Post Budget Analysis 2018 By NITIE Mumbai
Whenever we hear the term ‘Budget’, it gets us intrigued. What kind of budget? Is there anything which will directly or indirectly impact me, my surroundings or the country? These are the kind of inquisitive questions, we generally have ahead of any budget and the Union Budget 2018 was no different. Being the last full budget of the current government, it was thought to be a populist budget. Also, it was the first budget since the introduction of GST and was keenly watched to see what the Finance Minister does to boost growth in Asia’s third-largest economy. The budget included many significant announcements. The National Health Protection Scheme(NHPS) being one of the main draws – which intends to provide a health insurance to 100 million families with an annual cover of up to ₹5 lakhs. The long-term capital gains (LTCG) tax of 10% was re-introduced. Corporate tax was reduced from 30 to 25% for companies with turnover up to ₹250 crores. The govt. seemed interested to push for digital technologies like blockchain.
There is so much to grasp and make sense of, as to what will be the impact of such announcements on the industry, common people and the nation. What better way to get insights on this, other than getting straight from the industry stalwarts? We at National Institute of Industrial Engineering (NITIE), organized the Post Budget Analysis 2018 on 8th Feb by inviting eminent personalities both from industry and academia to share their views. This was the 4th edition of the event and as always organized by $treet, the finance club of NITIE.
The eminent panellists who graced the dais included Mr Arun Thakural, MD & CEO Axis Securities; Mr Mukesh Kripalani, CXO, Business Process Transformation & IT, Marico Ltd; Ms Lakshmi Iyer, CIO – Fixed Income & Head-Products, Kotak Mahindra Asset Management Co and NITIE’s very own, Prof. Dr Narayana Rao who is a senior faculty in the Industrial engineering and manufacturing management area. The Dean, Academic at the institute, Prof. Vivekanand Khanapuri was also present for the all-important event. The discussion was moderated by Mr Roy Eddington Charles, Mentor, Roy Eddington-Charles and Associates.
Prof. V Khanapuri started the discussion by welcoming the guests and putting forth his questions, or rather expectations, from the discussion. Mr Thakural shared his views on agricultural MSP, markets, focus on new technology and infrastructure. Mr Kripalani stressed that the next phase of FMCG growth will be driven by rural spending. The government’s initiative of providing wifi hotspots and increase in rural spending could guide this. Mrs Iyer focused on the fiscal deficit, Moody’s rating of India, disinvestment and tax compliant.
Some of the key takeaways from the discussion were – The NHPS is seen as a very positive step in the right direction. It will not only help poor families save on healthcare costs but also help increase the penetration of insurance. The sources of funding for the scheme still need to be identified. The technologies which are on Gartner`s hype cycle, are being promoted (Blockchain, IoT) which is a positive for India. The MSP for agricultural produce is seen in a positive light. Though clarification needs to be made on the implementation details (A2+FL or C2 – MSP deciding criteria). The slip of the fiscal deficit is not seen as too negative on the hope that it will help boost infrastructure spending. The increase in the broadband network can help rural India get a push in digital transition. LTCG is seen as “Let that capital grow” and is seen in the positive tone.
Mr Roy Eddington kept the session lively by asking inquisitive and interesting questions. Some of the points to ponder were also given to the students, like “permission to use fixed-term labour contracts”, “12% PF in all industries”, “state and concurrent subjects” etc.
Students from institutions like SP Jain, JBIMS and SIMSREE attended the discussion. The great mix of panellists helped students grasp the different views on the subject. Overall it was a very engaging and enlightening session. Every participant added great value to the session, and it turned out to be a successful and relevant discussion on the current budget.