Union Budget 2013-14 _Apr-Mar

8/22/2019 Union Budget 2013-14 _Apr-Mar

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Union Budget2013-14 (Apr-Mar)

-NewsWire18 Ltd.


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Dear Sir/Madam,

It gives us great pleasure to present you ready reckoner of Union Budget for 2013-14 (Apr-Mar)

presented by Finance Minister P. Chidambaram in Lok Sabha today.The live coverage of the budget, its impact and real-time information on financial markets is exclusivelyavailable to our clients through NewsWire18 Workstation.

Please refer NW18 workstation for news, views and analyses by market experts on the Budget.

Please feel free to call us for any clarifications.

Thanks & Best Regards,

C.B.Divahar

9381324605


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NW18: Highlights of Union Budget for 2013-14

NewsWire18, Thursday, Feb 28

NEW DELHI - Highlights of the Union Budget for 2013-14 (Apr-Mar) presented by Finance Minister P.

Chidambaram in the Lok Sabha today:.

FISCAL ESTIMATES

* FY14 total spend pegged 16.65 trln rupees

* FY14 total Plan spend pegged 5.55 trln rupees

* FY14 Plan spend 29.4% more than FY13 revised estimates

* FY14 non-Plan expenditure estimated 11.09 trln rupees

* FY14 gross market borrowing seen at 6.29 trln rupees

* FY14 net market borrowing seen at 4.84 trln rupees

* FY14 fiscal deficit projected at 4.8% of GDP

* FY14 revenue deficit projected at 3.3% of GDP* FY14 total capital receipts seen at 6.09 trln rupees

* FY14 excise revenue pegged at 1.975 trln rupees

* FY14 divestment mop-up aim at 400 bln rupees

* FY14 divest mop-up in non-government cos seen 140 bln rupee

* Pegs FY14 customs duty collection at 1.87 trln rupees

* FY14 svc tax revenue pegged at 1.80 trln rupees

* FY14 non-tax revenue pegged at 1.72 trln rupees

* FY14 short-term borrowing pegged 198.4 bln rupee

* FY14 gilt redemptions seen at 1.45 trln rupees

* FY14 nominal GDP growth pegged 13.4%

* Pegs FY14 gross tax revenue at 12.36 trln rupees

* Pegs FY14 corporate tax revenue at 4.195 trln rupees

* Kept 500 bln rupees for gilt buyback/switch

* Gilt buyback/switches for better debt management

* Miscellaneous capital receipts pegged 558.14 bln rupee

* FY14 total non-debt receipts pegged 664.68 bln rupee

* Net MSS receipts pegged 200 bln rupees

* FY14 external assistance pegged 105.6 bln rupee

* FY14 small savings receipt seen at 57.98 bln rupees

* FY14 recovery from loans, advances seen 106.54 bln rupees

* Transfer to state, union territories 5.87 trln rupees in FY14

* FY14 total subsidy seen 2.31 trln rupees

* FY14 petroleum subsidy seen 650 bln rupees* FY14 food subsidy seen 900 bln rupees

* FY14 fertiliser subsidy seen 660 bln rupees

* FY15 fiscal deficit pegged at 4.2%; 3.6% in FY16

* Need to bring down fiscal deficit to 3% by FY17


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* Need to bring down revenue deficit to 1.5% by FY17

* Need to have zero effective revenue deficit FY17

* Economic space constrained by high fiscal gap

* Economic space constraints on low saving, tight RBI policy

* Fiscal consolidation can't be done only by spend cuts* Faced with huge fiscal gap, no choice but curtail spend

* Gross domestic savings down 6% in FY12

* Private sector remains main contributor to savings

.

ALLOCATIONS

* FY14 defence allocation 2.03 trln rupees

* 867.4 bln rupees in FY14 for defence CAPEX

* To allot 62.7 bln rupees to science, technology ministry

* To allocate 39.83 bln rupees for high school education scheme

* 58.8 bln rupees for Department of Atomic Energy* To allot 56.15 bln rupees to Department of Space

* To allot 801.9 bln rupees for UPA flagship schemes FY14

* 330 bln rupees for rural employment scheme

* Allocate 415.61 bln rupees for Scheduled Castes sub-plan

* Gender budget allot 971.34 bln rupees FY14

* Allotment to minority ministry 35.11 bln rupees FY14

* To allot more 2 bln rupee to child, women welfare ministry

* To allot 373.3 bln rupees for health, family welfare

* To allot 1.1 bln rupees to disability dept FY14

* To allot 47.27 bln rupees for medical training & research

* To allot 658.67 bln rupees to human resource ministry

* 212.39 bln rupees in FY14 for new national health mission

* Allot 16.5 bln rupees to 6 AIIMS-like institutes

* FY14 for new national health mission allocation up 24%

* To allot 272.58 bln rupees for Sarva Shiksha scheme

* 132.15 bln rupees for mid-day meal scheme FY14

* To allot 245.98 bln rupees to the tribal sub-plan

* To allot 772.36 bln rupees to child budget FY14

* Allot for girl child development plan 52.84 bln rupees

* To allot 177 bln rupees for child development scheme

* Allocation for HRD 17% over FY13 revised estimate

* To allot 152.6 bln rupees for drinking water, sanitation

* 14 bln rupees for water purification plans FY14* To allot 151.84 bln rupees for Indira Awas scheme

* Rural guarantee plan allocation hiked to 330 bln rupees

* Allocates 148.73 bln rupees Nehru urban renewal mission

* PMGSY allocation for FY14 at 217 bln rupees


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* 1.5 bln rupees for healthcare plan for elderly

* To give 10 bln rupees to skill development fund for youth

* 115 bln rupees for backward regions grant fund FY14

* Allot 10 bln rupees for 'Nirbhaya' women safety fund

* To provide 2.5 bln rupees for sports university at Patiala* Allot 2.5 bln rupee to sports coaching institute over 3 yr

