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The Union Budget for FY16 has unveiled a vision for the future. The government has rightfully decided to spruce up public investment to channelise private investment. The 3.9 per cent fiscal deficit target for the next fiscal looks well thought out with the revenue assumptions having the potential to overshoot. The decision of a bankruptcy law has been a long standing demand from the bankers. Uniform bankruptcy code for easy exit also spells the course to be adopted by lenders henceforth. Also, the decision to have commercial courts acting under the judicial courts may fast track debt recovery. For lender this appears to be a big positive as tightening of defaults will lead to ease of doing business.
The proposal for a public contract (resolution of disputes) law would enable to cut down the time taken in resolving disputes arising out of public contracts in the infrastructure sector. The industries aligned to infrastructure are construction, real estate and project management companies that will clearly benefit. The encouragement to use cards instead of cash not only allows banks to focus on services but do away with large manpower dedicated in handling cash at branch level. In short, this particular move will effectively bring down the social cost of unaccounted money, apart from adding to the bank bottom-line.
Arundhati Bhattacharya
Chairman, State Bank of India
Chairman, State Bank of India
