The Union Budget strikes a balance between expenditure, consumption and borrowings.
Union Budget 2017-18 – An eye on the future
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Budget 2017 can be said to be trying to benefit some but harm none. The fiscal deficit target is in line with the gross borrowing programme, which has not been enhanced this year. This will also allow the RBI to take a call on policy rates independent of govt. borrowing programme. Cut in income tax rates in the lower income slab would help increase spending which has been badly affected post DeMo. Similarly, since the indirect tax slabs have not been changed, the inflation impact should be neutral for the present till the time GST is implemented. The focus of capital expenditure has been on transportation infra structure sector (railways, highways and roads). This should positively affect the heavy industries sector (cement, steel, machinery electrical equipments etc). This is also reflected in the higher thrust on housing sector as the above industries are closely linked to housing sector. To boost private investment, which plays a major role in increasing investment, the FM should have given benefits in corporate tax. According to the budget, this year seems to be the year of consolidation with the GST implementation and remonetisation. This is likely to lead to a big disinvestment programme being undertaken. You can refer to Bodhi resources page for downloading the PDFs of Economic Survey and Union Budget.
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