Where on one hand, the industry didn’t have much expectation from this four month period- interim budget and on the other hand; it had few adverse effects on the economy and especially financial markets. The interim budget gave away nothing yet left many asking if this was indeed the time to play it safe, politically. This interim budget had opened up new gates for the next fiscal and monetary policy by RBI in the coming period which might live up to high expectations towards economy. But looking at the current market conditions it will be difficult for RBI to make extraordinary changes. It’s an extremely dry budget as the major emphasis was on agriculture only. The hard-hit real estate sector had been leading the call for fiscal sops for it. This budget came as non-event for the entire corporate world as it would lead to one more year of uncertainty and investments.
The government had left out many things and is indirectly dependent on RBI & stimulus package, which might not be a luxury for economy. The government is mainly looking at new pump-priming, interest rate cutting kind of solutions; and they are not looking at new solutions for a new crisis. The government could declare excise holidays for items which are in great trouble like cars or even can add a special interest rates subsidy for new house buyers and many other things. Accordingly this government is handling this economic downturn and it is believed they would be able to handle it better than any new government coming up with various experiments, thus Dr. ManMohan Singh, the ball is still in your court.
Analysis Done by : Mr.Manik Gursahani
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