Budget had nothing new for the auto industry

Budget 2014 was certainly not revolutionary, and did not offer any benefits to the auto industry.

However, it does set a directional approach, and is indicative of a medium to long term road map to achieve a 7 per cent to 8 per cent growth. It is also in sync with the election manifesto and outlines a policy framework for future.

The reduction of the fiscal deficit from 4.1 per cent in 2015 to 3.6 per cent in 2016 and 3 per cent in 2017 is a tall task. It is not clear how this would be realised. Overall, it appears to be an investor friendly, growth oriented budget.

Setting up an expenditure management commission is a step in the right direction.

The focus on reviving the manufacturing sector and job creation is once again a positive approach. Increasing the FDI cap in select sectors, particularly in insurance and defence to 49 per cent was as anticipated. The major negative is the non-repealing of the retrospective tax. Review of the transfer pricing regulations was overdue. Tinkering with benefits through individuals through direct taxation will generate a positive sentiment amongst the salaried class.

Generally speaking, the focus on inflation, housing and infrastructure, education, rural road development and the agriculture sector should provide the desired impetus to growth.

Therefore, whilst the intentions and direction are clear, it yet has to be seen how the FM can earn enough to pay for growth-oriented initiatives.

Disinvestment is a source of revenue generation to meet the deficit.

The modus operandi was not spelt out.

However, diluting stakes in PSU Banks and yet controlling interest was an indicator of the disinvestment plans during the current financial year.

Rolling back of subsidies was also not explicitly clarified.

Post new comment

E-mail ID will not be published
CAPTCHA
This question is for testing whether you are a human visitor and to prevent automated spam submissions.

EDITORIAL OF THE DAY

  • Banks must learn from past mistakes to promote financial inclusion

    Prime minister Narendra Modi launched a massive financial inclusion programme yesterday titled “pradhan mantri jan dhan yojana’ (PMJDY), that will

FC NEWSLETTER

Stay informed on our latest news!

INTERVIEWS

GV Nageswara Rao

MD & CEO, IDBI Federal Life

Timothy Moe

Goldman Sachs

Chander Mohan Sethi

CMD, Reckitt Benckiser India

COLUMNIST

Tushar Gandhi

Could prohibition mean profiteering?

In the mid 1930s, an American journalist asked Bapu if ...

Zehra Naqvi

The five universal languages of love

Love is a universal language. Don’t we all believe that? ...

Dharmendra Khandal

Time to protect our endangered wildlife species

After 65 million years of existence, the earth’s biodiversity is ...

INTERVIEWS

William D. Green

Chairman & CEO, Accenture