With high global uncertainty and moderated domestic growth, the Government of India is expected to continue fiscal consolidation while focusing on capital expenditure to boost infrastructure. Projections suggest a modest fiscal deficit reduction, tax revenue growth, and strategic debt management
While there will be a lot of noise around it, you need to keep your eyes trained on four parameters. Here they are.
With tax rate cut to 25 percent for small and medium enterprises with revenue under Rs 50 crore per year, we are ahead of the roadmap, says the CEA. This new tax rate creates a level playing field for all corporates, he adds.
With the Modi government completing two years of ruling, Nilesh Shah, MD of Kotak Mahindra Asset Management believes that the Indian economy has performed much better than other emerging countries like Brazil and Russia.
The environment in the world is still volatile and India does not have a catalyst to drive ahead if the world is still weak, so stick to defensive stocks, says Pratik Gupta, Head-Equities, Deutsche Bank India.
The Finance Minister has decided to adhere to maintaining a fiscal deficit of 3.9% and 3.5% in RE 2015-16 and BE 2016-17.
The Union Budget 2016 does have benefit of large savings on fuel subsidy due to lower oil prices.
Richard Rekhy, CEO, KPMG India said the government should not sacrifice fiscal prudence. He feels the government can have a fiscal deficit arising out of creating assets but capital expenditure may not necessarily be bad because it will help in generating revenues.