Reactions on Budget 2010 By Kishor P. Ostwal, CMD, CNI Research Ltd
"The budget has dealt with the key concerns such as fiscal deficit, inflation growth and reforms simultaneously. It is pro infrastructure growth and full of scope for inclusive growth. The tax limit hikes are substantial which will put more money in the hands of salaried and small businessman, this is positive for FMCG and Consumer durable sector. This has recognised India's need of inflow of over 1 trillion usd for taking the infrastructure to world class levels without falling prey to the pitfalls of global economies. Containing market borrowing at Rs 345000 crs is extremely difficult in given circumstances which the Hon'ble FM has done. Fiscal deficit of 5.5% especially looks very good in light of the fact that the market borrowings are restricted at Rs 345000 crs. Also the road to capital convertibility is seen progressing as major capital control on royalty payments was removed and FDI has been made more trans parent.
The Finance Minister has done a reasonable job exhibiting the stand of the GOI clearly after keeping in mind the limited options available to him. The other worries such as tinkering of long term capital gains tax and full rollback of stimulus did not happen which is again positive for the market. The budget has been announced keeping the concerns of the market and the FPO of over 3 bn usd lined up on 10th of March 2010 which is just 7 trading sessions after budget.
This budget is the first signal to the world that the sleeping elephant is ready to roar. Talking of 9 to 10 % GDP growth in 2 years is by no means a small achievement. This augurs well for long term investors as it gives comfort to the investors that India is ready to deal with any global crisis such as sovereign debt crisis by any European countries." |
Union Budget