| Sensex reacts positively to inclusive Budget
|
By C Jayanthi
The sensex reacted positively and was up points after the Budget
was announced, despite the Opposition in Parliament having issues
with it to which the Union Finance Minister, Mr Pranab Mukherjee,
had to remind them that he had a “Constitutional right”
to complete his speech.
In terms of taxation, there is 25 per cent tax savings for people
who are earning upto Rs 1 lakh per month. The service tax remains
unchanged at 10 per cent, and on-line news agencies will attract
tax once the Finance Bill is passed. Agri-production as usual attracts
benefits. The Budget gives strong focus to boost agri-production,
and the Rashtriya Krishi Vikas Yojana shall get Rs 300 crore. The
repayment of loans to be extended to six months in drought and flood-hit
areas.
The ASSOCHAM president Dr. Swati Piramal, while welcoming Budget
proposals, termed them as Pragmatic, positive, growth and development
oriented as these aim at attaining inclusive growth. “The
Finance Minister has performed the most balancing act under given
circumstances by partially rolling out the Stimulus package and
at the same time paid adequate attention for development of social
sector and more specifically so for rural sector,” she said.
The failure in agriculture has been compensated by good performance
in the manufacturing sector growth which has been the highest in
two decades. The social sector spending is up to Rs 1. 37 lakh crore.
The Budget tries to bring down the fiscal deficit substantially
to around 4.1% in next two years. Also the government’s effort
to reduce its borrowing programmed to Rs.3.45 lakh core this year
from Rs.4.6 lakh crore would contribute substantially to this effort.
The disinvestment target of Rs.40, 000 crore would add substantially
towards reducing the deficit and bring in better fiscal prudence.
The change in the tax slabs would lead to generation of additional
funds. These funds which will get into the hands of Indian middle
class, would lead to higher consumption, savings and investments
simultaneously.
The PHD Chamber president, Mr Ashok Kajaria, said that this was
a positive Budget for the industry with no surprises in it. The
provisions go a long way to reflect the government’s commitment
to satisfying the aspirations of the “aam aadmi” through
social sector programmes even while striving to revive growth in
the economy and addressing the problem of fiscal deficit. The Budget
is a move forward on the path of fiscal prudence with focus on the
infrastructure investment in order to continue with the growth momentum.
The government’s continued focus on the infrastructure
investment (Rs.1.73 lakh crore) under various schemes like Bharat
Nirman would lead to a broad-based growth with grater dispersal
of money across the levels to have an inclusive growth.
The Budget tries to bring down the fiscal deficit substantially
to around 4.1 per cent in next two years. Also the government’s
effort to reduce its borrowing programme to Rs.3.45 lakh crore this
year from Rs.4.6 lakh crore would contribute substantially to this
effort. The disinvestment target of Rs 40,000 crore would add substantially
towards reducing the deficit and bring in better fiscal prudence.
Among the key features of the Budget are: to quickly revert to the
high GDP growth path of 9 per cent and then find the means to cross
the ‘double digit growth barrier’ like China already
has. To harness economic growth to consolidate the recent gains
in making development more inclusive. To address the weaknesses
in government systems, structures and institutions at different
levels of governance.
India is among the first few countries in the world to implement
a broad-based counter-cyclic policy package to respond to the negative
fallout of the global slowdown. |