* Grant 1 bln rupee each to four universities

* 1 bln rupee grant each to Aligarh, Banaras universities

* Allocate 1 bln rupee grant to TISS, Guwahati

* To allot 3 bln rupees for mother, child nutrition plan

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FY13 REVISED

* FY13 net short-term borrowing revised to 457 bln rupees

* FY13 fiscal deficit estimate revised to 5.2% of GDP

* FY13 divestment mop-up seen 240 bln rupees* FY13 gross market borrowing seen at 5.58 trln rupees

* FY13 petroleum subsidy seen 969 bln rupees

* FY13 food subsidy seen 850 bln rupees

* FY13 fertiliser subsidy seen 660 bln rupees

* FY13 Plan expenditure was too ambitious

* FY13 non-Plan expenditure too conservative

* FY13 effective revenue gap revised to 2.7% of GDP vs 1.8%

* FY13 revenue gap revised to 3.9% of GDP vs 3.4%

* 12th Plan total expenditure revised to 14.31 trln rupees

* FY13 Plan spend too ambitious, non-Plan too conservative

.

DIRECT TAX

* Little room to raise tax rates in constrained economy

* No case to revise either tax slabs or rates

* Personal income tax slabs unchanged FY14

* Direct tax proposals to yield 133 bln rupees in FY14

* Some relief to tax payers in 200,000-500,000 bracket

* Tax credit of 2,000 rupees for income of 500,000 rupees

* Surcharge of 10% on people with income over 10 mln rupees

* Surcharge on high income tax payers only for one year

* 10% surcharge on cos with income above 100 mln rupees

* 5-10% surcharge on local co with income over 100 mln rupee* Only 42,800 tax payers with income over 10 mln rupees

* Education cess to continue at 3%

* Dividend distribution surcharge raised to 10% vs 5%

* Donation to national children fund to get 100% tax relief


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* Income Tax Sec 90, 90A amendment from assessment 2013-14

* Tax residency paper not sufficient to claim DTAA benefit

* To amend Income Tax Sec 90, 90A relating to tax residency

* 25% tax on technical svc royalty, fee to foreign co vs 10%

* 20% tax on profit shared by unlisted cos via shr buyback* Income Tax pass through to some alternative invest funds

* Income Tax pass through to some angel investor funds

* 25% tax on Securitisation Trust income distribution to HUF

* 25% tax on Securitisation Trust income given to individual

* 30% tax on Securitisation Trust income distribution to cos

* Securitisation Trust exempt from income tax

* Tax on interest paid to NRI in long-term infra bond cut

* 5% tax on interest paid to NRI in long-term infra bonds

* No tax on distribution of dividend from foreign subsidiary

* Foreign subsidiary dividend to continue to attract 15% tax

* Transaction tax of 0.01% on non-farm commodities futures* Commodity Transaction Tax on non-farm derivatives trade

* Transaction tax on equity futures cut to 0.01% vs 0.017%

* Transaction tax on MF, ETF redemption cut to 0.001%

* 100% tax deduction for donation to national children fund

* 1% TDS on immovable property transfer of over 5 mln rupees

* Agricultural land exempt from TDS on property deals

* 20% withholding tax on profits distributed by unlisted cos

* Royalty to overseas parents to attract 25% tax vs 10%

* Tax holiday for power plants extended to Mar 2014

* Sops for power projects to continue for 1 year

* 15% tax on dividend from overseas arms to continue

* No income tax on investor protection fund of depositaries

* Financial institutions securitisation trust exempted from tax

* Tax on interest from rupee infra bonds cut to 5% vs 20%

* Non-tax sop to MSME to stay for 3 years post move to higher class

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INDIRECT TAX

* No change in standard rate of excise duty

* No change in peak basic custom duty rate on non-agri goods

* No change in standard rate of service tax

* Indirect tax proposals to yield 47 bln rupee FY14

* Customs duty on leather making machine cut to 5.0% vs 7.5%* To up specific excise duty on all cigarettes by 18%

* 18% hike in excise duty on cigar, cheroot, cigarillo

* To impose service tax on all air-conditioned restaurants

* Sops for low-cost housing to continue


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* Films exhibited in cinema halls to pay no service tax

* Moots voluntary compliance encouragement plan for svc tax

* Vocational courses exempt from service tax

* Coir, jute handmade carpets exempt from excise duty

* Farm produce testing service included in negative list* Export duty on rice bran oil, oil cakes withdrawn

* To up import duty on set-top boxes to 10% from 5%

* Cut custom duty on leather footware machines to 5% vs 7.5%

* Import duty on raw silk to be raised to 15% from 5%

* 10% export duty on unprocessed ilmenite

* 2% customs duty on bituminous coal

* To up import duty on luxury cars to 100% from 75%

* Excise duty on some SUVs raised to 30% from 27%

* To raise excise duty on non-taxi SUVs to 30%

* Excise duty on truck chassis cut to 13% from 14%

* Excise duty hike on SUVs not for vehicles used as taxis* Extends sops on some electric, hybrid vehicle part by 1 yr

* To provide certain concessions to aircraft MRO industry

* Import duty on yachts raised to 25% from 10% now

* Ships, vessels exempted from excise duty

* No countervailing duty on imported ships, vessels

* Duty on 800CC and above motorcycles raised to 75% vs 60%

* Zero excise duty on cotton at fibre stage

* Female passengers can get 100,000 rupee duty-free gold

* Male passengers can get duty-free gold worth 50,000 rupees

* To up duty on mobile phones above 2,000 rupees to 6%

* No change in mobile phone excise duty up to 2,000 rupees

* Excise duty on marble hiked to 60 rupee/sq mtr vs 30 rupee

* Basic customs duty on dehulled oatgrains cut to 15%

* No change in 10% basic customs duty on non-farm pdts

* Interest subvention on crop loans extended to pvt banks

* 5% duty on export of upgraded ilmenite

* Basic customs duty on steam coal increased to 2%

* Basic customs duty on textile machinery, parts cut to 5%

* Basic customs duty on hazelnut cut to 10% from 30%

* 10% export duty on de-oiled rice bran oil cake withdrawn

* Import duty on 800cc and above motorcycle raised to 75%

* Customs on stainless steel wire cloth stripe cut to 5%

* 4% excise duty levied on silver made of zinc/lead smelting* Exempted some galvanized steel sheet from export duty

* Zero-excise duty route restored for branded readymade garment

* Customs on pre-form precious, semi-precious stone cut to 2%

* Two additions to service tax negative list


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* Include vocational courses in negative list

.

