nishka budget

8/12/2019 Nishka Budget

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Rebuilding Growth

Neha Mishra & Ankit Pandey, F2

The Union Budget presented on 10 July

2014 by the finance minister, Mr Arun Jaitley

looks promising with renewed focus on investment

and fiscal consolidation, clearly being the underly-

ing theme in this budget. A persistent uncertainty

in the global arena and high inflationary pressure

has compelled the government to address issues

pertaining to structural constraints that continues to

pose challenges in growth of the country. The

agenda for the new government was to make ade-

quate investment, which was quintessential to facil-

itate a surge in jobs and income. The roadmap forreduced fiscal deficit in the next three years is in-

spiring at 4.1% of GDP for 2014-15, 3.6% in 2015-

16 and 3% in 2016-17.

MSME Sector

Finance minister Mr Arun Jaitley an-

nounced measures for development of Micro,

Small and Medium Enterprises (MSMEs) by allo-

cating a sum of Rs. 10,000 Crores for start-up com-

panies. This has been proposed with a view to at-

tract private capital in the start-up domain in India.

Other measures that have a bearing on MSMEs

are a provision of Rs. 100 Crores for start-up vil-

lage entrepreneurship involving the rural popula-

tion, and Rs. 200 Crores for scheduled caste entre-

preneurs. The definition of MSME sector is to be

reviewed to provide for a higher capital ceiling. To

look into the matters of the revival of MSMEs and

the financial architecture Mr Jaitley has proposedsetting up of a committee of the Ministries of Fi-

nance and Micro, Small and Medium Enterprises

and the Reserve Bank of India. This has triggered

some comments by industry bodies who feel the

need for setting up of an apex body is not impera-

tive in the light of issues of financing, power sup-

ply and high interest rates.

This is probably the very first time that the

government is thinking about venture capital fund-

ing in the MSME sector. This would definitely in-

duce more private investments by way of equity,

soft loans and other risk capital, encouraging

growth in this sector.

MGNREGA

According to the budget, MGNREGA, the

flagship scheme of the UPA government would be

more productive, asset creating and would be

linked to agriculture and allied activities that wouldinduce wage employment opportunities under this

scheme.

Activists are unhappy about the low allo-

cation under this scheme since they expected the

government to recognize inflation and the high

wage rates in different states of the country while

making the allocation. What remains to be seen is

how the program would service the same number

of people with this budget? Although the view is to

build real assets by paying a minimum wage, what

remains to be seen if people are willing to work

hard and build assets, which we do not see very

clearly in the UPA regime.

FDI

The new government is encouraging easier

flow of FDI in few sectors. Some of the proposals

are:

Composite cap of FDI to be raised in

the Defense sector to 49%.

Composite cap of FDI in Insurance sec-

tor rose from 26% to 49% with full In-

dian management and control through

FIPB route.

To encourage development of smart

cities which will also provide habita-

tion for the neo-middle class, the Fi-

nance Minister announced that the re-

quirement of the built up area and capi-

tal conditions for FDI is being reduced

from 50,000 Square meter to 20,000


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Square meter and from USD 10 million

to USD 5 million respectively with a

three years post completion lock-in.

The Finance Minister announced that

the manufacturing units would be al-

lowed to sell their products through

retail including e-commerce platforms

without any additional approval. FDI inthe manufacturing sector is today on an

automatic route.

Raising the FDI limit to 49% from 26% in the

Defense manufacturing sector will give a boost to

domestic manufacturing and procurement of De-

fense equipment. It was pragmatic for the govern-

ment to take this step since it would also generate

greater employment.

The insurance sector has been one of the big-gest beneficiaries of the increase in the FDI cap to

49%. The insurance sector of India was investment

starved. Increasing the composite cap of FDI has

smoothened the way for expansion of this sector as

a whole.

The budget of 2014-15 has brought about a

sense of complacency in the minds of people since

they are satisfied with the new governments action

plan and initiatives to be taken regarding employ-ment generation, emphasis on infrastructure, pro-

moting entrepreneurship and curbing inflation.

