Keeping in mind the existing macroeconomic realities, I feel the Honourable Finance Minister has presented a well calibrated budget.
Keeping in mind the existing macroeconomic realities, I feel the Honourable finance minister has presented a well calibrated budget. Union Budget 2013-14 has been a sincere attempt to re-start the growth engine while trying to maintain fiscal rectitude to the maximum possible extent.
It is heartening to note that infrastructure development has figured prominently in his speech. The initiatives to provide support to infrastructure debt funds (IDFs) are commendable, especially as the banks are constrained and unable to increase their exposure to infrastructure projects. I hope the IDFs will be able to mobilize resources from a diverse cross section of investors with Government’s active participation.
There are several other positives for the infrastructure sector. Enhanced corpus for MGNREGA, PMGSY, RIDF, Indira Awas Yojana along with increased funds for NABARD so that refinancing can be extended to projects pertaining to warehousing, cold storage, etc. will go a long way in addressing the supply bottlenecks that have been fuelling food inflation.
The decision to announce 3000 km of new road projects in next 6 months, the proposal to build 2 new ports (in West Bangal and Andhra Pradesh), 1 harbour in Tamil Nadu, dredging of national waterways, proposal to create a grid (combining ports, inland waterways and roadways) augur well for the infrastructure sector.
The work on 3 industrial corridors is also something to cheer about. I am especially excited about the proposal to step up domestic coal production by forming PPPs with Coal India Ltd. Also States have been encouraged to submit their discom restructuring plans to Ministry of Power and avail benefit of the scheme.
As regards, oil & gas sector, the proposed move to move from a profit sharing to revenue sharing arrangement in terms of shale gas production is also a step in the right direction.
National Housing Fund has been provided additional funds to promote rural housing through refinancing and has also been instructed to set up an urban housing fund. Further, additional tax incentives for the first time home owner is also a good move. I feel all these steps will play an important role in stimulating internal demand that will help in pushing the economy to a higher growth path.