Budget supports Agri, Re, Exports
The banking sector is reading positive notes from the 2020 Budget tabled in parliament on 1 Feb 2020 by Finance Minister Nirmala Sitharaman.
“The Union budget presents the government’s intent to boost consumption and support inclusive growth,” noted Surojit Shome, Chief Executive Officer of DBS Bank India.
The revision of the income tax rates and the option for individuals to opt for a simpler and lower tax regime is likely to incentivise consumer spending and stimulate demand, said Shome in comments on the budget.
The proposed allocation towards the BharatNet programme continues the digital transformation efforts by the government to provide deeper access to digital connectivity.
This will enable a larger part of the rural population of India to come within the ambit of the formal economy and create an accessible framework for digital financial services, he said.
In a fillip to the SME sector, the government is providing subordinate debt which could bridge a key gap in the ecosystem and increase access to working capital.
“The thrust on the GeM platform also presents a significant opportunity for SMEs,” noted Shome.
The removal of the Dividend Distribution Tax (DDT), proposed exemptions for the sovereign wealth funds and the proposals on withholding tax will have a positive impact on foreign investments into India.
“This will help the infrastructure and real estate sector. Additionally, the substantially expanded disinvestment program is a positive step,” said the chief of DBS India, one of the fastest growing foreign banks in the country.
“Despite tight fiscal constraints, the Budget has done a great job of supporting growth by tweaking taxes and facilitating the development of core sectors like agriculture and allied activities, renewables, exports and social sectors with thrust on digitization,” observed Dinanath
This is strongly positive for the business model of cutting edge NBFCs like LTFS. “If implemented judiciously, this Budget has the potential for transforming India,” said Dubhashi in his comments on the announcements relating to NBFCs. fiinews.com