TAX REFORMS

* Work on Direct Taxes Code in progress* To introduce DTC bill before end of Budget session

* To incorporate Jan decisions on anti-tax avoidance rule

* GAAR modified provisions seen effective Apr 1, 2016

* To set up tax administration reform commission

* Need for state and central governments to pass a GST law

* Allocates 90 bln rupee as CST compensation to states

* Draft bill on GST in Parliament in next few months

* To encourage voluntary compliance to boost svc tax collection

* One-time amnesty scheme for service tax due from 2007

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GROWTH, INFLATION

* Final FY13 GDP growth rate would be lower than CSO, RBI view

* CSO estimated FY13 GDP growth at 5%

* RBI estimated GDP growth at 5.5% FY13

* Overall GDP growth rate seen at 6.1-6.7% in FY14

* Global econ growth slowed to 3.2% in FY12 from 3.9% FY11

* Challenge to achieve trend growth rate of 8%

* Only China to grow faster than India in FY14

* Average GDP growth of 8% in 11th Plan

* Growth is highest goal

* Achieving high growth not beyond our capacity

* No development, inclusiveness without high growth

* Can achieve faster growth rates as seen earlier

* Growth a necessary condition for development

* We have achieved high growth before, can do it again

* UPA govt believes in inclusive development

* India can become 7th largest economy by 2017

* Can become $5 trln economy by 2025

* Hope FY14 Budget will be testimony to inclusive growth

* Global crisis spared none

* India not unaffected by what is happening in rest of world

* There is no reason for gloom or pessimism

* Battle against inflation must be fought on all fronts* Food inflation is worrying

* Govt spend is both good, bad from inflation perspective

* No choice but to rationalise spending

* Govt expenditure boosts aggregate demand


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* Need to augment supply side to fight food inflation

* Oilseed, pulses supply-demand mismatch pushes up inflation

* Efforts over last few mos brought dn WPI inflation to 7%

* Efforts in last few mos brought dn core inflation to 4.5%

.EXTERNAL SECTOR

* Current account gap is greater worry

* Current account deficit high on gold, coal imports

* Current account deficit high on oil imports

* Need $75 bln to finance current acct gap over next 2 yrs

* Exports, imports amount to 43% of GDP

* Reliance on FX inflows to fund current acct deficit

.

FINANCIAL SECTOR

* To introduce investment allowance for high value invest

* To introduce 15% investment allowance to attract invest

* Rajiv equity plan to be eased; to cover MF investments

* Rajiv Gandhi equity plan invest cap up by 200,000 rupee

* 15% deduction for invest up to 1 bln rupee till FY15

* Expect to raise 250 bln rupees via tax-free bonds FY13

* Pvt sector infra investment seen 47% in 12th plan

* To allow some institutions to issue tax-free bonds FY14

* To OK 500 bln rupee tax-free bonds in FY14

* To encourage infra debt funds to boost infra growth

* PSU bks well regulated, must be adequately capitalised

* 140 bln rupees to PSU banks for recapitalisation FY14

* Will ensure PSU banks always meet Basel III norms

* Gave 125 bln rupees to PSU bks for recapitalisation FY13

* PSU banks assured all branches to have ATMs by Mar 2014

* Plan to set up exclusive bank for women

* Plan council for intl competitiveness of fincl sector

* To provide 10 bln rupees initial capital for women's bk

* To allot 60 bln rupees for rural housing fund under NHB

* License to women bank by Oct 2013

* 20 bln rupee allocation to create urban housing fund

* NHB to set up urban housing fund

* KYC of banks sufficient for insurance policies* Insurance cos can open Tier 2 city branch without IRDA nod

* Banking correspondence can sell micro-insurance pdts

* Towns with 10,000 people to have LIC, GIC offices

* Inflation indexed bonds to be introduced


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* To launch inflation-indexed certificates

* To introduce inflation linked instruments

* Scope of Rashtriya Swasthya Bima Yojana to be expanded

* Hope insurance, PFRDA bill will be passed in this session

* India capital market best regulated* OK to FII to trade in exchange traded FX derivatives

* SEBI to ease norms for foreign portfolio investment

* Allow FIIs to use corporate bond income for margin need

* SMEs will be allowed to be listed without IPO

* FII status for investment less than 10% in a company

* FDI status for investment over 10% in a company

* Distributors can become members of exchanges' MF segment

* Stock Exchanges to have dedicated debt segment

* MF distributors allowed to become stock exchange members

* Insurance, pension cos can directly trade in debt segment

* Exchanges can introduce dedicated debt segment* ETFs will be eligible for pension, insurance investment

* Post offices to move to core banking solutions

* 5.3 bln rupees to post offices for core banking solution

* Need to encourage foreign investment

* India doesn't have choice between FII and FDI

* Foreign investment is an imperative

* To remove distrust in minds of investors

* Will improve communication of our policies to investors

* Doing business in India should seem mutually beneficial

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FARM SECTOR

* FY14 farm credit target 7 trln rupees

* To allot 270.49 bln rupees for agri ministry FY14

* To allot 34.15 bln rupees for agri research

* Food security bill a promise of UPA govt

* Farm credit will top FY13 target of 5.75 trln rupees

* Interest subvention for short-term farm loans to continue

* Farm loan Interest subvention Plan to continue

* Farmers who repay loan on time will get loan at 4%

* To allot 5 bln rupees for crop diversification programme

* To spend 10 bln rupee on green revolution in east India

* Rashtriya Krishi Vikas scheme to get 99.54 bln rupees FY14* Allot 22.5 bln rupees for food security mission

