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Tag Archives: Finance Minister

……..and Markets Came Tumbling Down ……..an attempt to explore the Cause..

……..and  Markets Came Tumbling After

Perhaps, both Dr. Manmohan Singh as Leader of Ruling Party in Power and Mr. Pranab Mukherjee, as Finance Minister went up there, this budget session, to specially put the Indian GDP in higher growth trajectory. Probably all went in vein. All accepted; but then what could be the reason at the route of it? Is anyone interested and involved in finding out the route cause or all are merely trying to make the smart, logical and rational guesses.

Many experts have been found blaming it on the variety of issues, and the sum of these issues is much larger number than all the experts giving their opinion put together. It signals an impression that now a doctoral thesis should be presented on ways of identifying that the individual, who is well dressed and has somehow made it to a position of power and claiming to be expert of domain, is really an expert or a garbage vomiting biological machine.

Pictorial Representation Market Crash

Market Crash of Two Different Centuries     1930 — &–2008

The reasons forwarded by expert for any wanted or unwanted oscillation in the national economy has as much probability of being found in few phrases mentioned below, as much is for any oscillation happening in mood of markets, in next day trading session.

An Attempt:

1. Probably this is an outcome of policy paralysis at the level of Government…

2. It is due to fear being felt by FIIs due to the possible provisions of GAAR on P- Notes…..

3. This is being reflected as the Rupee is getting weaker……

4. It is due stubbornness being shown by RBI Governor by not easing interest rate…

5. It is an outcome of inflationary pressure…..

6. Because European markets opened on lower side…

7. Euro zone crisis is having its impact felt… as all the economies are networked these days….

8. Prices of Crude Oil are moving northwards due to possible stance of USA on Iran’s nuclear issue..

9. The monsoon has cracked a joke on us….

10. The quarter -1 , 2, 3, 4 data for industrial output were not promising….

11. There is a growth being noticed in unemployment rate in USA….

12. Forecast of Chinese economy has taken the fizz out of the market….

13. All this is due to the nation’s money lying in the tax heavens abroad….

14. The growing fiscal deficit is responsible for it….

15. It is the burden of subsidy that is killing the government…..

16. Investors’ are fearful of risky assets and they going for Cash or preferring cash..

17. The Greece crisis has taken its toll….

18. The Spaniards are going uncontrolled……

19. It is due to the Vodafone issue..Where FM wants to put a tax with Retrospective effect..

20. Rupee falters on rupee outflow fear…..

21. Now markets are waiting for first signal of Mr. Hollande, the new President of France.….

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N. The grocery seller was saying that Fed is in for an interest rate hike…..

N+1. I heard my taxi driver telling to someone that it is being stage managed by the government…

N+2. There is a foul smell of some foreign hands behind it…….

This is not the end of the list, and therefore just an illustrative one has been put up. Please feel free to add your suggestions. The names will be sent to Nobel Committee which supposed to announce the Current Years’ Nobel Prize Winner in Economics by conducting a free and fair lucky draw from it…..

                                                                                                                     Always Yours— As Usual —– Saurabh Singh

Bank on Government’s Social Agenda

It has always been nice to hear the Central Banker of the country talking and favouring financial inclusion despite of tremendous pressure in favour of financial consolidation. Though, this does not down size the importance of Financial Consolidation, looking into type of competition the banks or rather banking sector in locked into.  The prospective change in policy, when it comes to granting license to Banks to operate, towards asking them to commit themselves to Governments’ social agenda of Financial Inclusion is again an august step.

 

Four decades succeeding the bank nationalization, have just succeeded in provide access to banking services to barely 30,000 out of 6 Lakh habitations. This clearly means the huge task that banks still have to complete. Looking into achievements of banks one may infer as if the banks were just paying lip service to governments agenda of financial inclusion.

 

Central Bank, should perhaps consider asking new bankers to have their headquarters located in one of 570000 habitations, which are still facing financial exclusion. As this will automatically initiate what is called as seepage economy at those places and in process will gradually attract more bankers and other stakeholders in the development process there.

 

Due credit goes to the backing given by Prime Minister Manmohan Singh to the Central Banker of the country, which forced even union finance ministry to a bit down on its focus towards financial consolidation. Though finance ministry, still wants to stick to financial consolidation, as Union Finance Minister Pranab Mukherjee could not abstain himself from containing in Financial Bill 2011-12 presented by him in the Parliament on February 28, 2011.

