Union Budget-2010-HighLights-inf. by ashok Hindocha M-9426201999

Union Budget-2010- High Lights

* Govt's push for infra development to boost GDP growth
* NMDC, SJVN stake sale to fetch Rs 25000 cr in FY'10
* Expect govt to push for disinvestment
* FM has kept the impetus on disinvestment
* Fiscal expansion was not sustainable for long
* Limit for tax credit increased from Rs. 40 to Rs. 60 lks
* Reduction in surcharge on domestic cos from 10% to 7.5%
* Commitment to rollout DTC
* Lower tax burdens on individuals
* To give Rs.16500 cr to PSU banks in FY'11
* Govt to keep service tax unchanged at 10%
* To raise duty on gold imports to Rs 300/10 grams
* To raise duty on gold and silver imports
* To grant project import status for HITS
* To grant project import status for monorails
* Excise duty on CFL halved to 4%
* Imposed 4% excise duty on electric cars
* To waive excise duty on photovoltaic panels
* To restore 7.5% duty on petrol and diesel
* To restore 5% duty on crude petroleum
* Rollback in excise duty to 10%
* Govt announces partial rollback in excise duty
* Investment linked deduction benefit for 2-star hotels
* Weighted deduction on R&D raised to 200%
* To reduce current surcharge on companies to 7.5%
* MAT to be raised to 18% vs 15%
* 10% tax on income between Rs 1.6 - 5 lakh
* 20% tax on income between Rs 5-8 lakh
* No tax on income up to Rs 1.6 lakh
* Rollout of GST needs consensus among Centre & States
* To broaden current tax slabs
* Borrowing plan to be decided in consultation with RBI
* To bring subsidy related liability into fiscal accounting
* Economy can absorb hike in excise and customs duty
* Net market borrowing pegged at Rs 3.45 lakh cr
* FY'12 Fiscal Deficit seen at 4.8%
* Fiscal Deficit for 2010-11 at 5.5%
* FM has tried to balance prices and growth
* Rs 60000 cr as capex for defence sector
* Allocation of Rs 1900 cr for UID project
* UIDA to roll out 1st set of IDs by end of this year
* Resource mobilisation not to trigger inflation
* National Social Security Fund for unorganised sec
* Govt to contribute Rs 1000/month for Pension Security
* Rs 5400 cr allocated for urban development
* FM has exercised moderation in rollback of stimulus
* Rs 48000 cr allocated for Bharat Nirman
* Rs 66100 cr allocated for rural development
* Allocation to NREGA raised to Rs 41000 cr
* To allocate Rs 22300 cr to Health Ministry
* Social sector spending in FY'11 seen at Rs1.38 lakh cr
* 25% of plan allocation for rural infra
* Govt ready with Draft Food Security Bill
* To provide 1 time grant for Tirupur exports
* To establish National Clean Energy Fund
* Plan outlay for renewable energy raised to Rs 1000 cr
* IIFCL disbursements at Rs 9000 cr by March 2010
* Allocation to road infra raised to Rs 19894 cr
* Govt to extend interest subvention of 2%
* RBI considering additional banking license to pvt players
* Tax saving of Rs.51,500 for income of Rs.10 lakhs
* RBI considering additional banking license to pvt players
* To raise Rs.25,000 cr in FY'10 from PSU disinvestment
* Hope to rollout GST by April 1, 2011
* To implement Direct Tax Code from April 1, 2011
* Hope to reach 10% GDP in near future
* Review of stimulus for fiscal consolidation
* Budget has to signal policies for the future
* Budget not a mere statement of accounts
* India faces challenges of reviving double digit growth
* Challenges not any less than 9 months ago
* Need to provide food security, healthcare for all
* Economy has weathered the recent economic crisis
* Indian economy faced grave uncertainty in 2009
* Need to move to high GDP target of 9%
* Budget to reflect govt's vision for development
* Weakness in govt system still a challenge
* Need to make development more inclusive
* Expect roadmap for reduction in subsidy for oil sector
* Issues of subsidy need to be addressed
* Expect a partial withdrawal of stimulus in the budget
* More clarity on growth in H2 CY'10
* Indian markets to trade sideways to negative
* Real GDP growth of 8-9% next fiscal
* Govt needs to address deficit concerns
* Monetary tightening likely to continue
* Rising inflation a challenge for budget
* No hike expected in IT exemption limits
* Likely roll-back in tax cuts on excise duties
* Depreciation rate to be aligned for accounting
* Expect fiscal deficit at 5.3% in FY'11 vs 6.3% of GDP
* Overall deficit may come down from 10% of GDP to 8.5%
* Expect govt to begin unwinding of softer fiscal stance
* Infrastructure push to continue
* Hike in Excise duty likely
* Announcement of divestments unlikely
* Govt must look at reducing corporate tax rates
* Expect fiscal deficit to be cut to 5.5% of GDP in FY'11
* Expect budget to withdraw certain stimulus measures
* Expect budget to start process of fiscal consolidation
* Need for policy intervention for initiating infra projs
* Expect to see relief for SPV structure
