO of Berggruen Hotels, described the Central Budget as ‘neutral’ in terms of the investment incentives into the hospitality sector. ‘We were hoping for some positive declarations for hospitality industry and incentives, as the sector is currently under pressure with lower revenue and high cost of debt. GST implementation by end of the year as envisaged in the budget needs to happen urgently so that it streamlines the indirect taxes, this will be relevant for us as we have Hotels Pan India in multiple states. This would ease the compliance and execution aspect on Taxes. On the direct taxes , we hope that the increase in limits both 80 C and basic exemption limits would help increase the disposable income in the hand of end customers, this could give rise to increased spend on travel and tourism which could benefit Hotel companies like Keys.’
This feeling was echoed by a Goan hotelier Edwin Fonseca of the heritage Astoria Resort. ‘Overall, the Central Budget is a good one and we should appreciate the Modi Government for it. It is a positive and welcoming budget which ensures that the middle class can travel comfortably. Also, it is nice that the government removed the 14.7% per cent tax on railways hike, while taxing luxury items like tobacco and soft drinks, and avoiding touching common food items and gold which is already on a high.’
The engineering sector too is positive about the Budget. Pradeep Bavadekar, MD, MITCON Consultancy & Engg. Services Ltd, Pune, noted: ‘In my opinion, by and large it is a good budget which is clearly aiming at reviving Indian economy through infrastructure development —leading India to be an investor-friendly destination. Less tax burden on common man for uplift of economy and more circulation of funds through increasing investment limits is a USP of this budget. The government has taken good steps for industrial and infrastructural development like creation of new textile clusters, 100 smart cities, new industrial clusters and biotech clusters.’
‘The agriculture sector, which is the backbone of the Indian Economy, will get a boost by increasing warehousing capacity in the country and also by allocating funds for separate agriculture infrastructure fund. The Government also has given more allocation to MSME sector of Rs 10,000 crore through venture capital fund which will be an encouragement for entrepreneurs.’ Subhrakant Panda, MD of Indian Metals and Ferro Alloys Ltd (IMFA), said, ‘The Finance Minister’s maiden budget is noteworthy for the statement of intent to revive manufacturing and infrastructure sectors while maintaining fiscal discipline. The clarity of thought in this regard and the statement that manufacturing revival is essential for job creation is heartening.’
‘ I think Jaitley has presented a realistic budget under difficult circumstances and put in place the basic building blocks for economic recovery along with fiscal consolidation. The support provided to various sectors and, particularly, the threshold for investment allowance being brought down to Rs 25 crores, is welcome. Equally, linking MGNERGA to rural infrastructure and asset creation is a significant step. While the emphasis on streamlining tax administration along with providing a stable tax regime will boost confidence and attract investment, increase in personal income tax exemption and enhancement of investment limit will provide a boost.’
Describing the Central Budget as ‘progressive’, Rajiv Mohan, MD of Cherry Hill Interiors Ltd specialising in LEED-certified projects, pointed out, ‘On a macro and micro level, the Budget appears positive and prudent. Specifically, I welcome Finance Minister’s statements that GST has been debated enough and now needs implementation. The Finance Minister went into the details and duly understood Industry needs around reforms in tax structure, keeping fiscal deficit under control, improving measures around manufacturing and taking steps to attracting foreign direct investments into India. We strongly welcome steps to bring predictability and certainty regarding taxation policy at-large. The intent of the Budget to offer benefits to wider-audience is also welcome. Overall a progressive budget and we strongly welcome the intent, measures, directions and road-map.’
The real estate sector has welcomed the budget. Mohit Goel, CEO with Omaxe Ltd, noted, ‘I welcome the overall Budget and the government’s endeavor to create an outline for reviving all sectors. A growing economy will in turn boost the real estate sector also. The Union Budget’s positive initiatives to revive the sector like relaxation in FDI, REITs and allocation of Rs 7,060 crore for 100 smart cities development are commendable. Incentives for affordable housing, raising tax exemption limit and interest reduction in home loan will bring further momentum to the sector. Promotion of industrial development and growth of manufacturing sector will give a boost to tier II and III cities, lead to improvement in urban infrastructure and create more avenues for employment, income and lifestyle improvement. In short, the government has set up the broad framework on which to build the structure of its vision ‘‘Housing for All’’ by 2022.’
