Jamshedpur, Feb 1: State�s largest industrial hub at Adityapur has hailed budget. According to the industries, the Union Budget presented by the Finance Minister will not only boost the income but will also enhance the purchasing power of the citizens which in turn will bring much awaited cash liquidity in the market.
The Confederation of All India Traders (CAIT) National Sectary Suresh Sonthalia said that the proposals made in the budget if put to implementation will certainly take India to a 5 trillion economy. The budget will promote more exports which will gain more share in global market space and consolidate Country’s position at global
Sonthalia said that the Government has taken very crucial steps to streamline the trade and commerce in the country. Steps for affordable housing, promotion of digital payments, streamlining labor laws, vision to create each district as an export hub.
The trade leaders said that strengthening the Non-Banking Finance Companies are one of the important announcements of the budget which will prove to be a game changer for national economy since NBFCs are major lending agencies to small businesses. Increase in Tax Audit limit from 1 crore to Rs.5 crore is a much progressive step and the commitment of the Government to curb tax harassment is highly appreciated.
Another trader said that the announcement for providing digital connectivity at government schools through Bharatnet as it would provide even rural students to gain access to internet and teaching through smart boards. The allocation of Rs 99,300 crore for education sector hints at the government effort at improving educational scenario.
Meanwhile, HK Pradhan, Professor of Finance & Economics, Chair, Financial Market Centre, XLRI said said : �Most importantly the fall in the Bank Nifty due to the additional burden on the banking sector due to five times hike in the deposit insurance costs, up to Rs 5 lakh per depositor. There are no clear policy measures as regards the banking sector is concerned, except that they are encouraged to raised borrowing from the market for additional capitalization. Disinvestment of the Life Insurance Corporation to the extent of 10 percent will bring substantial money for the Government given their valuation which stands over 29 Lakh crore. This along with the dilution of Government remaining share in the IDBI Bank and the sale of Air India that has already announced which will add to Government�s kitty.
He noted that the macro worries still remain, given that fiscal deficit targets raised to 3.5 per cent of GDP along with a lower target of nominal GDP growth target of 10 per cent for the FY21, and the unclear roadmap for the higher borrowing programme of the Government. Inflation is already catching up and the lowering of the interest rates path will be held back, the RBI�s Monetary Policy Committee (MPC) is expected to keep the Repo rate steady. The Budget has not addressed the present demand slackening that has contributed to the growth slowdown, and particularly rural consumption, which might delay the revival of the economy in the near term.
