Budget 2018 Reactions: Superb, Dream And A Balanced Budget
"Overall, it is a very balanced budget," says DK Aggarwal, Chairman & Managing Director- SMC Investments and Advisors Limited
On a scale of 1 to 10, how would you rate the Union Budget?
I will give it an 8 out of 10.
Do you feel this is an election/populist budget or a developmental budget considering the elections next year?
I think it is a development oriented budget. Of course, there have been considerations keeping the elections in mind also, but, if you look at the overall budget, many provisions like making healthcare available to poor families, fixing the MSP for kharif crops to be 1.5 times of the input cost are all historical announcements as 50 per cent of our population depends on agriculture for their livelihoods. Hence, all these decisions are going to benefit the aam aadmi, farmers and the agricultural sector as a whole. Also, the budget extends sop to MSMEs by proposing to cut the corporate tax rate to 25 per cent for companies with annual revenue of up to Rs. 250 crore. So, earlier 96 per cent companies were covered under the tax net now 99 per cent companies will come under it which is a hugely positive step. Similarly, the announcement regarding the standard deduction of Rs. 40,000 for the salaried employees is again a welcome move by the Government. Coming to the fiscal deficit target, as per fiscal prudence it should not have been increased from 3 to 3.5 per cent, but considering the fact that India is a developing economy and in the light of it, this extra deficit projection can be compromised. Since, we are now moving to a new growth trajectory, the Government needs to spend a lot of infrastructure development, thus, I believe it is justified and should not be taken negatively. The only slight deviance in the budget is the announcement of tax on long term capital gains of 10 per cent on profits exceeding Rs. 1 lakh made from the sale of shares or equity mutual fund schemes held for over 1 year. Although, this will have a negative impact in short term, the fundamentals of our economy are very strong and I believe even this impact will get absorbed. Hence, overall I would say it is a balanced and positive budget.
Has the Government addressed the job/employment issue adequately in this Budget?
Yes, the Government has allocated a lot of money on skill development and agriculture which is one of the largest employers, they have even talked about giving impetus to affordable housing by creating a dedicated fund under the National Housing Bank (NHB) which is a huge step. Also, the Government’s thrust to the infrastructure sector will also give a lot of employment to the youth.
Is the farm distress/agri crisis addressed well in this Budget?
I believe the fixing of MSP for kharif crops to be 1.5 times of the input cost adequately takes care of our farmers’ biggest pain area and has been adequately taken care of. The Government’s statement that it will discuss with Niti Ayog to develop a mechanism where even if the farmers have to sell their produce at a lower price than the MSP, they get adequately compensated. Hence, I believe in the statement.
Summarize the Union Budget in a few lines.
This budget will give inclusive growth to our economy as it takes care of farmers, agriculturists and even the businesses. Overall, it is a very balanced budget.
Three hashtag words/expressions to sum up the budget 2018.
Superb, dream and a balanced budget.
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