[vc_row][vc_column width="1/1"][vc_column_text]Finance Minister Arun Jaitley has at last presented the Union Budget 2016 and while the budget holds promise, we decided it's better if the experts weigh in with their views on whether they think Jaitley delivered or not-
FY17 Budget has provided a strong growth direction to the Indian economy. The Finance Minister has managed to balance the need to prioritize social sector requirements with economic and business imperatives. The segmented 9-Pillar Approach with well carved out deliverables will ensure execution clarity and focus. By adhering to fiscal deficit aim of 3.5% the Budget creates room for complimentary monetary policy rate cut of 50 bps in the near term and 75-100 bps in 2016, conditioned on favorably evolving macros. Key measure to increase the allocation to infrastructure with an impressive outlay of INR 2.2 lakh crore will help to re-energize the growth multiplier, while the specific measures to improve ease of doing business and favorable tax treatment for start-ups and MSMEs will go a long way in boosting job creation.
-Mr. Rana Kapoor, and MD & CEO, YES BANK
In the backdrop of a challenging global economic environment, we believe the Finance Minister’s main focus has been to reiterate India’s commitment to stable economic and fiscal policies. Foreign investors are likely to derive significant confidence from the fact that the fiscal deficit is likely to be reigned in at 3.5%, and that India’s growth is not dependent on short-sighted fiscal over-spending. The restrained budget also means that interest rates are likely to come down further in the coming weeks. Moreover, market worries regarding long-term capital gains tax proved unfounded too. The government’s focus on plan expenditure and infrastructure continued, as evidenced by the significant increase expected in irrigation coverage acreage, as well as focus on roads and ports. Overall, the budget accommodates Pay Commission requirements and higher plan expenditure, without breaching the deficit and achieves this with credible numbers, which would be the key positive highlights.
-Mr. Dinesh Thakkar, CMD – Angel Broking
The Union Budget is a positive policy statement from the government with the potential for long-term transformational effect in the Indian economy. The Hon’ble Finance Minister announced the introduction of new derivative products, which is a welcome move for the commodity stakeholders. We are hopeful that SEBI, during FY 2016-17, will allow products such as options and trading in indices and intangibles, which will enhance the breadth and depth of the commodity market. Further, the enhancement of investment limit from 5 to 15 per cent for foreign entities in Indian stock exchanges is yet another encouraging development, which would help boost the global competitiveness of Indian stock exchanges. By exempting transactions in IFSCs from Dividend Distribution Tax, Capital Gains Tax, and Commodity/ Security Transaction Tax, the government has taken a positive step in incentivizing trading at these platforms. However, we are disappointed that the government has not acceded to our long pending request for reduction, if not the elimination, of Commodity Transaction Tax (CTT), which has seen a drop in hedging interest in domestic commodity futures exchanges due to increase in impact cost, and has resulted in shifting of volumes to international exchanges in countries such as Dubai.
-Mr. P. K. Singhal. Joint Managing Director, MCX
From market point of view, it may have neutral impact on market because there are not too many negative announcements and positive announcements as Finance Minister has put more focus on Rural, Agriculture & Infrastructure development. Fiscal Deficit Target for FY17 remain unchanged at 3.5%, which is highly positive for the market, also planned expenditure increased by 15.3 % to 5.5 lac Crores because of these expectations have built up for rate cut by RBI governor in coming days. Finance Minister proposed outlay of Rs. 2,18,000 cr for railways, roads in 2017 and NHAI to raise Rs. 15000 cr via bonds in 2017 which will be positive for bond markets as well. Budget brings relief for small tax payers through ceiling of tax rebate increased by Rs. 3,000, Tax rebate on rent paid upped to 60,000 rupees vs 24,000 rupees, Some home buyers to get extra exemption of 50,000 rupee per year. Withdrawal up-to 40% from National Pension plan to be tax exempt at retirement. Focusing on sectors like Insurance, Health, Fertilisers, Infrastructure. Above mentioned sector will remain in focus giving more emphasis on Rural, Agriculture & infrastructure development. Investors can add the mid-cap stocks from specific sectors like – fertilisers, construction, education etc. in their portfolio which could have positive impact on them, looking at the current budget allocation for these sectors. Nifty will remain in a range of 6,800 to 7,200.
-Mr. Rohit Gadia, Founder & CEO, CapitalVia Global Research Ltd
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