Key benchmark indices held firm at higher levels after Finance Minister said that GDP growth is seen at 7.2% to 7.5% in the second half of FY2018. At 11:44 IST, the barometer index, the S&P BSE Sensex, was up 170.25 points or 0.47% at 36,135.27. The Nifty 50 index was up 46.25 points or 0.42% at 11,073.95. The Sensex was trading above psychological 36,000 mark after opening above that level. Positive global cues also boosted sentiment.
Finance Minister, Arun Jaitley started his Union Budget speech for the financial year 2018-19 in parliament at 11:00 IST today, 1 February 2018. The finance minister said that India is poised to become the fifth largest economy very soon.
With demonetisation, the quantum of cash currency in circulation and increased tax base and has also help improve the digitalization of our country, said Arun Jaitley. He also added that Foreign direct investment has gone up, while the GDP at 6.3% is a signal of a turnaround of the economy. He added that exports are expected to grow at 15% in 2018-19.
Among secondary barometers, the BSE Mid-Cap index was down 0.05%, underperforming the Sensex. The BSE Small-Cap index was up 0.66%, outperforming the Sensex.
The market breadth, indicating the overall health of the market, was strong. On BSE, 1,554 shares rose and 904 shares fell. A total of 145 shares were unchanged.
Public sector bank stocks edged higher on hopes of further capital infusion after the finance minister Arun Jaitley in his Budget speech said that the public sector banks are ready to support India's growth. IDBI Bank (up 1.41%), Punjab National Bank (up 1.11%), Indian Bank (up 0.99%), Bank of India (up 0.73%), State Bank of India (up 0.56%) and Bank of Baroda (up 0.25%) gained.
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Jaitley in his Budget speech for FY 2019 said that the recapitalised public sector banks (PSBs) are ready to support India's growth. The country achieved 7.5% average growth in three years of NDA government, he said.
Agri stocks rose after the finance minister in the budget 2018-19 laid emphasis on agriculture and farmers. Dhanuka Agritech, Jain Irrigation Systems, Kaveri Seed Company, Monsanto India, and Shakti Pumps rose by 0.38% to 4.03%.
Finance Minister Arun Jaitley in budget presentation said that Budget 2018-10 will focus on agriculture and rural economy. The government's emphasis is on generating higher income for farmers. Arun Jaitley wants farmers to earn 1.5 times on their produce. Prime Minister aims to double farm income by 2022, he added.
National Agriculture Market (NAM) is a pan-India electronic trading portal which networks the existing APMC mandis to create a unified national market for agricultural commodities, he added. 470 APMCs have been connected to eNAM so far, restare expected to be connected by March 2018. Government to look at cluster-based growth model in agriculture, he added.
Food processing sector growing at 8% per annum; allocation being doubled to 14 billion rupees in 2018-2019.
Cultivation of horticulture crops in clusters can boost production and marketing, he said. Agri-market Development Fund with a corpus of Rs 2000 crore to be set up for developing agricultural markets. Operation green along lines of Op flood and corpus of Rs 500 crore is kept.
Budget allocation to the food processing industry will be increased from Rs 715 crore to Rs 1400 crore. Finance Minister said will look at cluster development model for horticulture & agri crops. Grameen Agricultural Market (GRAM) will provide farmers a means to sell directly to buyers, he added.
Most fertilizer stocks nudged higher after the finance minister Arun Jaitley in his Budget speech laid the government's thrust on agriculture. Gujarat State Fertilizers & Chemicals (up 1.87%), Deepak Fertilizers & Petrochemicals Corporation (up 1.68%), Gujarat Narmada Valley Fertilizers & Chemicals (up 1.63%) and Coromandel International (up 0.85%) edged higher. Chambal Fertilisers & Chemicals (down 0.75%) declined.
Jaitley, in his Budget speech for FY 2019 said that the government will create a mechanism, that is expected to double the income of farmers by the year 2022. The focus is on low-cost farming, higher minimum support price (MSP). The MSP of all crops shall be increased to at least 1.5 times that of the production cost, FM said. Agri-Market Development Fund with a corpus of Rs 2000 crore to be set up for developing agricultural markets, he added. Jaitley proposed to raise institutional credit for agriculture to Rs 11 lakh crore for FY 2019.
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