* To allot 53.87 bln rupees for integrated watershed plan

* 11th plan growth in farm sector was 3.6%

* FY13 total food grain output over 250 mln tn


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* Farm exports were 1.384 trln rupees in Apr-Dec

* To allot 50 bln rupees to NABARD for warehouses FY14

* 2 bln rupees for pilot plan for nutri-farms

* To allocate 10 bln rupees to rice-producing East states

* Plant Protection Institute to be set up in Chhattisgarh* Indian Institute of Bio-Technology to be set up at Ranchi

* To launch national livestock mission in FY14

* Allot 750 mln rupee for coconut rejuvenation pilot plan

* To allot 3.07 bln rupees for National livestock mission

* 750 mln rupee more for revival of coconut palm in Kerala

* Allot 100 bln rupees for food security plan FY14

* Credit guarantee fund to be created for small farmers

* 1 bln rupee credit guarantee fund for small farmers

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INFRASTRUCTURE

* IIFCL, ADB to offer credit enhancement for infra cos

* Rural Infra Dev Fund corpus raised to 200 bln rupees

* To set up regulatory authority for road sector

* Road construction facing financial stress

* To set up regulatory body for road sector

* Revival of invest in manufacturing sector a key challenge

* 30 bln rupee road projects to be awarded in Apr-Sep

* To allot 148.73 bln rupees for Jawaharlal Nehru urban plan

* To use bulk of Nehru urban renewal plan for buying buses

* To buy 10,000 buses from fund of Nehru urban renewal plan

* Infra debt funds to be encouraged

* 12th plan projects $1 trln for infra invest

* 1.51 trln rupees for textile upgradation fund 12th Plan

* Allocates 500 mln rupees to set up apparel parks

* 960 mln rupees for interest subvention in textile FY14

* Loans at 6% rate for women textile entrepreneurs

* Assure support to commerce ministry to boost exports

* Initial work on Chennai-Bengaluru corridor started

* To give Delhi-Mumbai corridor more funds if needed

* To set up 2 new ports at Andhra Pradesh, West Bengal

* 2 ports at Andhra, W Bengal to add 100 mln tn capacity

* To have Bengaluru-Mumbai Industrial corridor

* Plan grid connecting waterways, roads, ports* Delhi-Mumbai Industrial Project has made rapid progress

* Work on 2 new smart industrial cities will start FY14

* Oil, gas policy to move to revenue sharing model

* Natural gas pricing policy to be reviewed


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* Natural gas policy will be reviewed

* To announce policy on Shale gas exploration

* Shale gas projects to be encouraged

* To move oil E&P pacts to revenue sharing from profit sharing

* Must reduce dependence on imported coal* 5 mtpa LNG terminal to be fully operational in FY14

* Coal import estimated to rise to 185 mln tn by FY17

* To cut dependence on coal import in medium-, long-term

* States must prepare plans immediately for power distribution cos

* Urge state govts to approve recast of electricity boards

* To give 5 bln rupee to SIDBI for factoring loan guarantee

* To double SIDBI's refinance capacity to 100 bln rupees

* Textile tech upgrade scheme to get 24 bln rupees FY14

* Additional tax sop for first time home owners

* Up to 2.5 mln rupee 1st home loan to get more tax cut

* No custom duty for plant, machinery for semi-conductors* Wind energy sector deserves incentives

* Generation-based incentives for wind energy projects

* To expand pvt FM stations to 294 more cities

* 294 more cities to be connected by FM radio

* To auction 839 more radio channels in FY14

* Cities above 100,000 population to have pvt FM channels

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SOCIAL SECTOR

* Giving enough funds to programmes for women, children

* Funds for the sub-funds cannot be diverted

* To create opportunities for youth to get skills for jobs

* To launch new scheme for rural road development

* PM rural road scheme for Andhra, Maharashtra

* PM rural road scheme for Haryana, Rajasthan

* Skilled, trained youth to give enormous boost to economy

* Made modest, cautious start for direct cash transfer Jan 1

* Direct cash transfer scheme covered 1.1 mln people so far

* Viability gap funds to city bodies for energy from waste

* To cut number of centrally-sponsored plans to 70 vs 173

* Insurance for disabled to have 15% premium rate vs 10% now

* Relaxation on insurance polices for disabled from Apr 1

* State health Plan contributions eligible for tax deduction* Centre health Plan contribution eligible for tax deduction

* Initiatives underway to ensure women security

* To set up national institute of sports coaching.

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First Views on Union Budget 2013-14

NW18: First View: Sobha Developers MD Sharma on FY14 Budget

BENGALURU - J.C. Sharma, vice chairman and managing director, Sobha Developers Ltd, on the Union Budget

for 2013-14 (Apr-Mar), presented in Lok Sabha by Finance Minister P. Chidambaram today.

Finance Minister P. Chidambaram has ensured fiscal deficit would be under control without increasing excise

duty (standard rate) and service tax rates. This shows that the government is focusing more on making sure that it

controls planned and non-planned expenditures, and also ensure that the common man and companies are not

affected.

NW18: First View: YES Bank Chief Economist Shubhada Rao on FY14 Budget

KOLKATA - Shubhada Rao, chief economist, YES bank, on the Union Budget for 2013-14 (Apr-Mar), presented in

the Lok Sabha by Finance Minister P. Chidambaram today.

The finance minister refrained from any big-bang announcements. Many announcements have been made to

discipline subsidies. The gross borrowing number has come out at 6.29 trln rupees and the net is 4.6-4.7 trln after

cutting out redemptions. The number initially is likely to keep the bond market cautious, but one will have to wait

more to see its actual impact.

Key highlights of the Budget include investment allowance of 15% on investment up to 1 bln rupees, inducing

financial savings and schemes in health and education sector.

Chidambaram's emphasis on infrastructure funding needs and announcements such as public-private partnership

with Coal India are positive.

Chidambaram has levied a surcharge on the rich and increased some of the indirect taxes, but those are not seen as

inflationary.

He has tried to cut back subsidies. It looks like that diesel prices will be revised throughout the year.

