Experts discuss agenda for new govt beyond Budget 2014

Khambatta: Yeah, he has done it. If you ask me from the very fact that we are seeing more interest of the private equity (PE) players in India, we are seeing more interest of the Foreign Institutional Investor (FII) players in India. People believe that we wanted stability, they wanted confidence.

What he did in Gujarat is that he created a conducive environment for business. He did this Vibrant Gujarat once in two years, invited the biggest of the names and told them, here is your field, you go and take over and in my mind he has always been pro-industry to the extent that he sides with industry if they are doing a good job. He also wants development and it is a very good and proactive Budget that he has given.

Of course, there are a lot of negatives. He could have done a lot and possibly, I can spend a lot of time on that. However, overall it is a step in the right direction.

Q: The expectations are very large. Do you think he met the expectations or as Piruz says the pragmatic expectation was and KV Kamath says that here is someone who will listen and when I say he, I mean both the Prime Minister and Arun Jaitley because clearly Piruz talks about the Prime Minister?

Shah: As usual, we will always have a few people who will have very stretched expectations. So, there was a part of the investor group or the market expectations from the industry itself who wanted big bang, who wanted quick change almost like a u-turn from everything India has done and fortunately he did not follow that.

The Budget is more about being very balanced. There is a little bit on it for everything. There is continuity because he has not completely turned around what the earlier government was doing and there is still change and to get this done is always not very easy and you can’t keep everybody happy.

But on the whole, if you study it you will see that he has covered a large range of issues, a large part of the issues have been covered and this whole thing what I call basically balance, continuity with growth is what he has achieved. Broadly, a large part of the investor group is fairly happy with this.

Q: Let me talk you as a representative of foreign direct investment (FDI). You were Chairman of Pfizer, you are on the board of ING Vysya Bank and some other companies as well. Has he done enough to get foreign investor confidence and I don’t mean just FII but foreign direct investor confidence back into the country or do you think that the fact that he stopped at 49 and not 51 in certain sectors, do you understand that as a reality, a real politic or would you think that will disappoint?

Handa: Big bang announcements don’t materialise, but as a finance minister he hasn’t had control of revenue and expenditure. And what as we have seen that he has not done enough on the revenue and expenditure. There are things that he has moved forward let’s say, insurance from 26 percent to 49 percent and defence. Now it is not going to make any difference doing 49 percent and then saying that the management control will be Indian control. You are not going that extra length that is required for the investment to happen and in insurance, you are setting almost about USD 3 billion; in defence it could be 10 times more than that figure.

For full interview, watch the video

Meanwhile, here’s a quick take on what other experts think of Budget 2014:

Deepak Parekh, Chairman, HDFC: Considering the shortage of time I think he has done a good job. He has made number of clarifications. He has not gone overboard on anything. He has talked about fiscal prudence, he has talked about inflation control. He has emphasized housing in a big way, Infrastructure, manufacturing, he has taken care of some of these issues which were there.

On the negative I would say that he has taken a cautious approach. There is no big bang in anything. There is nothing revolutionary. He has still maintained the 51 percent limit for Indian companies, banks, for defence sector.

KV Kamath, Non-Executive Chairman, ICICI Bank: My quick take on the Budget, it ticks all the boxes and more importantly to me it shows a willingness to listen to what are the challenges and state that I have listened, we the government have listened and we will act in due course. To me that is a statement of intent which I will take entirely at face value and I believe that in the next six months we will see action on this front.

Sunil Munjal, Joint MD, Hero MotoCorp: He has actually covered probably the widest spectrum of issues and subjects which have been raised by all sectors in recent times. He has addressed issues which industry has raised, civil society has raised, agriculture has raised, that financial industry has raised both inside and outside.

Ajay Shriram, President, CII: Approach of the finance minister and the government has been very comprehensive in looking at the nation in totality besides the tax which is one part of it. He has covered every section of society. Rs 25 crore investment allowance which is coming down. He is looking at addressing the inverted customs duty issues. He has looked at the excise duty which he brought down on food processing and many other industrial areas. We are actually happy. It is not a one time big bang approach.