Highlights: Budget 2015-16
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ram@justransact.com
02-03-2015 00:00:00
Highlights: Budget 2015-16
The Government will meet a "challenging" fiscal deficit target of 4.1 per cent of its gross domestic product (GDP) in the year to March 31, 2016 Finance Minister Arun Jaitley said, when presenting the government's full-year budget.

Here are some of the highlights of the budget for the fiscal year that begins on April 1, 2015.

FISCAL DEFICIT

- Fiscal deficit seen at 3.9 per cent of GDP in 2015/16

Remain committed to meeting medium term fiscal deficit target of 3 per cent of GDP

Jaitley says have to keep fiscal discipline in mind despite need for higher investment

- Current account deficit below 1.3 per cent of GDP

GROWTH

- Aiming double digit growth rate, achievable soon

- GDP growth seen at between 8 per cent and 8.5 per cent y/y

INFLATION

- Monetary policy framework agreement with the RBI clearly states objective of keeping inflation below 6 per cent

- Expects consumer inflation to remain close to 5 per cent by March, opening room for more monetary policy easing

- "One of the achievements of my government has been to conquer inflation. This decline in my view represents a structural shift."

MARKET REFORMS

- To bring a new bankruptcy code in 2015/16

- Propose to merge commodities regulator with SEBI

- Jaitley says will move to amend the RBI act this year, and provide for a monetary policy committee

- Proposes to introduce a public contract resolution of disputes bill

- To set up public debt management agency

- To establish an autonomous bank board bureau to improve management of public sector banks

POLICY REFORMS

- To launch a national skills mission soon to enhance employability of rural youth

- Propose to create a universal social security system for all Indians

- To raise visa-on-arrival facility to 150 countries from 43

- Allocates 346.99 billion rupees for rural employment guarantee scheme in 2015/16

TAXATION

- Plans to introduce direct tax regime that is internationally competitive on rates without exemptions

- Expects to implement goods and services tax by April 2016

INFRASTRUCTURE

- Plans to set up national investment infrastructure fund

- Investment in infrastructure will go up by 700 billion rupees in 2015/16 over last year

- Proposes tax-free infrastructure bonds for projects in roads, rail and irrigation projects

- Second unit of Kudankulam nuclear power station to be commissioned in 2015/16

- Proposes 5 "ultra-mega" power projects for 4,000 MW each

- Ports in public sector will be encouraged to corporatise under Companies Act

- Will need to build additional 100,000 km of road

EXPENDITURE

- If revenue improves, hope to raise budgeted allocations for rural job scheme by 50 billion rupees in 2015/16

INVESTMENT

- To allow foreign investment in alternative investment funds

- Propose to do away with different types of foreign investment and replace them with composite caps

GOLD

- To introduce Indian-made gold coin to reduce demand for foreign gold coins

- To introduce gold monetisation scheme to allow depositors to earn interest

Source: Economic Times
-K Ramanathan ram@justransact.com


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