* European sales up 2% (YoY) to $80mn
* Guidance based on product exclusivity in U.S
* 2010 PAT seen at Rs.460cr vs Rs.310cr (YoY)
* Expect 2010 sales at Rs.7800cr vs Rs.7340cr (YoY)
* Inflation remains a concern
* Outline a stable disinvestment plan for few years
* Must look for clearer tax reforms in 2011
* Expect govt to take back some stimulus measures
* Excise rollback not to affect industrial growth
* Expect some support for export oriented sector
* Govt should focus on reviving investment demand
* Key triggers: Borrowing program and monetary stance
* South-based players may go slow on price hike
* May pass on hike in excise duty to customers
* No impact on Marico since products are tax exempt
* Marginal impact on Nestle and Britannia
* Difficult for HUL to pass on hikes due to shrinking share
* HUL: Major chunk of production attracts excise
* Competition will make it difficult to hike prices
* CV makers M&M, Tata Motors less sensitive to hikes
* Maruti, Hero Honda unlikely to pass on entire excise hike
* Prices may be increased if excise duty is hiked
* Auto, FMCG, cement likely to take a hit on margins
* Hike will impact cement, auto and FMCG
* Excise duty is expected to increase by 2-4%
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* Expect to see R&D reforms for education sector
* Strong case for impetuos measures to be reduced
* Hope to see partial rollback of the stimulus
* Nifty March Put-Call ratio at 1.26
* Lower than average rollover shows nervousness ahead
* Nifty starts the March series at 2.15 cr shares
* Nifty rollovers at 68.1% vs 76.5%
* Feb 23: Rs 634.2 cr Feb 22: - Rs 56.8 cr
* Feb 25: - Rs 594.78 cr Feb 24: Rs 566.4 cr
* FIIs Net Buy at Rs.645.02 cr in F&O
* FIIs Net Buy at Rs 321.48 cr in Stock Futures
* FIIs Net Sell at Rs.242.72 cr in Index Futures
* DIIs Net Buy at Rs 325.92 cr
* Reverting to path of fiscal responsibility
* FY'10 fiscal deficit is seen at 6.8% of GDP
* Total deficit, including states’ is 10.2% of GDP
* Widening of Tax net to include base not taxed earlier
* To ensure tax evasion gets more difficult & expensive
* Simplifying tax procedures that lead to tax evasion
* Need for a simple tax system with reasonable rates
* Short-term revenue loss must not hold up tax reforms
* Speedy implementation of GST desirable
* Disinvestment proceeds of Rs1120cr insufficient
* Govt should aim at raising Rs4000cr through disinvestment
* Funds collected can be invested in public sector
* Funds to be used for financing long term investments
* Shift from cash account to accrual budgeting beneficial
* Accrual budgeting will ensure resource utilisation
* Accountability with delivery time key to efficiency
* Third party monitoring for each project
* FIIs Net Sell at Rs 594.78 cr
* Third party monitoring will ensure resource utilisation
* Monitoring cell to include Govt, and industry experts
* Reforms needed in property, tax and import procedures
* Sustaining domestic level of prices not viable
* Administrative reforms can help cut transaction costs
* Govt should provide flexibility in labour laws
* Labour laws must enable industry to compete with China
* Risk of food inflation cascading to other sectors
* Long pending labour reforms have hindered investments
* A sound regulatory framework needed
* Sharp increase in food prices cause for concern
* Transparency in bidding process for PPP projects
* Issues delaying roll-out of PPP need to be addressed
* Recommends bringing down deficit to 5.7%
* Govt intervention needed to expedite PPP process
* Conducive eco-system for SMEs needed
* Recommends calibrated exit move from current stand
* Systems should provide supply of man power, branding
* Simplify process of land acquisition
* Tax benefits for companies which source from SMEs
* SME stock exchange will help raise equity capital easily
* Continue with concessional excise duty of 8%
* Reduce excise duty gap between large and small cars
* Large cars attract 20% + Rs 20,000 excise, small cars 8%
* Recommends fiscal consolidation by eliminating deficit
* Reduce excise duty on MUVs from 20% to 8%
* Remove anomalies in input and output duty structures
* Tyres can be imported at 10% duty, natural rubber at 20%
* Reduce excise duty on carbon black from 14% to 8%
* GDP growth expected to breach 9% in 2011-12
* Classify ATF as a 'declared good' attracting 4% VAT
* States presently tax ATF at varying rates, going up to 16%
* Scrap 10% service tax on intl travel in first class
* Increase the FDI limit in aviation to 49% from 26%
* Extend repayment period on farm debt waiver
* Increase FDI cap in insurance from 26% to 49%
* GDP seen at 8.5% ( +/- 0.25%)
* Allow power finance companies to float tax free bonds
* GDP growth expected to be 1% higher in FY'11
* Recapitalise PSU banks or permit raising stake dilution
* Increase cap on FII stake in PSU banks from 20%
