Budget 2013: Right expectations from FM are..

by Feb 21, 2013

Budget 2013 will be a test of sorts for Finance Minister P Chidambaram. Despite a set of reforms announced since September 2012 and and the huge inflows from foreign institutional investors  into the equity market this year, the benchmark equity indices have disappointed so far in 2013.

Several analysts are betting on Chidam­baram to unveil a ‘dream budget’, on the lines of his famous 1997-98 budget, where he had set the stage for lower income tax rates, removed surcharge on corporate taxes and reduced corporate tax rates.However, the Dream Budget  he presented  turned out to be a nightmare for the economy, and things went out of control. This time, the external, fiscal and macro environments are already in bad shape, and the headwinds are for real. With the rating agencies breathing down his neck, one of P Chidambaram’s efforts would be a keep them in good humour even while trying to revive the dormant animal spirits of India’s businessmen.

g

Several analysts are betting on Chidam­baram to unveil a ‘dream budget’, on the lines of his famous 1997-98 budget, where he had set the stage for lower income tax rates, removed surcharge on corporate taxes and reduced corporate tax rates

 Firstpost spoke to industry leaders and several economists to understand what are the right kind of expectations to nurture in the upcoming Budget given that it will be the last one presented before elections in 2014.

While most experts believe that reigning in the twin deficits will be the FM’s top priority, Chidambaram faces the challenges of trying to increase investments when domestic interest rates have to be cut and foreign funds have to be somehow enticed to bring in dollars.

On the fiscal front, the government needs to solve the problems of both revenue and expenditure. And this can only be done if the budget includes steps to raise government revenues from direct taxes as well as indirect taxes.

Watch the video above to see what they have to say...

Firstpost encourages open discussion and debate, but please adhere to the rules below, before posting. Comments that are found to be in violation of any one or more of the guidelines will be automatically deleted:

Personal attacks/name calling will not be tolerated. This applies to comments directed at the author, other commenters and other politicians/public figures

Please do not post comments that target a specific community, caste, nationality or religion.

While you do not have to use your real name, any commenters using any Firstpost writer's name will be deleted, and the commenter banned from participating in any future discussions.

Comments will be moderated for abusive and offensive language.

Please read our comments and moderation policy before posting

x