The fiscal deficit aim of 4.8% of GDP in 2013-14 is doable if disinvestment kick-starts in the beginning of the year

and not left to the second half.

On the whole, Chidambaram has refrained from populism and announced a balanced, pragmatic and a rational

budget.


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NW18: First View: SBI Chief Economist Brinda Jagirdar on FY14 Budget

KOLKATA - Brinda Jagirdar, chief economist, State Bank of India, on the Union Budget for 2013-14 (Apr-Mar),

presented in Lok Sabha by Finance Minister P. Chidambaram today.

It is a prudent and balanced budget according to me. Chidambaram has addressed the need of different sectors

and different regions. He has focused a lot on the financial markets and incentives to attract household

savings into the housing sector. The move for introducing inflation indexed bonds is welcome. Also,

Chidambaram announced some benefits for home loans which are likely to lead to a pick-up in banks' credit

growth. It would even help growth as a whole because an improvement in housing sector will definitely help a lot

of other sectors such as your cement and steel sector.

He also focussed a lot on education and skill development schemes and has announced reform measures for

infrastructure, SME, agriculture, manufacturing.

The PSU banks' funding infusion may improve banks' lending going forward and helping growth.In taxes also, I think, he had a good balance and it does look like the DTC and the GST will come soon.

On the borrowing side, the numbers seem to be a little worrisome for the bond market and are likely to push

yields higher.

He also seems to have delivered on the fiscal consolidation front and the fiscal deficit target for the next year

seems quite achievable if disinvestments proceed smoothly.

NW18: First View: PM econ panel head Rangarajan on FY14 Budget

NEW DELHI - C. Rangarajan, chairman, Prime Minister's economic advisory council, said the following to CNBC-

TV18 on the Union Budget for 2013-14 (Apr-Mar), presented in Lok Sabha by Finance Minister P. Chidambaram

today.

He (Finance Minister Chidambaram) has done something to provide some incentives for additional savings and

more particularly, he has done something to revive the investment sentiment. He has indicated a number of

measures both in real terms as well as in terms of the financial sector reforms. All of this will contribute to the

improvement in the investment picture.

I certainly believe that the rate of growth in the economy in the coming fiscal (2013-14) will be at least 1% or 1.5%

higher than what we are seeing in the current year. We must take into account also whatever actions government

has taken in the recent period. It has revived the investment sentiment and you will see the full impact of the

change in the sentiment during the course of the fiscal and the Budget has only strengthened the sentiment.

There is nothing in the Budget, which will really make it weaker. So, combined with what he has said today and

combined with what measures they have taken since September, we should see a pick up in the growth rate in the

coming fiscal.


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NW18: First View: HCL Infosystems CEO Chitale on Union Budget 2013-14

NEW DELHI - Harsh Chitale, chief executive officer, HCL Infosystems Ltd, on the Union Budget for 2013-14 (Apr-Mar), presented in Lok Sabha by Finance Minister P. Chidambaram today.

It was more or less a non-event. I mean everything remained just same, which need not be bad. He (Finance

Minister P. Chidambaram) didn't incur too much with taxes, duties, indirect taxes and what industry needed was

stability. Nobody expected any changes on taxes and duties and sops they didn't come. Everybody expected

impetus on food security bill and extra thrust on social programmes. Taxes on rich and luxury good was also more

or less expected.

Where something could have been done more and I think opportunity has been missed was some concrete actions

around kick-starting investments because in our country investment rate has gone down.

There was nothing for the information technology industry, I didn't see anything, but it's not necessarily negativeeither.

NW18: First View: ICAP, head-India FX and Option Bhalotia on FY14 Budget

MUMBAI - Anil Bhalotia, head of India FX and Option, ICAP, on the Union Budget for 2013-14 (Apr-Mar),


I think it is a very realistic and pragmatic budget. Under the circumstances, the finance minister could not have

done anything better. What I liked is that he increased the planned expenditure, which is an excellent sign. It

shows that the government is working very seriously on the growth side and they really want domestic growth to

pick up.

I think the silver lining in the budget is the increase in the planned expenditure, and the gradual reduction target

for the fiscal deficit to 4.8% in the next financial year. Another positive is his ability to bring fiscal deficit to 5.2% in

the current fiscal year.

I think all the foreign investors are going to like it.

Overall, I think the budget is fantastic. I think the market should rally. I think the rupee will come up. I see rupee

in the range of 53.00-54.50 a dollar until the next two months. 10-year government bond yields will remain in the

range of 7.80-7.90%.

.

NW18: First View: SBI MF chief investment officer Munot on FY14 Budget

MUMBAI - Navneet Munot, chief investment officer, SBI Mutual Fund, on the Union Budget for 2013-14 (Apr-

Mar), presented in the Lok Sabha by Finance Minister P. Chidambaram today.


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Nothing has come out for the mutual fund industry from the budget. Rajiv Gandhi Equity Savings Scheme income

limit has been raised to 12 lakh rupees (1.2 mln), which will not help get more money. Mutual fund distributors

have been allowed to become members of stock exchanges, but I don't know how many will be willing to become

members.

We were expecting a lot of measures for the revival of the industry, and also to revive fortunes of the industry.Measures have fallen short of our expectations.

We hope those measures will be taken by policy makers in the coming months.

NW18: First View: IVRCL CMD Reddy on FY14 Budget

HYDERABAD - E. Sudhir Reddy, chairman and managing director, IVRCL Ltd, on the Union Budget for 2013-14

(Apr-Mar), presented in Lok Sabha by Finance Minister P. Chidambaram today.

I think the finance minister has done well considering the current global and domestic economic conditions. It

seems he has recognised the problems in the infrastructure sector.

There are certain positive elements in the Budget such as encouragement for infrastructure debt funds andappointment of regulator for roads.

However, we need to see the fine print of the proposals for debt funds.

The government could have come out with very specific information on these funds.