* Correct input and output duty anomalies
* Cement attracts no import duty, but pet coke attracts 5%
* Simplify MRP based excise duty structure for cement
* Excise duty is Rs 230/tn for MRP below Rs 190/50kg bag
* Allow abatement for manufacturing expense for MRP excise
* Continue with the concessional excise duty of 8% now
* Increase the income tax slab to drive consumption
* Increase allocation to NREGS and other welfare schemes
* Yen declines, export stocks trade positive
* Japan industrial production rises 2.5% (MoM)
* Japanese stocks trade marginally higher
* Mixed trade across Asian markets
* Bernanke: Fed to investigate trader betting against Greece
* Orders for durable goods rose 0.6% in January
* Increase depreciation rate for hotels to 20%
* Jobless claims hit 22,000 for the latest week
* Increase tax holiday period from 5 years to 10 years
* Early sell off triggers by concerns on Greece, eco data
* Make LTC tax free every year vs for 2 years in block
* Make VAT rate for hotels uniform across the country
* Exempt cakes made in hotels from 8% excise
* Bring STPIs on par with SEZs on tax benefits
* Increase outlay for higher education
* Allocate 2-3% of GDP for e-governance projects
* GDP growth expected to be 1% higher in FY'11
* Formulate the PPP process for roads and infra projects
* Exempt infra cos from 15% dividend distribution tax
* Exempt all infra cos from payment of MAT @ 15%
* Govt should ensure free flow of credit to infra sector
* De-regulate oil sector,adopt Parikh Committee’s suggestion
* Increase subsidies from Rs 0.83/lt for kerosene
* Provide infrastructure status to E&P and refining
* Extend 80 IB benefit to pre-NELP & NELP I-VII gas blocks
* Give a tax holiday to city gas distribution networks
* Exempt power companies from 15% distribution tax
* Exempt power companies from MAT @ 15%
* Allow power companies to isssue tax-free bonds
* Increase subsidy for solar energy to Rs 16/unit
* Exempt carbon credit income earned from renewable energy
* Increase deduction on housing loan interest to Rs 2.5 lk
* Extend tax benefits for affordable housing beyond Mar '12
* Allow fund raising via ECBs through the automatic route
* Allow separate deduction for housing loan repayment
* Cut long term capital gains period to 1 year for realty
* Increase duty on iron ore exports to 20% from 15%
* Continue with excise duty rate of 8%
* Accord infrastructure status to the steel sector
* Extend the 10 (B) benefit to export from SEZs from Mar '10
* Extend 2% interest rate subvention to March 2011
* Biggest challenge in removing impediments
* Targets in infrastructure sector achievable
* Capacity addition in power and roads behind target
* Inflation primarily driven by food products
* Slowdown in agriculture affecting some segments
* Industrial outlook bright in the medium term
* Growth in credit to industry fell from 37% to 14.2%
* Automobiles, rubber manufacturing recover strong
* Inflows were down 2% at $19.38 bn (YoY)
* Recovery in industrial sector is evident
* Inflows at Rs 93,354 cr, a growth of 9% (YoY)
* Growth in consumer durables drove industry revival
* Reversal in downward trend in IIP growth
* Food coupons must replace existing PDS system
* Capital inflow creating a supply demand imbalance
* Portfolio investment rush fuel rise in markets
* Portfolio investment not backed by strong fundamentals
* Capital inflows into economy to have negative impact
* Oil, food bonds need inclusion in fiscal accounting
* Consumption more impacted by slowdown
* Tax receipts down due to excise rate cut
* Expenditure restraint to keep deficit at 6.8%
* Receipts down due to indirect tax shortfall
* Likely shortfall in revenue receipts
* Cut Cap goods tariffs to 3%, abolish EPCG scheme
* Lower peak duties from 10% to 7.5% merchandise sector
* Large inflows crucial for countries with deficit
* Policy changes needed to promote exports
* Legislation enabling states to levy service tax proposed
* Centre to reduce share in gross tax revenue
* Centre to review levy of cess and surcharge
* Fiscal consolidation by reducing revenue deficit
* Rs 30000 cr compensation if GST introduced in 2014
* Rs 40000 cr compensation if GST introduced in 2013
* Rs 50000 cr compensation for states' revenue loss
* Binding agreement of GST rates between Center-States
* GST to contribute significantly to tax revenues
* Proposes to reduce debt, GDP ratio to 68%
* GST seen as a game changer in tax reform process
* Increasing fuel prices may increase inflation
* Sustaining domestic fuel prices not viable
* Food inflation entails risk of transmitted
* Sharp increase in food price cause for worry
* Fundamentals of economy improving
* GDP growth expected to breach 9% in 2011-12
* GDP seen at 8.5% (+/-0.25%)
* GDP growth expected higher by 1% over 2009-10

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