According to the global financial services major, global investors view India favourably not just for its growth outlook, but also because of its robust/stable macro story reflected in falling inflation and stable currency.
The Union Budget largely received a positive response from experts across the industry. Here's a round up of what they had to say.
India‘s experience has reaffirmed the need for rules to contain fiscal deficits, because of the proclivity to spend during booms and undertake stimulus during downturns, the Survey notes.
Speaking to CNBC-TV18, Hemant Kanawala of Kotak Mahindra Old Mutual Life, said that the Mukesh Ambani-led Reliance Jio would remain aggressive till it achieves its targeted market share.
The key focus this Budget will be on fiscal consolidation and the government is likely to stick to this path, say sources. The Budget will be presented by Finance Minister Arun Jaitley on February 1.
The Union budget is going to be a "market-neutral" event as policymakers are not likely to change their policy stance and will continue to focus on fiscal consolidation, says a Morgan Stanley report.
India pitched for a ratings upgrade with global agency Fitch Ratings citing improvement in macroeconomic conditions and the government's commitment to fiscal consolidation
Growth and fiscal consolidation can happen together and it is a balancing act, said Arun Jaitley, Finance Minister, in an interview with CNBC-TV18. He was speaking from Tokyo where he has gone on a six-day visit to woo investors.
While finance minster displayed good endeavors to maintain country‘s journey on path of fiscal consolidation, he disappointed big businesses who expected to see FM snip corporate tax rate.
He says sticking to the fiscal consolidation target will be taken positively, adding he has always pitched for a rate cut and if the fiscal deficit target is achieved then the Reserve Bank will get more room to cut rates. He feels the process should begin with at least 50 basis points cut.
The Survey said that the fundamental task of the Budget should be to preserve fiscal sustainability. This is on the lines of what RBI Governor Raghuram Rajan has been arguing all along; that fiscal prudence was essential for sustainable growth.
In an interview with CNBC-TV18, Devendra Joshi, Equity Strategist at HSBC said that he continues to be underweight and defensive on Indian market as growth and earnings continue to be a worry.
Overall, this Budget will be a tightrope walk as per Nomura‘s analysis.
Underweight on India, the global brokerage firm today said in a report that despite the recent sell-off in Indian equities, there remains a mismatch between expectations and reality which has not been "fully priced in".
RBI today left the key policy rate unchanged but indicated at accommodative stance saying with "inflation moving closer to the target" there would be more room for rate cut to support growth.
"Although we expect the administration to pursue its stated fiscal consolidation programme, we foresee that planned revenues may not fully materialise and subsidy cuts may be delayed," S&P Ratings Services India Sovereign Analyst Kyran Curry told PTI.
Chidambaram said more policy steps by RBI were possible if the government stayed firmly on path of fiscal consolidation.
In an interview with CNBC-TV18, Urjit Patel, RBI Deputy Governor said with low inflation and improving external relations, India is on its path to fiscal consolidation.
Nilesh Shah of Envision Capital says the government must now look at non-strategic areas for divestment and suggests making Life Insurance Corporation of India (LIC) a public entity.
The government has overachieved on the fiscal consolidation target for FY15, and at the same time improved the management as well as quality of the fiscal deficit.
After Moody‘s upgraded India‘s ratings outlook from stable to positive, while reaffirming its rating at Baa3, former Reserve Bank of India governor and former prime minister economic advisor C Rangarajan said rating agencies would be â€œcompelledâ€ to upgrade the country‘s ratings once GDP growth hits 8 percent.
As per the agency, GDP growth is likely to be at 7.4 per cent this fiscal and 8 per cent in the next, based on new series.
As far as the domestic data is concerned, the big event has been obviously the Budget and really clarification on what the fiscal consolidation roadmap is and we had obviously said 4.1 percent, 3.6 percent and then 3 percent
Encouraged by softening inflation and fiscal consolidation roadmap by the government, RBI on Wednesday slashed key policy (repo) rate by 0.25 percent to 7.5 percent, the second such surprise rate cut outside regular policy review in less than two months.
By cutting the repo rate, the RBI has shown faith in the fiscal consolidation measures outlined by Finance Minister Arun Jaitley in the Union Budget on Saturday