The Union Budget 2023-24, which is all set to be presented on February?1, is coming at a time when?major economies?across the world?are facing uncertainty and are, as per various agencies, likely to face recession this year. Companies are also resorting to mass layoffs to cut costs?due to economic uncertainties. Amid this, various sectors are expecting support in the upcoming Budget.
The middle class is eagerly awaiting some income tax reforms that would enable them to curtail their tax outgo. Their budget expectations in this regard is very high because this will be the last full budget of the incumbent Narendra Modi-led Read More
Satishwar B, MD & CEO, Aegon Life Insurance, said, “The uptake of life insurance products is increasing. I am sure that more people will include insurance products in their financial portfolios in 2023. Incentives like a GST exemption or a reduced GST slab can further help in meeting the needs of consumers. Pension/annuity proceeds should be made tax-free in the hands of policyholders, or a deduction for the principal component should be allowed. Further, an aggregate deduction of up to Rs 1.75 lakh, for the premiums paid for life and health can be introduced to nurture the eco-system of insurers, insurtechs and consumers.”
Prateek Agrawal, Executive Director, Business & Investment Strategy, Motilal Oswal AMC, said, “The budget is being presented in the backdrop of an expected global slowdown impacting Indian growth. Even domestically, consumer companies are indicating a slowdown after the festival season. Lending a helping hand to the population as it recovers from Covid issues would continue to be the focus. This is the last budget before the elections and while we expect continued focus on nation building and expect to see larger defence allocation given the geopolitical imperatives, it would require a tough balancing act given the focus on reduction of fiscal deficit as per the glide path. The revenue momentum for the government should be expected to slow down given the reduction in both the real economic growth and inflation in FY24 over FY23, making things more difficult.”
Anuj Kumbhat, Founder and CEO of agritech company WRMS, said, “The government needs to enable more technological advancement in the agriculture sector with an acute focus on the development of a complete agritech ecosystem. We hope that in the upcoming budget, the government allocates funds, especially for the improvement of agriculture infrastructure which has a much larger multiplier effect on the economy in the long run.”
Shivendra Nigam, Chief Financial Officer, Cantabil Retail India, said, “The $883 billion Indian retail industry, which has recovered after experiencing a downturn for two years in a row owing to the epidemic, continues to look forward to the government’s unwavering support. We anticipate that the government will prioritise growth-oriented initiatives in this Union Budget to bolster the regional economy and support the growth rate. We also think that the GST should be decreased for goods that demand more manual labour, as this will increase the number of jobs available. This will not only contribute to a higher employment rate but will also strengthen the economy of our nation by allowing people to spend more money.”
Vinod Nair, Head of Research at Geojit Financial Services
Mirroring robust global peers, the domestic market extended previous gains driven by auto stocks. However, due to selling pressure in banking shares, the indices anchored close to the flatline.
Auto stocks were in focus prior to the earnings results of the sector major. Hopes of a soft landing of the US economy along with the anticipation of a lesser rate hike boosted global bourses.
Gaurav Ratnaparkhi, Head of Technical Research, Sharekhan by BNP Paribas
The Nifty had a gap up opening on January 24 & crossed the swing high of 18,184 however couldn’t sustain in the higher territory. The hourly upper Bollinger Band has become flat & is keeping pressure on the higher side. As a result, the Nifty stayed back into the brief consolidation mode.
It is forming a base near the key hourly & the daily moving averages. On the daily chart, the index is forming higher top higher bottom & is expected to see upward trajectory.
In the short term, the Nifty is expected to surpass the key hurdle zone of 18,260-18,300 & head towards 18,500. On the other hand, the level of 18,000 will provide cushion on the downside.
Indian rupee closed 33 paise lower at 81.72 per dollar against previous close of 81.39.
Equity markets?ended on flat note in the volatile session on January 24. Key indices Nifty50 closed flat at 18,118 levels, whereas the S&P BSE Sensex closed at 60,978 levels, up 37-odd points or 0.06 per cent. Throughout the day, the benchmark index the S&P BSE Sensex, however, soared over 300 points to a high of 61,266 and low of 60,849, down 92 points, while Nifty50 hit day’s high and low of 18,201, and 18,078, respectively.
The market sees Budget 2023 Vande Bharat getting a big boost on February 1. Siemens last week bagged one of its biggest orders in the history of Rs 26,000 crore. The firm in partnership with RVNL is also the L1 bidder for Surat and Ahmedabad metro projects. Vande Bharat could be a Rs 1.7 trillion opportunity from the recently floated tenders. The initial tranche of 200 trains, according to a CNBC-TV 18 report, is an opportunity of Rs 60,000 crore.
Senior citizens who have purchased health insurance policies can claim tax deductions of up to Rs 50,000 under Section 80D on premiums paid. If their children pay premiums on their behalf, they can avail of this deduction. “In a country where medical expenses are not totally free even in government hospitals, ideally, the government should provide a 100 percent deduction against medical expenses without any limit,” says Pankaj Mathpal, Founder, Optima Money Managers.
Regular health insurance policies do not cover outpatient department (OPD) expenses such as pharmacy bills, doctor consultation fees, and diagnostic tests
Manan Dixit, Founder, FidyPay, said, “The government should formulate tax incentives for venture capitalists and angel investors investing in fintech Startups to promote investments in the sector. The government should provide tax exemptions on software purchases used by fintech companies to promote technological advancement in the sector.”