The duties and functions of the road regulator are important things to watch out for, but we cannot say for now if

the regulator will be helpful to us. Surcharge on individuals' earnings above 10 mln rupees, and companies'

earning over 100 mln rupees are somewhat negative. I don't know how much money the government is going to

collect with these kind of decisions. It is a bit of de-motivation when some motivation was needed.

NW18: First View: Oriental Bank of Commerce CMD Bansal on FY14 Budget

MUMBAI - S.L. Bansal, chairman and managing director, Oriental Bank of Commerce, on the Union Budget for

2013-14 (Apr-Mar), presented in the Lok Sabha by Finance Minister P. Chidambaram today.

Overall, the budget is a good plan as the fiscal deficit projections are credible. However, it is still not clear how the

projections will be achieved.

Contrary to fears, there were no political gimmicks and the focus was clearly on fiscal consolidation.

The 140-bln-rupee capital infusion programme announced for public sector banks was on expected lines. Oriental

Bank is comfortable on capital levels till September as there is not much credit growth.

There is some disappointment that once again the government has chosen not to bring in parity between banks'tax-savings deposits tenure and mutual funds of a similar nature. I guess that he did not reduce the tax-saving

term deposit tenure to three years from five years as the government is also under pressure to ensure funds are

raised for other savings schemes.


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The gross market borrowing number announced has been high, so yields have gone up. This is a knee-jerk

reaction and I don't believe this is an indication of a long-term trend.

NW18: First View: M&M Director Arun Nanda on FY14 Budget

MUMBAI - Arun Nanda, director, Mahindra & Mahindra Ltd, on the Union Budget for 2013-14 (Apr-Mar),


Commercial vehicles are the worst affected segment of the automobile industry, so any relief there is good.

Reduction in duty on chassis is significant as these are a big component of commercial vehicles. This is a

welcome step.

Most of Mahindra & Mahindra's sport utility vehicles are sold for use in commercial fleets. So today's move is

favourable for the company, as SUV sales for commercial use have not been taxed incrementally.

NW18: First View: Andhra Bank's Venkatasubramanian on FY14 Budget

MUMBAI - S.V.V. Venkatasubramanian, treasury head, Andhra Bank, on the Union Budget for 2013-14 (Apr-Mar),


Capital infusion for public sector banks is definitely a good feature. In spite of more demand for populist

measures, the government still has maintained a fiscal deficit (aim) of 4.8% for 2013-14 (Apr-Mar). The budget

seems a plus for the infrastructure sector. Certain expectations have not come through, but overall, it should be a

good budget in the current scenario.

NW18: First View: Bharti Institute-ISB ED Chakrabarti on FY14 Budget

HYDERABAD - Rajesh Chakrabarti, executive director, Bharti Institute of Public Policy-ISB, on the Union Budget

for 2013-14 (Apr-Mar), presented in Lok Sabha by Finance Minister P.Chidambaram today.

Overall it's a quite reasonable budget, given the macro constraints. The slant was on pro-disadvantaged, with all

the right noises made, some material some cosmetic. The former includes the move of extending SME (small

and medium enterprise) benefits for 3 years after exiting the sector, as well as the monetary reward for skill

development.

The women's bank falls in the trick category. Commodities transaction tax will affect commodity markets, but

probably was unavoidable.

The focus on infrastructure is well-chosen as well as the emphasis on debt instruments to fund it. The adequacy

and effectiveness of the steps taken will, of course, remain to be seen.

The promise to roll-out of direct benefits transfer in the next year seems unrealistic.


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NW18: First View: Bank of Nova Scotia treasurer Natarajan on FY14 Budget

MUMBAI - M. Natarajan, treasury head, Bank of Nova Scotia, on the Union Budget for 2013-14 (Apr-Mar)


Although I am slightly disappointed that no radical steps have been taken for capital markets or to spur

investments, some tinkering has been done to tax structures and increase in customs duty of luxury vehicles etc.

But they are largely doses of incremental taxes. It is more demonstrative, I would say, rather than resulting in any

meaningful revenue.

As for the rates segment and to what matters to us bankers, we need to wait for the actual government borrowing

programme, cut in rates etc. Borrowing seems to be slightly higher, but I won't say it's out of the comfort zone.

Firstly, I was expecting it and then market was expecting overall lower borrowing programme as well. So to that

extent, market is also playing safe. Overnight indexed swap rates have gone slightly higher and 10-year

government securities have also gone up. On the whole, it's positive and there was mention about curbingexpenditure, commitment to growth, containing inflation. But if the government definitely walks the talk,

then there is scope for the Reserve Bank of India to ease policy rates. Because, the RBI believes in what actually

happens as opposed to what statements are made.

So the budget is overall...nothing exciting. It's sort of boring in fact.

But the finance minister is not expected to be an entertainer. He has to address larger sections. One word to

explain the budget could be an 'unexpected non-event'.

NW18: First View: CARE Ratings Chief Economist Sabnavis on FY14 Budget

KOLKATA - Madan Sabnavis, chief economist, CARE Ratings, on the Union Budget for 2013-14 (Apr-Mar),


It is a conservative Budget and is more or less on expected lines. Chidambaram has focussed more on

development, growth and cutting expenditure, which is the need of the hour. The development is more focussed

in the social sector. We are expecting the GDP for FY14 to be somewhere between 6.5% and 7%.

In terms of markets and tax, the market was expecting some more benefit in terms of corporate tax. He has

indicated that he is going to curb expenditure and improve revenue.

The move that he has taken on indirect taxes is largely on expected lines. Coming to the borrowing, the net

borrowing is too different from last year. On a gross basis it is more but there are a lot of redemptions lined up

this year so, it should be a big cause of worry for the bond market. Also, with the economic growth and creditgrowth not seen very good, banks would park their money in government bonds.

On subsidies, he has taken a pragmatic view. Fiscal deficit of 4.8% is likely to be achieved provided growth takes

place.


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NW18: First View: Tata Chemicals MD Mukundan on FY14 Budget

MUMBAI - R. Mukundan, managing director, Tata Chemicals Ltd, on the Union Budget for 2013-14 (Apr-Mar),presented in Lok Sabha by Finance Minister P. Chidambaram today.

