Union Budget 2015-16 analysis by SBICAP Securities:
The Union Budget 2015-16 makes a clear case for pushing up public investment. The 3.9% fiscal deficit assumption is well thought out and the revenue numbers may be overshoot if the economy revives as per expectations. The assumptions of a nominal GDP growth at 11.5% and a tax buoyancy at 1.4 looks perfectly reasonable given the increase in service tax and rationalization of excise taxes.
The decision to incentivise credit card transactions coupled with a new law on black money will clearly lower the social cost for unaccounted money. The proposed introduction of a gold deposit scheme is a big positive and conservative estimates show that the monetary value of gold deposits mobilized may be at least Rs 1 lakh crore. This apart, the proposal to channelise pension funds to infrastructure is a welcome move and will give a fillip to the NPS. The other positive steps in the budget include the proposal to frame a Bankruptcy Law and a Dispute Settlement. The move to align NBFCs at par with financial institutions will allow banks to clean up their balance sheets. Overall, the Union Budget in tandem with Railway Budget seems to have laid out a well thought out plan for the future.
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