Congratulating the FM for his positive Budget, Prashant Solomon, MD of Chintels India and Memberof theCREDAI-NCR Governing Council, said, ‘I congratulate the Finance Minister on a positive union budget. With various announcements for the realty sector regarding development of smart cities and industrial towns, the budget will boost the growth of the sector. REITs will ensure easy flow of FDI and raising funds for developers. Special announcement for SEZ and tax rebate on housing loans will increase investments. I hope that the economy on the whole gets a positive boost, post this budget, which in turn will aid housing sector by escalating demand for quality housing.’
The education sector has expressed delight with the Budget. Sanjeeva Shivesh, CEO and Founder of The Entrepreneurship School (TES), said, ‘This Budget is comprehensive and has touched most of the sectors and segments of the economy. The Entrepreneurship School is delighted with the FM’s announcement to allocate Rs 10000 for start-up fund. Providing risk capital to startups was long overdue and this initiative has the potential to kick-start entrepreneurial revolution in India.’
C P Krishnan, Whole Time Director of Geojit Comtrade Ltd, noted that the Union Budget has proposed a slew of measures to support the agriculture sector and to boost growth amid a possible weak monsoon. ‘The plan to allot fund for NABARD for long term rural credit fund, proposal to conduct open market sale to control grain stocks and forming a 2000 producers’ organisation possibly assist the agriculture sector on a long term basis. Proposals of farm stabilization fund, soil testing labs across the country and the plan for allocating 50 billion rupees for farm warehousing plan are the other major moves to stabilize the agriculture sector.’
Surabhi Arora, Associate Director (Research) with Colliers International, said ‘The FM with the pretext of development of smart cities has proposed changes in FDI for real estate sector. The reduction in built up area from 50000 sq mtr to 20,000 sq. mtr, and minimum capitalization from 10 million to 5 million is definitely a positive move for real estate sector. The reduction in built-up area and size of projects will allow mid-sized and smaller developers with good track records better access to FDI and boost affordable housing in the country.’ Hemal Doshi, Chief Currency Strategist with Geojit Comtrade Ltd, said that the Union Budget 2014 ‘fell short of high expectation but a step has been taken in a right direction which is required for the economic growth and job creation. Many areas which were facing obstacle and were crucial for a turnaround in the economy have been addressed’. Sanjay Kaul, MD & CEO of NCML, said ‘The expectation that there would be a special thrust to the agriculture and food sectors in the Budget has been belied. There has also been no policy shift to signal greater engagement of the private sector and attract investment in this vital sector. It is also surprising that the Finance Minister did not announce any short term measures to tackle food inflation. It had been expected that there would be immediate intervention on the supply side by announcing release of grains in the open market and import of pulses and edible oils to soften prices. The determination to deal with spiralling prices does not appear to have been a priority for the government. However, the marginal reduction in excise duties in the food processing sector and extension of the Nabard RIDF loan scheme for warehousing infrastructure is welcome. The announcement of engaging with States for opening private agricultural markets, restructuring of the FCI, and moving towards a National market are also welcome steps.’
Sidharth Birla, President, Ficci, said, ‘Through this Budget the Finance Minister has set the ground for repair of the economy. There has been a mix of both short term and long term measures geared towards boosting confidence of all key constituents. The Finance Minister presented the budget in a very difficult situation and what we have is a set of progressive announcements that will be the key building blocks for engineering a turnaround in the growth trajectory over the next two to three years.’
‘With the view to give a boost to capital formation, government has lowered the eligibility limit for investments to get the benefit of investment allowance from Rs 100 crore to Rs. 25 crore. This will give encouragement to the SME sector that is a key contributor to employment generation. Further, the announcement to enhance the composite cap of foreign investments in defence and insurance sector will send a strong message to the global investor community,’ Birla added.
‘The budget also contains further measures to tackle food inflation in the form of establishment of a Price Stabilisation Fund and a commitment by Centre to work closely with states to re-orient their respective APMCs to provide for establishment of private market yards/ private markets.
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