The Budget addresses many concerns and clarifies many ambiguities. Clarity on taxation of steam coal and

bituminous coal is particularly appreciated as there was some confusion on taxation for companies running

captive power plants.

The Budget lays down a clear road map for supporting small and medium enterprises. Support for infrastructure

projects is also welcome. The industry is eagerly awaiting the rollout of Goods and Services Tax, and the Budget

speech has articulated the government's intent on this matter.

NW18: First View: PNB Gilts Managing Director Dubey on FY14 Budget

MUMBAI - S.K. Dubey, managing director, PNB Gilts Ltd, on the Union Budget for 2013-14 (Apr-Mar), presented

in Lok Sabha by Finance Minister P. Chidambaram today.

What the government bond market was looking forward to was 'everything positive'. People had expected a lot of

positive news in terms of reviving investment, but that has not come. The Budget is quite neutral. Since so many

positive expectations were built in, bonds have reacted negatively.

If you see, the net market borrowing is broadly in the same range as 2012-13 (Apr-Mar). So it not that negative for

the market. The buyback is not such a negative for portfolio duration. If you see, the weighted average duration

for quite some time has been around 13 years. Market will take some time in understanding these things.

NW18: First View: DEN Networks COO Mohammad Ghulam Azhar on FY14 Budget

NEW DELHI - Mohammad Ghulam Azhar, chief operating officer, DEN Networks Ltd, on the Union Budget for

2013-14 (Apr-Mar), presented in Lok Sabha by Finance Minister P. Chidambaram today.

The proposal in the budget for increasing the import duty on set-top boxes to 10% from the existing 5% would

compel us to pass on the additional cost to subscribers.

We were expecting cut of 5%, which would have facilitated the ongoing cable digitisation process in the country.

Going forward, in the coming years, we would like our inventory to have a mix of both domestic and importedset-top boxes. The hike in import duty has been done to encourage the domestic manufacturing of set-top boxes.

However, there are no notable manufacturers of set-top boxes in the country at present.


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NW18: First View: South Indian Bank's Treasurer Murali on FY14 Budget

MUMBAI - Murali N.A., treasury head, South Indian Bank, on the Union Budget for 2013-14 (Apr-Mar), presented

in Lok Sabha by Finance Minister P. Chidambaram today.

Gross domestic product is seen growing 6.7% in 2013-14 (Apr-Mar), and fiscal deficit target has been brought

down from 5.2% in 2012-13 to 4.8% for 2013-14, which shows fiscal health is improving much more than in the

past.

Going forward also, the fiscal deficit is projected to come down. There is no major hike in direct or indirect taxes.

Finance Minister has acknowledged that current account deficit is a big worry. There will be more encouragement

for foreign flows by way of foreign institutional inflows, foreign direct investment and external commercial

borrowings.

FII regulations are proposed to be made simple to facilitate more number of FIIs coming to India. FII participation

in the foreign exchange segment is also a positive action. Good fiscal health and more FII flows should liftsentiment in the stock market and be positive for the rupee.

NW18: First View: HDFC Life CEO Chaudhry on FY14 Budget

MUMBAI - Amitabh Chaudhry, managing director and chief executive officer, HDFC Life, on the Union Budget

for 2013-14 (Apr-Mar), presented in the Lok Sabha by Finance Minister P. Chidambaram today.

This budget reflects a tight ropewalk by the finance minister given that he has to bring back investor confidence,

and spur investments and growth as this might be the last full budget prior to general elections.

The budget is a responsible and pragmatic one with several initiatives that should spur growth. A number of

measures for financial and capital markets are a step in right direction.

With respect to the life insurance sector, he introduced several positive measures that would aid growth including

a clear hope on passing of the insurance and pension bills.

NW18: First View: Tata Steel Group CFO Koushik Chatterjee on FY14 Budget

MUMBAI - Koushik Chatterjee, group chief finance officer, Tata Steel Ltd on the Union Budget for 2013-14 (Apr-

Mar), presented in Lok Sabha by Finance Minister P. Chidambaram today.

He has balanced the budget very well, which is what is needed. He has pushed up the investment allowance,

raised expectations for small savings receipts. With all this, the finance minister has tried to have a balancedbudget.

For steel sector, there wasn't anything specific but the sector looks at the economy and the market for growth. So

as long as investment is encouraged, I think it is good for the sector as well.


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NW18: First View: Blue Star MD Jamdar on FY14 Budget

MUMBAI - Satish Jamdar, managing director, Blue Star Ltd, on the Union Budget for 2013-14 (Apr-Mar),


I was not hoping for any sops or other major changes in the Budget. We were only hoping for the investment

climate to improve. Chidambaram's problem was that he did not want to tax more so all his effort has gone there.

The divide between rich and poor needs to come down, and so in the long-run his policies are good. But because

he had such less elbow room, he has ended up giving in bits and pieces.

There has not been any investment in the capital goods sector for a long time now, and I don't think the Budget is

going to change that greatly. The investment allowance proposal is good, but the manufacturing sector needs

much more.

Issues relating to land availability, skilled labour, and training need to be addressed.Our manufacturing suffers due to lack of scale, and that is because participation of population is not high. In that

sense, the idea to put money into social schemes to raise standard of living of under-developed areas is right.

Though the step is in the right direction, it may take a long time to show effect.

Chidambaram has followed a simple route--neither do anything, nor take away anything.

NW18: First View: Principal Mutual Fund CIO Jain on FY14 Budget

MUMBAI - Rajat Jain, chief investment officer, Principal Mutual Fund, on the Union Budget for 2013-14 (Apr-


There are no major initiatives, which is not surprising given that it is a pre-election budget. However, the need to

push capital expenditure is recognized with the investment allowance.

The additional deduction of 100,000 rupees for first-time home loan buyers is quite meaningful.

Other than that, the fact that there has not been too much of tinkering with tax rates is positive. Overall, however,

it is not a positive or a negative budget and it is going to be more about execution and hoping that the government

continues to work towards removing bottlenecks in the economy.