SBI in a report has pushed for an increase in the threshold for interest exemption from the current Rs 50,000 to Rs 75,000-Rs 1 lakh for senior citizens. Under 80TTB interest income from deposits by senior citizen (Savings bank accounts, fixed deposits, recurring deposit accounts) up to Rs 50,000 is exempted from income tax. This threshold may be increased to Rs 75,000 / Rs 1 lakh which still will have much lower fiscal cost
India’s first sovereign green bond will go to auction Wednesday, and policy makers have laid the groundwork to ensure a successful debut. This offering will be sold in 5-year and 10-year tenors via a uniform price auction on Jan. 25
Malay Shankar, CEO, ProConnect Supply Chain Solutions Limited, said, “The New Labour Code directly impacts the blue collar workers who are the backbone of the logistics and supply chain industry. Bringing in more straightforward means of enforcing it, while ensuring social security and economic benefit to the blue collar workers will fetch long-lasting results. Getting rid of ambiguity and having simpler ways of implementation will help industrial workers. Coupled with the supportive Digital India policies, the government can thrust on closing the digital gap that persists in the industry. With lucrative sops for players bridging this gap by skill training to their workforce, the government can boost leaders in the space to catalyse the digital evolution of the sector.
European stocks edged higher on Tuesday, boosted by a fresh run of gains for technology stocks, while investors awaited economic data that is expected to show a slight improvement in euro zone business activity.
The pan-European STOXX 600 index rose 0.1% after a strong finish on Wall Street, lifted by tech stocks that were battered last year in the wake of surging interest rates.
S&P Global’s flash reading, due at 0900 GMT, is expected to show the euro zone flash composite PMI edged up to 49.8 in January, a small improvement from 49.3 in December, as energy prices dropped and inflation moderated.
Among stocks, Rheinmetall added 1.2% after the German defence group’s chief executive forecast sales would grow to 11-12 billion euros ($12-$13 billion) in 2025, according to German magazine Stern.
Ghosal said: “While the Ayushman (“PMJAY”) scheme has come a long way in addressing financing support to low-income patients, there is a need to incentivise private insurers to provide affordable insurance packages to the “missing middle” who delay surgeries due to lack of financing.Further, a focus on incentivising primary and preventive care by ensuring higher budgetary allocation towards primary care, increased tax exemption on primary care expenditure as well as expansion of Primary Health Centres (PHC’s) and PPP integration of PHC’s via medical and technology support can help reduce hospitalization expenses in an otherwise fee-for-service system where millions suffer from chronic diseases.”
Prateek Ghosal, Chief Strategy Officer, Ujala Cygnus Group of Hospitals, said: “In order to attract more private sector investment in Tier 2 and 3 cities of India, healthcare should be given Infrastructure status which will enable access to low-cost funding as well as provide tax benefits, further reducing input costs. While during the COVID-19 pandemic, the RBI incentivised liquidity for emergency healthcare services by the extension of credit under priority-sector classification, this move should be made permanent, particularly for projects focused oncreating infrastructure in Rural India. Further, to ensure success of subsidy schemes and Viability Gap Funding under various state and central policies, the overall construct needs to be further streamlined by enabling allocation of capital within specific timelines, supporting not only infrastructure and equipment funding but also manpower and operational funding, providing flexibility in pricing and creating a robust process to channel patients. This will ensure thatPPP projects are sustainable in the long run.”
This time, expectations also feature around the implementation of the recommendations of the GST Council, particularly on matters related to raising the threshold limit for launching criminal prosecution; rationalization of tax rates and further steps to abolish the inverted credit structure; and expectations to rationalize provisions of availing input tax credit by recipients of supply. To the last end, today the input credit structure puts the onus of correctness of availing credit on the recipient, even for compliance / non-compliance of vendors. It is a long-standing desire of the industry that these provisions are examined, and certain practical rationalisations implemented to make the provisions friendlier for businesses. READ MORE
As the real estate sector caters to different segments of the society, the government’s focus on affordable housing is expected to further provide an impetus to this segment. The industry has made some suggestions that they hope would provide a sustained growth to the sector. For home buyers, lower house prices and low home loan interest rates are some of the key demands. Read More
Key business highlights ? Highest ever total sales and exports in CY2022 Total sales : 1,940,067 units Exports : 263,068 units ? Cumulative production crosses 25 million units ? Sales network grows to 3,500+ outlets ? Record dispatches of 3.2 lakh+ vehicles using railways in CY2022
The Feb. 1 budget will be FM Nirmala Sitharaman’s last full-fledged one before national elections in 2024 and before elections in several large populous states that will be key tests for the ruling Bharatiya Janata Party (BJP).
The Indian government will borrow a record Rs 16 lakh crore ($198 billion) in the fiscal year to March 2024, according to a Reuters poll of economists, who said infrastructure spending and fiscal discipline ought to be its highest budget priorities.
The federal government’s gross indebtedness has more than doubled in the past four years as Prime Minister Narendra Modi’s government has spent heavily to cushion the economy from the effects of the COVID-19 pandemic and to provide relief to the poor.
“The key reason gross borrowing is going to be still quite high is the repayment burden,” said Dhiraj Nim, economist at ANZ. “The government borrowed a lot in the last few years to have funds for the pandemic, which means the repayment burden will now be quite elevated for several years.”
While economists in a separate Reuters poll forecast the government would bring the budget deficit down to 6.0% of GDP in 2023/24, it will still be well above the average of 4% to 5% seen since the 1970s and far from the target of reaching 4.5% by 2025/26.
The deficit is more than double what it was before the pandemic. Rising interest rates have increased the burden of repaying the borrowed money.
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