Financial Sector

Indian Financial Code

The financial sector is the epicenter of the

growth engine and hence it was imperative to

strengthen and modernize the legislative regulatory

framework.

With the need of a stronger legislative regu-

latory framework, Mr. Jaitley in his budget com-

mitted to bringing in a new code to streamline vari-

ous regulations in the financial sector. The Indian

Financial Code (IFC) would lay out clear objec-

tives for financial regulations, and would bring

about better governance and accountability.

Modern Monetary Policy Frame work

The Finance Minister has agreed to devise a

modern monetary policy to meet challenges of an

increasingly complex economy. The modern mone-

tary policy would have its target cut out to curb

inflation.

The RBI Governor, Mr. Raghuram Rajan is

in agreement with the Finance Minister has assured

that the Central Bank would develop the frame-

work in consultation with the government to make

it transparent.

Through the new mechanism, the govern-

ment and the Reserve Bank of India (RBI) look

towards bringing down consumer inflation to 8 per

cent by this year-end with a target rate of inflation

of 4 per cent (with a tolerance band of 2 per cent)

to be achieved in a two-year time-frame.

Smoother KYC Norms

To make capital market access smoother for

investors, the Finance Minister has proposed intro-

duction of uniform Know Your Customer (KYC)

norms and inter-usability of KYC records across

the entire financial sector. The move is a welcom-

ing one for the individual investor who deals with

multiple service providers such as banks, insurance

companies and mutual funds and is currently re-

quired to repeat the KYC documentation with each

one of them.

At present, there are five Know Your client

registration Agencies (KRAs) licensed by SEBI to

undertake the KYC processing.

For the investor, it spells good news, as he

will not have to produce a variety of different doc-

uments in dealing with different financial service

providers. Its implementation and execution is key,

however, it would definitely iron out many wrin-

kles that have become part of the KYC processing.

Banking Sector

Financial Inclusion Mission

With a view to boost Financial Inclusion in

a country where 60 per cent of the population does

not have a bank account, the mission is to be

launched on 15 August this year with its prime fo-cus on the weaker sections of the society.

To ensure feasibility and success of the said


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mission, the Finance Minister has enumerated the

following:

Reiterated the commitment to set up

differentiated banks such as payments

banks for which the Reserve Bank of

India would roll out a framework for

issuing licenses to such banks. A pay-

ments bank license for India Post,

which has a deeper network than In-

dias largest lender State Bank of India,

should help boost financial inclusion by

facilitating banking in the remotest cor-

ners of the country.

Mr. Jaitley proposed to open two bank

accounts for each household in the

country.

The Finance Minister also allowed for

the use of Know Your-Customer

(KYC) records across the financial

such sector such as for banking, stocks,

bonds, mutual funds and insurance, and

proposed a single de-mat account to be

used for investing in stocks, commodi-

ties and insurance.

The above-mentioned moves should go a long

way in improving the penetration of these assetclasses and products. In addition, public sector

banks will be allowed to sell their shares to retail

investors as long as the government shareholding

does not drop below 51 percent. This would lead to

sourcing of funds that can be used to recapitalize

banks and fund their expansion.

Long Term Infrastructure Lending

The

finance ministerproposed to reduce

regulatory requirements of long-term funds raised

for lending to long-term infrastructure projects.

Currently, the funds raised are subject to several

regulatory requirements. This will bring banks at

par with other infrastructure financing companies

in terms of lending to this segment.

As a result, banks' interest spread on these

loans is expected to improve in the future. Howev-

er, the market is yet to receive clarity on the defini-tion of funds that classify as long term and the

quantum of relaxation from requirements such as

CRR, SLR and priority lending for infrastructure

loans.

Debt Recovery Tribunals

To expedite the process to recover bad

loans, the Finance Ministerproposed to set up six

new Debt Recovery Tribunals at Chandigarh, Ben-

galuru, Ernakulum, Dehradun, Siliguri and Hydera-

bad.

