Budget 2013 verdict: Taxes, growth, markets

Was the Budget2013 much ado about nothing? While Finance Minister P Chidambaram failed to cheer the markets and the super-rich, some feel that he stuck to the basics and kept it simple. Firstpost columnists Vivek Kaul and Arjun Parthasarathy, and editors R Jagannathan_,_ Saurav Majumdar, and Venky Vembu discussed the budget in a Google Hangout yesterday. Following is a summary of the debate. [caption id=“attachment_645357” align=“alignleft” width=“380”] The lack of any mention about the equity markets could have likely triggered the massive sell off. AFP[/caption] While our panelists unanimously agreed that the numbers did not add up, they also conceded that people expect way too much from Chidambaram. According to R Jagannathan, editor, Firstpost, the FM avoided the fat and fries that makes everyone happy. People expected way too much from this budget since it was Chidambaram, whereas he decided to stick to the script and play with a straight bat. Sourav Majumdar agreed and said the Chidambaram has been a responsible FM for the first time and the market’s reaction is a bit too harsh on him. He said that although corporate India and the markets were expecting more from him, it was a good budget because he did surprise the market with some measures by reducing the STT. Vivek Kaul maintained that only time will tell how responsible the budget is but said the numbers did not add up. He said the subsidies have been underestimated which could be a problem. The home loan exemption, he noted, was rubbish because one won’t be able to buy a house for 25 lakhs in any of the major cities or even some of the smaller cities. The lack of any mention about the equity markets could have likely triggered the massive sell off, according to Arjun Parthasarathy. He said the markets were expecting a lower gross and net borrowing. The sell off in the equity markets were probably because of the expiry of February series. The  surcharge on corporate taxes is bad for any market. However, he said the  FM is doing all he can to woo FIIs. Venky Vembu, meanwhile, was of the opinion that the budget has raised more questions than answers. Watch the entire debate here.