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NW18: First View: Angel Broking Chairman Thakkar on FY14 Budget

MUMBAI - Dinesh Thakkar, chairman and managing director, Angel Broking, on the Union Budget for 2013-14(Apr-Mar), presented in Lok Sabha by Finance Minister P. Chidambaram today.

The government's reform momentum had been so strong since September that there were expectations of some

exciting measures in the budget too. That was not the case, but it does not mean the budget was a disappointment.

The finance minister has been seriously committed to bringing down the fiscal deficit, and he has delivered on that

front, as he did not announce any major populist measure and largely maintained stability in tax policies, save for

some tweaking for higher income brackets and companies.

In my view, there were no major positive or negative triggers for the markets or any particular sectors, and I think

what the market will look forward to is the reform agenda being continued by the government outside thebudget, in the coming parliament sessions, for which the momentum still looks very much on track.

NW18: First View: Godrej Group Chairman Adi Godrej on FY14 Budget

NEW DELHI - Adi Godrej, chairman, Godrej Group, and president, Confederation of Indian Industry, on the

Union Budget for 2013-14 (Apr-Mar), presented in Lok Sabha by Finance Minister P. Chidambaram today.

We particularly welcome the containment of the fiscal deficit to 5.2% in the current financial year and to 4.8% in

the next financial year. I think this is a very important development. It will add to gross domestic product

growth, inflation containment. It will ensure that the rating of our economy is strong.

We also generally felt that there was very good emphasis on agriculture especially technological inputs into

agriculture, science, space and some of these areas which could help growth going forward.

Generally, the incentives for investment into the capital markets are welcome, that will divert investment from

gold which has become quite high in the last couple of years and which will also help improve overall investments

into the productive parts of the economy.

I think the tax administration reforms the finance minister suggested are welcome. Currently, there is a lot of

negative perception both globally and in India because of actions taken by the tax authority. The fact that the

GAAR (general anti-avoidance rule) provisions are going to be made into law, provisions that they announced

from the Shome committee through the finance bill are also extremely welcome.


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NW18: First View: IIFCL CMD Goel on FY14 Budget

KOLKATA - S.K. Goel, chairman and managing director, India Infrastructure Finance Co Ltd, on the Union

Budget for 2013-14 (Apr-Mar), presented in Lok Sabha by Finance Minister P. Chidambaram today.

We are very pleased with the steps he has taken for the infrastructure sector and believe that this would increase

the flow of resources in the sector.

The 50,000 crore rupees (500 bln rupees) limit on tax-free infra bonds is very positive; we hope this would help us

garner more resources and disburse more in the next financial year.

The Budget is also encouraging the infrastructure debt funds. We would be finalising partners for our

infrastructure debt fund in a week's time and launch the fund by the end of March. We hope to raise 5500 crorerupees (55 bln rupees) through our first IDF.

Overall, we feel these initiatives would help improve sentiment for the sector and would translate into a lot of new

projects in the next financial year.

NW18: First View: HDFC Bank Economist Jyotinder Kaur on FY14 Budget

KOLKATA - Jyotinder Kaur, economist, HDFC Bank, on the Union Budget for 2013-14 (Apr-Mar), presented in

Lok Sabha by Finance Minister P. Chidambaram today.

Chidambaram has highlighted the right problems but in terms of roadmaps there is no clarity and there is a lot

more that he could have done with respect to boosting growth and investments.

In terms of fiscal consolidation, Chidambaram has delivered and the RBI might now ease its stance going forward.

The surge in bond yields goes to show the high gross borrowing number but with open market operations and

redemptions lined during the year the net borrowing should not be a worry and as soon as the bond market

realises this I think yields will start easing.

In terms of the targets set for FY14, they seem to be more credible than last year.

Subsidies, I still think are a bit unrealistic, although more realistic than last year. Fuel subsidy may be contained

but there are definite risks for food subsidy as the outgo on account of food security is big.


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NW18: First View:Federal Bank President-Treasury Khajuria on FY14 Budget

MUMBAI - Ashutosh Khajuria, president-treasury, Federal Bank, on the Union Budget for 2013-14 (Apr-Mar),


It is a very balanced and I would say quite prudent Budget. No wastages, no extravagance. What could have

happened in a pre-election year Budget, nothing of that sort is there.

This Budget clearly shows the government's commitment to follow fiscal prudence and targeting the fiscal deficit

to 4.8% of the gross domestic product for 2013-14 and also giving a well-defined roadmap on scaling down

fiscal deficit and bringing it back to 3% of GDP.

It is surprising to see the gilts market reacting so negatively to the Budget. The net borrowing for the next fiscal is

pretty much in line with market expectations. In fact, a borrowing number of below 5 trln rupees should have

been welcomed by the market.

NW18: First View: Bank of Maharashtra ED Rajendran on FY14 Budget

MUMBAI - C.V.R. Rajendran, executive director, Bank of Maharashtra, on the Union Budget for 2013-14 (Apr-


This budget must be viewed from the perspective of not just what has happened but also what has not happened.

The budget ensures that each department has additional allocation while tax rates have not been raised despite

cues for increase in taxes in countries like US.

Given the constraints, this is a good budget, as no additional tax burden has been imposed. Despite much debate,

there is no move to introduce a wealth tax on super-rich individuals. All this will have a good impact on the

markets in general.

The gross market borrowing is higher than the expectation of 6 trln rupees, so the market has gone up. However, if

the buyback programme of 500 bln rupees is also accounted for then it comes to the number expected by the

market. When market digests this, the yields will improve.

The announced capital infusion of 140 bln rupees is not enough to helm state-owned banks to meet their Basel III

capital needs, so banks will have to raise money from the markets. Most banks can do this as the government

holding is well above the mandatory 51% requirement.

The all-women bank is an interesting idea, but we need to see how the idea plays out. There are already a large

number of women personnel and women-centric programmes in the banking sector, this is probably aimed atgiving additional priority to women's requirements.

End

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Union Budget 2013-14 _Apr-Mar

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