The rising Non-Performing Assets (NPAs)

of public sector banks are a matter of concern for

the Government and this will work out as an effec-

tive means for revival of these stressed assets.

According to credit rating agency ICRA,Public Sector Banks' gross Non PerformingLoans (NPLs) increased to Rs. 227,300 Crores as

at March-end 2014 from Rs. 164,500 Crores a yearago. The net non-performing assets ofcommercial

banksconstitute around 4% of the total loan bookfor 2013-14 against 3.6% a year ago.

Keeping in line with the international trends

on helping financial institutions recover their bad

debts quickly and efficiently, the Government of

India constituted 33 Debts Recovery Tribunals and

5 Debts Recovery Appellate Tribunals across the

country. These six additional tribunals will take the

total number of tribunals to 39.

India, with the help of Modi government is

paving the way towards renewed growth. Keeping

in view the proposals of the Union Budget 2014 -

15, it can be said that if the above-mentioned pro-

posals can be implemented it would definitely

solve the long-standing structural problems hurting

the economy at large. What remains to be seen is

how the government implements these steps with a

view to curbing the two-year spell of weak growth

in the economy?
http://economictimes.indiatimes.com/topic/finance%20ministerhttp://economictimes.indiatimes.com/topic/finance%20ministerhttp://economictimes.indiatimes.com/topic/credit%20ratinghttp://economictimes.indiatimes.com/topic/credit%20ratinghttp://economictimes.indiatimes.com/topic/ICRAhttp://economictimes.indiatimes.com/topic/Non%20Performing%20Loanshttp://economictimes.indiatimes.com/topic/Non%20Performing%20Loanshttp://economictimes.indiatimes.com/topic/Non%20Performing%20Loanshttp://economictimes.indiatimes.com/topic/commercial%20bankshttp://economictimes.indiatimes.com/topic/commercial%20bankshttp://economictimes.indiatimes.com/topic/commercial%20bankshttp://economictimes.indiatimes.com/topic/commercial%20bankshttp://economictimes.indiatimes.com/topic/commercial%20bankshttp://economictimes.indiatimes.com/topic/Non%20Performing%20Loanshttp://economictimes.indiatimes.com/topic/Non%20Performing%20Loanshttp://economictimes.indiatimes.com/topic/ICRAhttp://economictimes.indiatimes.com/topic/credit%20ratinghttp://economictimes.indiatimes.com/topic/finance%20minister


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Paving the Road Ahead

Aswathy Edison, F1 & George P. Job, F2

Infrastructure was Mr. Narendra Modis go-

to word in the elections that saw him become the

Prime Minister of India. He, along with the BJP,

provided promises on how they would transform

and improve the existing infrastructure in India.

Emphasis was, as always, on the populist topics of

better roads, trains, airports, fiber optics and sea-

ports in the official election manifesto. Not much

was said about energy, renewable sources and pe-

troleum.

The Union Budget, though softly touched

each sub head, did not dwell much on the roadmap

that the nation hoped would help accelerate the

growth of infrastructure in the nation.

Mr Arun Jaitley, in his speech ensured he

show cased the intent of the government in ad-

dressing the major issues plaguing the nation, but

did little in terms of providing concrete or firm

steps towards the achieving the same.

He had emphasized on Public Private Part-

nership (PPP) model, and had praised the model for

delivering iconic infrastructure successfully.

In his budget speech, Mr. Jaitley proposed

setting up of an institution called 3P India, with a

corpus of Rs. 500 Crores to provide support to ma-

jor PPPs. This renewed interest in PPPs is ex-

pressed for the development of other sectors such

as urban renewal, urban transportation, and real

estate and gas pipelines.

India has emerged as the largest PPP mar-

ket in the world with over 900 projects in various

stages of development. Yet, Mr. Arun Jaitleywarned on the drawbacks of the PPP model, which

is rigid in contractual agreements, lacked sophisti-

cated model of contracting and redress of dispute

mechanisms.

