The Centre struck a perfect balance between fiscal prudence, and growth in the rural and agri economy while working on realistic tax receipts.

Growth assumptions are encouraging despite local challenges, global slowdown and volatility.

Capital market participants were worried on possible changes to long-term capital gains (LTCG) tax provisions. However, these were not fiddled with. Dividend tax above ₹10 lakh was unsatisfactory, but the relief from status quo on LTCG more than made up for the additional burden.

Provision of ₹25,000 crore for bank recapitalisation was expected. And the FM assured that if needed, more funds would be made available for recapitalisation of PSU banks.

His statement on willingness to go below 50 per cent government stake in IDBI Bank and possible consolidation in other PSU banks raises hopes for many investors.

Ambitious target

While the assumption of spectrum sale amounting to ₹90,000 crore seems optimistic, no mention of sale of SUUTI stakes in ITC, Axis Bank and L&T, was disappointing. The disinvestment target of ₹56,500 crore, including ₹20,500 crore of strategic sales is ambitious given past trend. However, renaming of this department to Investment and Public Asset Management (DIPAM) sends a positive signal as far as the mindset is concerned.

Clarifications on dividend distribution tax (DDT) for distribution out of REITs and InvITs should help achieve monetisation of such infrastructure and housing assets and attract specialised investors to this financial instrument.

To summarise, the Budget provisions should appeal to all stakeholders. Equity markets will again start focusing on global cues and domestic earnings.

(The writer is MD, Emkay Global Financial Services. The views are personal)

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