Budget 2015 - drive growth, savings, infra |
India`s Finance Minister Arun Jaitley presented India`s annual budget for Fiscal 2015-16 on February 28 and proposed appointing experts to draft a legislation for expediting regulatory clearances to improve the ease of doing business. The vision of Prime Minister Narendra Modi`s government became apparent as the sharp and smart budget drives growth, incentivizes savings and ushers in a progressive tax regime to shore up money for capital expenditure in infrastructure development. Jaitley said the government wishes get projects off the ground. He said a recently launched E-biz portal integrates 14 regulatory permissions at one source. He said numerous states might soon join this platform. India could only alleviate poverty by creating jobs and the answer lay in spurring both domestic and foreign investment, the Minister said. India`s ranking of 142 in 189 countries in the latest World Bank report and falling two places from 2014 ranking was not a good indicator, he said. The government is taking steps to bring India into the top 50. Highlights of the Union Budget 2015 are: Fiscal deficit* Deficit target at 3.9% of GDP in 2015/16* Will meet target of 4.1% of GDP * Medium term target of 3% of GDP * Current Account Deficit below 1.3% of GDP * Discipline to seek higher investment Growth * GDP growth could be 8 - 8.5% y/y * Aiming double digit growth rate Inflation * Consumer inflation to remain close to 5% by March, room for monetary policy easing * Monetary policy framework agreed with RBI to keep inflation below 6 % Policy reforms * Proposed Universal Social Security system * Proposed to merge commodities regulator with SEBI * Allocates Rs. 346.99 bn for rural employment guarantee scheme in 2015/16 * New bankruptcy code in 2015/16 * Amend the RBI act in 2015, set up monetary policy committee * Set up public debt management agency Taxation * Goods And Services Tax by April 2016 * Internationally competitive Direct Tax Regime on rates without exemptions Infrastructure * Investment up by Rs 700 bn in 2015/16 * Set up National Investment Infrastructure Fund * Proposed tax-free infrastructure bonds for roads, rail and irrigation projects * Proposes 5 ultra mega power projects of 4,000 MW each * Second unit of Kudankulam nuclear power station in 2015/16 * Build 100,000 km more of road * Public Sector Ports to corporatise under Companies Act Expenditure * Revenue hike will help allocations for rural job scheme by Rs 50 bn in 2015/16 Subsidies * Subsidy rationalisation based on cutting leakages Finance minister`s comments * The world is predicting India`s time to fly * We inherited a sentiment of doom and gloom. The investment community had almost written us off. We have come a long way since then. * We have turned around the economy, dramatically restoring macroeconomic stability and creating the conditions for sustainable poverty elimination, job creation, durable double-digit economic growth. * Domestic and international investors are seeing us with renewed interest and hope.
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