Roads/ Highways

The Union budget 2014 has focused on the

development of road infrastructure to enhance In-

dias connectivity. The finance minister had allo-

cated Rs. 37,880 Crores to the National and High-

ways Authority of India (NHAI) for development

of the nations road network. It also includes an

allocation of Rs. 3000 crore for the North Eastern

region of the country.

Pradhan Mantri Gram Sadak Yojana

(PMGSY) launched under the prime minister-

shipof Shri Atal Bihari Vajpayee will be continued

with an allocation of Rs. 14,389 Crores. It is a na-

tionwide plan under the Ministry of Rural Develop-

ment to provide road connectivity to the uncon-

nected villages. Mr. Arun Jaitley stated that he was

not in favor of the FDI in road sector, and instead,

preferred involvement of Indian contractors, which

would lead to creation of more jobs. The othermeasures were Rs. 100 Crores for the National In-

dustrial Corridor headquartered in Pune to oversee

the creation of industrial corridor and smart cities

being planned in seven places.

Airports

Focus is on the PPP model even for devel-

opment of airports. Mr. Arun Jaitley has proposedschemes for development of airports in Tier 1 and

Tier 2 cities without specifying the quantum of the

budgetary allocation.


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In order to boost tourism in India, E-Visa

facility will be introduced at nine airports. The fa-

cility of Electronic Travel Authorization (e-visa)

will be introduced in a phased manner in the nine

airports, where infrastructure will be put in place

within the next 6 months. An allocation of Rs. 500

Crores has been made for creation of five tourist

circuits with specific themes in the country.

Ports

Mr. Arun Jaitley has introduced 16 new

port projects for 2014, with a focus on connectivi-

ty. India currently has 13 major ports. He also reit-

erated the previous government's plan to spend Rs.

11,635 Crores to develop the Phase I of the outer

harbor project in VO Chidambaranar Port Trust at

Tuticorin.

The finance minister also said special economic

zones would be developed along the major existing

ports of Kandla in Gujarat and Jawaharlal Nehru-

Port Trust in Mumbai.

Inland Navigation

A project on river Ganga called 'Jal Marg

Vikas' (National Waterways-I) will be developed

between Allahabad and Haldia to cover a distance

of 1,620 kilometers, which will enable commercialnavigation of at least 1,500 tons vessels. A sum of

Rs. 4,200 Crores has been set aside for inland navi-

gation.

In the Energy and Renewable Energy segment,

the measures mentioned were:

Rs. 100 Crores is set aside for Ultra-

Modern Super Critical Coal Based

Thermal Power Technology.

Provide adequate quantity of coal but

rationalize coal linkages to optimize

transportation of coal to reduce cost of

generating power.

Rs. 500 Crores Ultra Mega Solar Power

Projects in Rajasthan, Gujarat, Tamil

Nadu, Seemandhara, Telangana and

Ladakh.

Rs. 400 Crores for solar power driven

agricultural pump sets and water pump-

ing stations.

Rs. 100 Crores for one MW solar parks

on the banks of canals and a Green En-

ergy Corridor Project.

The measures on the non-renewable segment

just addresses the immediate issues of coal supply,

which has caused power procurement problems

and the large amount of energy subsidies that, hurt

the finances of the nation.

The measures on the renewable segment are

more positive given the amounts pledged alongwith the reduction of excise, customs duties on raw

materials used in the manufacture of wind operated

turbines and clearly shows the intent of the new

government in encouraging, and attracting invest-

ment in Renewable sources of energy.

This reintroduction could improve investor

sentiments and help the governments effort to re-

duce the dependence on coal/ oil, and make up the

energy deficit.


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Moving to Petrol & Natural Gas segment,

measures mentioned are:

Expediting production and exploitation

of Coal Bed Methane (CBM) reserves.

Additional 15,000kms of pipelines to

complete the gas grid via the PPP

(Public Private Partnership) model.

