Union Finance Minister Pranab Mukherjee marginally raised the Income Tax exemption limit, abolished Fringe Benefit Tax and Commodity Transaction Tax and announced some schemes to benefit the
aam aadmi.
The reaction to the Budget was varied: the Opposition blasted the Budget, the industry captains hailed it, and the Sensex plunged by 870 points on Monday.
What exactly does the Budget hold for the common man? Will you benefit from the Budget proposals? Or do you really don't care? How does it affect you?
In an hour-long chat on
rediff.com on Wednesday, COO of Dun & Bradstreet, India
Kaushal Sampat offered some tips. Here is the transcript:
Kaushal Sampat says, i am here to answer your questions. cheers, kaushal
Madhu asked, how is budget 2009 is benefit for farmers?
Kaushal Sampat answers, at 2009-07-08 14:27:43The strong focus of the budget on the irrigation sector reiterates the Government's commitment to boost the overall agricultural growth in India. Moreover, the substantial increase in the target for farm credit to Rs. 3,250 bn coupled with increase allocation for Krishi Vikas Yojana and an allocation for agriculture R&D are some of the key measures intended to promote growth in the agriculture sector. The proposal to move towards a nutrient based subsidy regime for fertilizers is commendable and is expected to result in availability of innovative fertilizer products at reasonable prices. The extension of period for repayment of overdues under the Debt Waiver augurs well for debt-ridden farmers. The additional subvention of 1% on short-term crop loans is expected to encourage farmers to repay their crop loans on schedule.
anup asked, do u think it wl increase ?
Kaushal Sampat answers, The market may have some short term concerns because it expected some major policy announcements. Else, the direction of the Budget is positive. Short term focus on economic revival is absolutely appropriate. I personally believe that this Budget is positive for the Economy and the market will soon recognize this.
akash asked, hi kaushal any benefits for IT industry
Kaushal Sampat answers, Excise and CVD exemption on packged software is expected to boost sales and check. The Indian IT industry is expected to be indirectly benefited from various government projects like modernisation of the employment exchanges and Unique Identification Authority of India's plans of setting up of online databases with identity and biometric details of Indian residents. Implementations of these programs will lead to a wide usage of Internet besides providing a huge business opportunity within India (especially in times of economic slowdown) to both IT software as well as IT hardware industry. Budget announcements have also proposed the setting up of an alternative dispute resolution mechanism within the Income Tex Department to effectively address tax issues faced by foreign companies in a short span of time. This move will boost foreign investment in the sector/country. Budget announcements have also earmarked an amount of Rs 9 bn for "Mission in Education through ICT" and Rs 21.13 bn for IITs and NITs. These moves will assist in the creation of quality talent pool that is in line with global IT standards and will ease the industry's "knowledge-pool" scarcity.
rajesh asked, sir i wants know budget effect on print media or newspaper industry
Kaushal Sampat answers, In the Budget, the print media stimulus package has been extended by six months till December 31, 2009. This move will help the industry mitigate the risk arising out of the global crisis and is expected to provide a boost to the sector. However, I would say that the Budget is broadly neutral for this sector.
rp asked, how banking and housing finance will be effected with this budget?
Kaushal Sampat answers, The overall impact of the budget on the banking and finance sector was positive, though not up to the expectations of the industry. The budget specified that public sector banks would remain in the public sector. The government reiterated its commitment towards providing capital support to banks to retain growth and competitiveness. Observing that the industry has made significant strides towards financial inclusion in the past few years, the budget made ambitious plans with respect to financial inclusion in the next three years. The addition to the Debt Waiver and Debt Relief Scheme continued, with the increase in the time allowance to repay 75% of the debt. The scheme also influenced the introduction of an interest subvention for farmers repaying loans on time. Most of the announcements made in the budget were aimed at increasing the credit flow to needy sectors, and not at directly facilitating the banking industry. The abolition of the Commodities Transaction Tax will be beneficial for the traders trading on commodity exchanges.
Raveendra asked, I want to know how this budget will be useful to middle class people
Kaushal Sampat answers, I think the FM has tried to put more money in the pockets of tax payers by eliminating the surcharge. Of course, it would have been wonderful if the Standard Deduction had been taken up substantially, but I don't think he had room to do that in the current fiscal scenario. You have to view the FM's measures from the prism that he wants to try and stimulate demand in the economy. Also, there are lots of measures for rural India - both middle class and lower class. I think its important to keep our rural brethren in mind while trying to evaluate the FM's Budget.
bnp asked, As FM focused on the recession? because lots of people are losing jobs? Does this budget give any hope to these people?
Kaushal Sampat answers, If anything, the FM has focussed almost completely on the current economic environment. The Budget clearly breaks down into three parts short, medium and long term. The short term proposals, which are focused on economic revival, are slightly above our expectations, and are welcome for the support they'd provide to an economy which is expected to get back on the revival path soon. This, along with the impetus on infrastructure spending, should help the country fight job losses in the economy, especially in manufacturing sector.
gita asked, POWER SECTOR: WHAT IS FUTURE OF POWER SECTOR COMPANIES IN NEXT 5YRE. ON AN AVERAGE WHAT RETURN WE CAN EXPECT IN YRS
Kaushal Sampat answers, The Union Budget has been positive for the Power