This budget has tried to balance the need of equity with growth and fiscal prudence and for that it is laudable. However, it remains to be seen if enough has been done to give the necessary fillip to private investments.
The incentives for adoption of fintech equipment, expansion of digital infrastructure in under-served areas, Aadhar Pay for wider adoption by merchants and capping cash transactions at Rs 3 Lakhs, all together have kept the spotlight on building a less-cash India.
Looking specifically at Capital Markets, they will breathe a sigh of relief with no negative implications on Long term capital gains and the tenure for classification of the same. The focus on doubling farm incomes and increased spends on infrastructure as well as housing augurs well for an earnings recovery later in FY18.
We also welcome the emphasis on skill development and technical education - this will enable India to successfully harness the demographic dividend. The attention to affordable housing, greater employment in rural areas are the right interventions to build a more equitable society.
It is a digital economy budget. Government has pushed the digital theme in every area of the budget. Every person from a small shops to consumers are pushed towards the digital economy. Tax benefits, incentives to use digital payments and extending loans based on a digital footprint will create a larger merchant ecosystem for digital payments.
MAT: Proposed extension of period for claiming MAT credit to 15 years is a welcome move. FPI: It was already hinted that FPI's would be spared from the implications arising from indirect transfer by keeping the recently issued clarifications on hold. The proposed amendment to the law would rest at anxiety apprehensions of foreign investors.
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