Reviewing petroleum subsidies.

Possibility of reviving closed/old wells

using modern technology.

Scaling up usage of Piped Natural Gas

(PNG) on a mission mode.

The budget emphasized on reviewing and re-

ducing petroleum subsidies but remained silent on

the details. In addition, the utilization of the exist-

ing and proposed pipelines depends on the availa-

bility of natural gas, which in turn, depends on the

review of domestic gas pricing.

The tax holiday provided, will reduce the burden of

the companies involved in generation.

While the aim to reduce petroleum subsidy is a

positive, there is no clarity on either the timelines

or the specifics on how the Government plans to

achieve this?

In the Energy Space, it is evident and clear that

the government aims to dilute the overreliance by

the nation on crude oil, and reveals its aim of target

driven production of a higher percentage of power,

from renewable or alternate sources.

In the Mining segment, the measures men-

tioned were:

Changes, if required to the Mines and

Mineral Development and Regulation

Act (MMDRA) 1957 are to be intro-

duced to encourage investment in the

mining sector and promote sustainable

mining practices.

The step aims at removing hurdles to mining in

the country by amending the MMRDA1957. There

is also an intention to revise royalty rates upwards,

which would help States that engage in mining ac-

tivities in a major way.

Overall, the new government has in a shortspan of 45 days since take over has set out the di-

rectional agenda. The key is speedy and effective

implementation, which will put India on the growth

trajectory so badly needed.


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Growth the Fiscal Deficit

Krishnendu Kundu & Niken Jain, F2

Mr Jaitley gave a hint of the Budget being

the one towards Fiscal consolidation and not

Mindless Populism, which the UPA (I & II) gov-

ernment has been practicing over a period. His

view is that Mindless Populism did not help UPA

win the elections; it is an either/or between

Mindless Populism and the economy.

The situation is indeed challenging due to the

sub-five percent growth and high inflation rates.

Added to this are the problems faced by other

countries, which has the potential of derailing weak

sign of global recovery seen recently.

This budget indeed focuses on fiscal consoli-

dation, as it aims to bring the economy back on the

growth trajectory. The Budget focuses on improv-

ing the Tax to GDP Ratio and increasing the non-

tax revenues. The previous government tried and

reduced the Fiscal Deficit by way of reducing ex-

penditures and not working on the revenues side,

but the current budget aims at realization of higher

revenues.

The NDA government supports the Retro-

spective Tax Amendment stating it as a Sovereign

right of the government, but advised exercising it

with utmost caution and judiciousness keeping in

mind the impact of each such measure on the econ-

omy and the overall investment climate. He also

proposed setting up of a high-level committee to

look at new cases arising out of the retrospective

tax amendment.

While this space is keenly followed globally,

post the Vodafone case, and the Government

stance does not satisfy all, losing out on legitimate

tax revenues at this stage is tenable, and therefore,

the Government stance in a way is in order.

The government will undertake a few legisla-tive and administrative changes that would helpsorting out pending tax demands of more than Rs.4 lakh Crores under dispute and litigation. Residenttaxpayers would now be able to obtain Advanced

Ruling in respect of their income-tax liability

above a defined threshold hitherto restricted to for-eign entities and non-residents.

The government would also take measures tostrengthen the current Advanced Rulings mecha-nism. The subsidy regime will be targeted for full

protection to the marginalized, poor and SC/ST.

The Union government will work very close-

ly with the State governments to try to implement

the GST latest by this year-end. This would be

helpful for the taxpayers and increase their confi-

dence in the government.

The government will also form an Expendi-

ture Management Commission that will look into

expenditure reforms, which would help in bringing

down, to an extent, the Revenue & Fiscal Deficits.

A sustainable growth of 4% is targeted in the

Agriculture sector on which around 60% of the

population depends for their livelihoods.

