This was an important Budget as the Indian economy was grappling with important issues. The finance minister has touched upon many of these key issues, including growth, infrastructure development, social sector reforms, and government finances.
However, more needs to be done to push the economy on to a higher growth trajectory. The fiscal deficit is a challenge. The government did well on this count last year, and if the finance minister can keep his promise of bringing down the deficit to under five per cent of GDP, it will be a big achievement. With regards to taxes, direct and indirect taxes have not been raised, a move which has been well received by the investor community. On the contrary, the move to raise the exemption limit on personal income will support consumer spending. From the financial sector’s point of view, moves to raise the limit on foreign institutional investments in infrastructure bonds as well as allowing these institutions to invest in mutual funds are very positive steps in terms of enabling the flow of international capital into India to fund infrastructure development.
I also welcome steps to further social development, such as the increased allocation for education. Overall, the Budget sets a clear direction for balanced growth, and addresses issues high on the national radar.
Neeraj Swaroop
Chief Executive Officer,Standard Chartered
