Attempt to bring fiscal consolidation: Seshagiri Rao

The Budget, with the limited availability of fiscal space, attempted to bring fiscal consolidation with lower fiscal deficit of 4.8 per cent and simultaneously made higher allocations to various schemes to spur investments.

Announcing 15 per cent incentive for acquisition and installation of new plant and machinery by manufacturing companies during the period beginning from April 1, 2013 and ending March 31, 2015 is a welcome step to boost investment. 

Higher allocation of 29.4 per cent towards plan expenditure and increased outlays for social infrastructure, education, rural development, health and urban development are also expected to stimulate economic activity.

As most of the projects are stalled due to regulatory and bureaucratic delays, the  expectations from the budget to ease the process of clearances is not met since the effectiveness of  Cabinet Committee on Investment is yet to be established.

It is a matter of concern that the total non-plan revenue expenditure particularly interest payment and subsidy remain at elevated levels. It is also challenging to achieve an increase of 19 per cent in tax revenues when the economy is slowing down and there are no immediate signs of recovery.

However, lower fiscal deficit, announcement of introduction of DTC bill in this budget session and possible GST rollout are encouraging take outs from this Budget.

Seshagiri Rao

Joint Managing Director, JSW Steel