Non-Plan expenditure stands at Rs. 12 lakh

Crores, with an additional provision for fertilizer

subsidies, and investment in Defense. Plan ex-

penditure stands at Rs.. 5.75 lakh Crores, an in-

crease of 26.9% over actuals of 2013-14 that is tar-

geted at Agriculture, Health & Education, Infra-

structure, Energy and Water resources.

The government has given tax relief to indi-

vidual taxpayers by the basic raising exemption

limit by Rs. 50,000 from the current Rs. 2 Lakhs to

Rs. 2.5 Lakhs for individuals below the age of 60

Particulars Amount (in Rs.Crores)

Total Expenditure

17,94,892

Gross Tax Receipts(State & Centre)

13,64,524

Net Tax Receipts(Centre)

9,77,258

Fiscal Deficit

4.1% of GDP

Revenue Deficit

2.9% of GDP


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years, and Rs. 2.5 Lakhs to Rs.3 Lakhs in the case

of the senior citizens. This would help individuals

save Rs. 5,000 on their tax liability.

To promote Savings & Investment, govern-

ment has proposed to raise the investment limit un-

der Section 80C of the IT Act from Rs. 1 Lakh to

Rs. 1.5 Lakhs.

Given high inflation and higher interest rates,

the government has proposed to raise the deduction

limit on loan interest with respect to self-occupied

house property from Rs. 1.5 Lakhs to Rs. 2 Lakh.

Investment allowance at the rate of 15 % to

any manufacturing company (MSME) that invests

more than Rs. 25 Crores in any year in new plant

and machinery. The Capital Goods sector can ben-

efit from this decision, as they can save 15% on

their tax liabilities, and that makes a good deal of

money for MSME sector. The benefit is to be

available for three years i.e. for investments up to

31.03.2017. This would have a multiplier effect on

the economy and would help in the growth of the

economy as well as the employment scenario.

That the government is firmly committed to

the growth of the nation at the cost of lower tax

revenues, can also be seen in the decision to give a

10 year tax holiday to the power companies whobegin generation, transmission and distribution of

power before April, 2017.

To enhance investors confidence and foreign

currency transactions, the government has allowed

the income arising from the foreign portfolio inves-

tors from transaction in securities to be treated as

capital gains irrespective of the number of transac-

tions.

The net effect of the direct tax proposalswould result in a loss of Rs. 22,000 Crores to the

Exchequer.

Indirect taxes:India is majorly an import-oriented economy

with almost everything imported from other na-

tions. The government has realized the benefit of

indigenous production of goods and services, and

hence the focus on improving the domestic eco-

nomic scenario.

However, the recent budget presented by the

Honorable Finance Minister of India, Mr Arun Jait-

ley majorly aims at the long-term growth of the

nations economy, very few industry expectations

have been met with respect to the indirect taxes

levied currently.

To boost the domestic manufacturing sector

like electronics, computer hardware, steel, textiles,

renewable energy, food processing and petroleum,

the budget proposes to reduce the Basic Customs

Duty (BCD). It is may be widely implied that the

new Modified government wants every Saans,

Bahu and Yuva to have access to basic television

broadcast and keep themselves updated. In order to

achieve this, Mr Jaitley has made the Cathode ray

Tube based Television sets cheaper and more af-

fordable to the lower earning section of our society

by exempting the device from BCD.

The sop was not only on the age old out of

fashion CRT TVs but also on the modern LCD and

LED panel televisions. LCD and LED TVs having

a screen size below 19inches are exempt from

BCD. In order to promote the chemical and petro-

chemical industry, basic custom duty has been re-

duced from 10% to 2.5% on formats. The BCD has

also been reduced to 2.5% for items that are re-

quired to make soap and detergents. Hence, cos-

metics, soaps and certain pharmaceutical products

will get cheaper.

