Industry Leaders And Experts React on Annual Budget 2019
How would you sum up this budget? Are you happy with the announcements?
Sumant Sinha: Ya, I am happy with the budget. I think he (FM) has done a good job of balancing the electoral side with the macroeconomic stability.
Ratul Puri: I think it is a good budget. We saw a report card from the government (in terms of) achievement over the last five years. There have been some very good achievements and a vision for what they are going to do. Besides that, the two major schemes (announced) were aimed at middle class India (by) increasing the tax deduction limit to Rs. 5 lakh (per annum) and (providing) direct benefit transfer to the marginalized parts of this country. This is good because we have to address the poor of this country. As India grows, we have to carry everyone along with us.
Shobana Kamineni: The pleasant surprise was for the middle class (as) they are giving income tax exemption (of) upto Rs. 5 lakh. It was a pleasant surprise and I do think that budget spoke about e-commerce (and) that are clearly working towards (a) large trader base, more employment, and that to me is a good thing that the government is keeping it real. But we think what India needs is money being spent on infrastructure, create new jobs, and really ease of doing business. My belief is balancing act was good. From an industry point of view, my expectation was low. So what they have done is actually good.
Chandrajit Banerjee: I think it is a very straightforward budget. What one sees is a prudent way of handling the economy at this point of time. He has given a very good focus on people. It is a people’s budget. We see a sort of economic buoyancy getting created by making it a people’s budget. There is a very strong focus on rural India, farmers, middle income group, salaried income and workers through social security, etc, which has been detailed in the budget. It is something which will help create the consumption demand which will, in turn, create strong buoyancy for the economy.
Is there enough in the Budget to tide over the unemployment crisis?
Sumant Sinha: That is very hard to say. One budget is not going to do the trick. It has to be a series of ongoing steps the government has to take. He has tried to address some issues on farmer distress, creating a pension safety net for day labourers. I think he has the done the best he could do in an interim budget right.
Ratul Puri: Unemployment and job creation are challenges and cannot be addressed in one interim budget. Unemployment is a long-term strategy and I believe low inflation and low-interest rate economy is at a high level. Fiscal measures you (govt) can take which eventually five or 10 years out will address the employment problem. This is because low inflation or low-interest rates in the economy makes industry more competitive. As that happens, the industry grows and creates more employment.
Shobana Kamineni: With regard to budget, they will have some money in their hands. With regard to the income tax, they actually said they will get the funds back. So people (will) have some amount of (additional) income. In terms of unemployment, what are we talking about? We are trying to solve till May (2019). So would have been too ambitious.
Chandrajit Banerjee: I think he has addressed the way one tides over (unemployment crisis). He has talked about tax buoyancy and I think the economy itself will create tax buoyancy and there will be more tax which he will work around the fiscal I believe. But the economic buoyancy itself will give rise to more jobs. He has detailed that (on) how more jobs can be expected because of the type of ecosystem that one is building up from different small and medium companies, different new-age companies (such as) start-ups that will come up. And of course, economic activities that lead to more jobs.
How do you look at the reach-out to the farmers, in the Budget?
Sumant Sinha: Look, I think it is positive because farmer distress is something which is very prevalent at this point of time. Anything the government can do to address that, I think, is welcome.
Ratul Puri: As I mentioned earlier, there were lots of small announcements. The big announcement was the Rs. 6,000 direct benefit transfer into the accounts of marginalized people.
Shobana Kamineni: I think they like the Telangana model. They seemed to have borrowed from the state that I live in. It did have shades of Telangana in it. I don’t believe in waiving off farm loans. Do this, figure out to get MSP correctly and reward farmers for good work. Put all those in place. I like the interest subversion.
Chandrajit Banerjee: So, there is a phenomenal focus on the farmers and rural India. We see coming in, not only in terms of direct benefit transfers to farmers but a complete and a clear focus that the farmer now has an assured income which is itself a critical way to look at rural economy strongly.
Is there enough for the industry?
Sumant Sinha: No. It is an interim budget. So it is not like there are lots of announcements for the industry or anybody else for that matter.
Ratul Puri: I think you don’t expect major announcements in the interim budget for the industry. With most taxes moving to the GST framework, you have seen major moves around GST around slab rationalization and around reduction of GST in certain categories. That has already taken place and is driven now (decided) by the GST Council. I think what is good for the industry is the 10-year vision (laid out by the govt.) and in the short term is obviously the fact that you will see the movement of Rs. 75,000 crore into the hands of consumers, who will eventually spend this money buy goods and services and that will indirectly benefit industry.
Shobana Kamineni: I told you our expectations were nil.
Chandrajit Banerjee: The economy is going very strongly and as a result, the consumption demand will get boosted and will ultimately lead to a lot of industrial activities.
How should the aam aadmi and the middle class look at the Budget?
Sumant Sinha: I think so because the tax exemption has been given. Apart from that, a lot of other things have also been addressed around real estate and so on.
Ratul Puri: I think there were two announcements in the budget. One is the Rs. 6,000 crore DBT and the other was the increase in the tax deduction limit to Rs. 5 lakh.
Shobana Kamineni: They should be definitely happy. You are looking at 3 crore middle class people that are benefitting from this. You are looking at a huge number of farmers. They have really done well.
Chandrajit Banerjee: There is a big focus on the middle class and aam aadmi.
Any thoughts on Piyush Goyal as FM?
Sumant Sinha: He is a friend and somebody I have known for a very long time. He is extremely capable, smart, and I think the performance he did today as representing the budget today was very impactful.
Ratul Puri: He is a great leader and will manage every portfolio he takes on well. He is very articulate and very intelligent. I think he has a broad portfolio already. Arun Jaitley has done an exceptional job (for) over 4 years. From what you hear, this budget was put together by him, crafted by him. Unfortunately, due to his health conditions, had to be delivered by Piyush Goyal.
Shobana Kamineni: I think he has always been there in the wings. He is very shrewd at business and knows the job and did a very creditable job. We wish Arunji the best of health. He is a brilliant man but Piyush has done a great job.
Chandrajit Banerjee: He did a great job in presenting this interim budget.