Always Yours–As Usual—Saurabh Singh

Salient Features of Indian Union Budget 2011 – 2012

  1. IncomeTax exemption limit raised to Rs. 1.80 lakh from Rs. 1.60 lakh .
  2. Exemption for senior citizens raised to Rs. 2.5 lakh.
  3. Tax under women slab unchanged.
  4. Tax exemption raised to Rs. 5 lakh for senior citizens of 80 years.
  5. To increase service tax on air travel.
  6. Excise and customs duty proposals to result in the net gain of Rs. 7,300 crore.
  7. Export duty rates on iron ore unified and kept at 20% ad valorem.
  8. Basic customs duty on agricultural machinery reduced to 4.5% from 5%.
  9. Basic customs duty on raw silk reduced from 30 to 5 per cent.
  10. Excise and customs duty proposals to result in the net gain of Rs. 7,300 crore.
  11. Nominal one per cent central excise duty on 130 items entering the tax net. Basic food and fuel and precious stones, gold and silver jewellery will be exempted.
  12. Peak rate of customs duty maintained at 10% in view of the global economic situation.
  13. Customs duty exemptions for hybrid auto parts.
  14. Nominal one per cent central excise duty on 130 items entering the tax net. Basic food and fuel and precious stones, gold and silver jewellery will be exempted.
  15. Standard rate of central exercise duty maintained at 10%.
  16. Central government debt in proportion to GDP will be 44.2% in 2011-12.
  17. 20% export duty on all grades of iron ore.
  18. Basic customs duty reduced on certain textile products
  19. No change in service tax rate of 10%.
  20. No change in central excise duty.
  21. Plan to levy 1% on 130 consumer items.
  22. Revenue deficit fixed at 2.3 per cent in revised estimates of 2010—11 and 1.8 per cent in 2011—12.
  23. Total plan expenditure will go up 100 per cent in nominal terms in the next year.
  24. 15% tax on dividend for Indian cos from foreign unit.
  25. Direct Tax proposals result in expenditure of Rs. 11,500 cr.
  26. To reduce surcharge on domestic companies to 5% from 7.5%
  27. MAT rate hiked to 18.5% from 18%.
  28. MAT on developers in SEZs to be levied.
  29. Fiscal deficit revised to 5.1% from 5.5% for FY’11.
  30. Total expenditure raised by 13.4% at Rs. 12.57 lakh cr over budget estimates.
  31. Gross tax receipts estimated at 9.32 lakh cr for FY 2011-12.
  32. Bill to amend India Stamp Act soon.
  33. Budget allocation of Rs. 100 cr for Ladakh and Rs. 150 cr for Jammu for implementation of projects identified by taskforce.
  34. Old age pension to persons of over the age of 80 raised from Rs. 200 to Rs. 500
  35. Health allocation up by 20% to R 27,600 cr.
  36. Rs. 9- lakh ex-gratia for defence personnel for 100% disability fighting Left-wing extremism.
  37. To set up 15 more mega food parks.
  38. Remuneration of anganwadi workers raised from Rs. 1,500 to Rs. 3,000 per month, Helpers to get Rs. 1,500 from Rs. 750.
  39. Tax free bonds of Rs. 30,000 cr to be issued for infrastructure development. This will cover Warehousing Corporation, NHAI, IRFC and Hudco.
  40. Allocation under Rashtriya Krishi Vikas Yojana to be raised from Rs. 6,755 crore in the current year to Rs. 7,860 crore.
  41. Rs. 50 cr grant to Aligarh Muslim University centres in Murshidabad in West Bengal and Malappuram in Kerala.
  42. Rs. 200 cr for environmental remediation programme.
  43. Age for pension eligibility reduced from 65 years to 60 years under Indira Gandhi Yojana scheme.
  44. To move insurance, pension and banking bills in Parliament.
  45. Rs. 500-cr for National Development Fund.
  46. Rs. 400-cr as one-time grant for IIT-Kharagpur.
  47. Move to set up State Innovation Councils underway.
  48. Allocation to education sector raised to Rs. 52,000 cr.
  49. Scholarship scheme for SC/ST students in classes iX, X.
  50. Increase in allocation to higher education.
  51. Plan 17% increase in social sector spending.
  52. To introduce Food Security Bill.
  53. Tax free bonds of Rs. 30,000 cr to be issued for infrastructure development. This will cover Warehousing Corporation, NHAI, IRFC and Hudco.
  54. Fertiliser industry to be included under infrastructure category.
  55. New companies bill to be introduced.
  56. GoM to be set up to deal with corruption.