In addition to the above-mentioned items,

certain apparels such as gloves, hosiery, jeans andswimsuits may get cheaper due to the reduction in

the custom duty on components required for manu-

facture of spandex yarn from 5% to nil. To increase


10/12

the penetration of telecom and increase the tele-

density (Number of mobile users per unit area)

across the nation, mobile SIM cards are set to get

cheaper with a 4% exemption on SAD (Special

Additional Duty) on the PVC sheet and ribbon

used for the manufacture of those cards. Uncut pre-

cious and semi-precious stones are fully exempt

from customs duty. As a measure to promote thefootwear industry, the excise duty has been re-

duced from 12% to 6% on footwear priced between

Rs. 500 to Rs. 1,000.

In this power deficit sunny country, Sun is

the best renewable resource of energy. Neverthe-

less, solar panels being expensive are not afforda-

ble, generally, by the common public, which re-

sults in lack of demanders. Exemption has also

been provided for EVA sheets and solar blacksheets, tempered glasses and copper wire required

for the manufacture of PV ribbons used in the man-

ufacture of these panels.

In order to build beautiful roads and keep his

dream of connecting all India through industrial

corridors for which a major amount of money has

been allotted, he made the import on road construc-

tion machinery duty free. He also reduced the BCD

on coal tar pitch from 10% to 5%. The FM has also

clarified that aircraft engines and parts thereof are

exempt fully either for service, repairs or mainte-

nance of aircrafts required for scheduled opera-

tions.

India is rich in bauxite, but this mineral is

majorly exported without making appropriate use

of it in the manufacturing sector. The export duty

on bauxite has been increased from 10% to 20%.

The Modi Sarkar seems to working hard to

keep their promise of Achhe Din Aane Wale

Hain by exercising heavy excise duty on ciga-

rettes, tobacco products and aerated drinks. These

are health hazardous intakes and hence with a price

increase may help the victims to quit consuming

these, as continued consumption will surely pinch

their pockets.

The BCD on imported flat steel products

have been increased from 5% to 7.5% make them

expensive.

The tech-savvy PM and his team have expe-

rienced the influence of advertising on various me-

dia. To ensure that no one else enjoy the same ben-

efit, they levied service tax on any advertisement

on the online space, billboards, buildings, commer-

cial publications, cell phone applications or ATMs

would be charged service tax.

To ensure that the growing industry sector

pay their taxes properly, interest for delayed pay-

ment of service tax is being graded from 18% to

30% for each delay beyond 6 months and this cer-

tainly is a negative development for the industries

To conclude on the indirect taxation provi-

sions, it can be surmised that this governments

maiden budget has tried to address current tax is-

sues of the industry. This budget is more of newer

reforms with many amendments to The Custom

Act 1962, though we can expect a few more

amendments in the due course of running the gov-

ernment this year. This budget though of a reformskind has tried to connect all the dots laid by their

policies and agendas. For example, the dream of

building good roads across the nation has been

connected to the sops given to the imports of road

construction equipment and coal tar for making

roads.

The biggest network of connected dots - re-

ducing the export of indigenous raw materials like

bauxite (an ingredient for steel) by increasing the

export duty reducing the import by increasing the

import duty for flat rolled foreign steel and

providing softeners for industries manufacturing

steel was quite impressive to note. There have been

many other instances of such connected dots. To

wind up, it can be said that let us hope for the best

until a full years budget is presented the next year,

which will hopefully usher in a better and Jaitley-

Modified India.


11/12


12/12

NISHKA TEAM

Nishka is a monthly finance newsletter brought by the students of the finance club of

Christ University Institute of Management, Kengeri Campus. The idea behind coining this

issue of the magazine is to establish a learning among the students, which helps them to gain

an insight about the world of finance.

Faculty Coordinator

Prof. Shrikanth Rao

Coordinators

Niharika Shadra, F1

Niken Jain, F2

Articles By Designing By

Ankit Pandey, F2 Sharan Kumar G, F2

Aswathy Edison, F1

George P. Job, F2

Krishnendu Kundu, F2

Neha Mishra, F2

Niken Jain, F2

CHRIST UNIVERSITY INSTITTUTE OF MANAGEMENT, KENGERI CAMPUS

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