  57. Five-fold strategy to deal with black money.
  58. Mega cluster for leather products to be introduced.
  59. Existing interest subvention scheme on short term farm loans at 7 % interest to continue.
  60. Self-assessment in customs to be introduced.
  61. Credit flows to farmers raised from Rs. 3.75 lakh crore to Rs. 4.75 lakh crore.
  62. Constitution Amendment Bill for introduction of GST in this session.
  63. Goods and Services Tax Bill this year.
  64. Direct Taxes Code Bill likely to be passed by Parliament next financial year after getting Standing Committee report.
  65. Public Debt Management Agency Bill in the next fiscal.
  66. Indian mutual funds to get direct access to foreign markets; FIIs to be allowed to invest in MFs.
  67. To liberalise FDI policy further.
  68. To extend infra tax breaks to fertiliser sector.
  69. To set up microfinance equity fund.
  70. Government to move towards direct cash transfer of cash subsidy as regards kerosene, LPG and fertilisers from March 2012 for BPL in view of large diversion.
  71. 3% interest subvention to farmers who repay in time.
  72. Nabard capital base to be increased by infusing Rs. 10,000 cr.
  73. Rural housing fund increased to Rs. 3,000 cr.
  74. Banks asked to step up lending to agriculture.
  75. Allocation under Rashtriya Krishi Vikas Yojana to be raised from Rs. 6,755 crore in the current year to Rs. 7,860 crore.
  76. Budget proposes to raise housing loan limit from Rs. 20 lakh to Rs. 25 lakh for priority sector lending.
  77. Allocation for farm development hiked to Rs. 7,860 cr.
  78. Rs. 300 cr proposed to promote production of cereals.
  79. Indian micro-finance equity with SIDBI to be formed at Rs. 100 crore.
  80. Rs. 6,000 cr to be given to public sector banks to maintain capital-to-risk assets ratio norms.
  81. RBI to bring in new guidelines for banking licences.
  82. Aiming Fiscal deficit of 3% by fiscal 2014.
  83. Central electronic registry to reduce fraud cases.
  84. FII investment limit for infra corporate bonds hiked to $40 billion.
  85. Discussions on to further liberalise FDI policy.
  86. Preparation of GST rollout in final stages.
  87. Microfinance equity fund of Rs. 100 cr proposed.
  88. Govt committed to hold 51% in PSUs.
  89. Rs. 3,000 cr to Nabard for handloom societies.
  90. Women self-help group development fund to be set up.
  91. Direct transfer of subsidy for kerosene.
  92. Goods and Services Tax Bill to be introduced in Parliament this year.
  93. Direct Tax Code Bill likely to be passed by Parliament next financial year after getting Standing Committee report.
  94. Disinvestment target at Rs. 40,000 cr.
  95. Direct Tax Code from April 2012.
  96. SEBI-registered MFs to be allowed direct access to foreign funds.
  97. Expect RBI to moderate inflation.
  98. Public Debt Management Agency Bill to be introduced next financial year.
  99. Current account deficit and average inflation in 2011-12 likely to be less than current year.
  100. FDI policy review done in Sept 2010.
  101. Economic growth in 2011-12 likely to be 9 per cent.
  102. Admits large-scale diversion of kerosene.
  103. Introduction of DTC will be a watershed moment.
  104. Debt managment bill to be introduced.
  105. Constitutional Amendment Bill on GST to be introduced.
  106. Expect agri sector to grow at 5.4% in 2011.
  107. Growth in 2010-11 broad-based.
  108. Economy resilient to shocks.
  109. RBI measures will further moderate inflation.
  110. GDP estimated growth at 8.6% in real terms.
  111. New dynamism in rural economy.
  112. Core inflation in check.
  113. Current account deficit is at 2009-10 levels, and is a matter of concern.
  114. Huge difference in wholesale and retail prices not acceptable.
  115. Total food inflation down from 20.2 per cent last year to 9.3 per cent in Jan
  116. Revival in private investment should be sustainable.
  117. Service growing in double digits.
  118. Need to reconcile legitimate environmental concerns with developmental needs.
  119. Food Inflation has declined by half, but still a matter of concern.

Agribusiness

 

 

 

 

Always Yours — As Usual–Saurabh Singh

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