The much-awaited National General Budget was presented on the desk of the Parliament by United Progressive Alliance’s Finance Minister Mr. P. Chidambaram. Much emphasis has been laid to improve the financial and social position of farmers of India…

“We have created an organization where every child in this country will say Chak-de Railways! Everybody is happy with the Railways.” Any guesses as to who could have said this? No doubt, it is none other than our beloved Railway Minister Mr. Lalu Prasad who has made this statement and wooed the “aam admi” with his extensive plans to modernize railways in a phenomenal way in his fifth Railway Budget. He certainly knows the art of drafting brilliant budgets, and he unfailingly comes up with ideas that would fetch him great political mileage. Not disappointing us in any way, this year too he makes his statement in style.

At the outset of the parliamentary session on the Budget, he kick-started his speech with statistics describing his work in the past 4…

The budget is the basic financial statement of India. It is comparable to a household budget, but in a larger sense. Like we decide how much we will spend for food, how much on eating out, how much will we need to pay the servants and how we will manage all this with our existing income? This is budget.Under article 112 of the Constitution, a statement of estimated receipts and expenditure of the Government of India has to be laid before Parliament in respect of every financial year which runs from 1st April to 31st March. This Statement titled “Annual Financial Statement” is the main Budget document. The Annual Financial Statement shows the receipts and payments of Government Under the three parts in which Government accounts are kept: (i) Consolidated Fund…

Cement stocks hit rock bottom when finance minister P. Chidambaran announced the differential excise duty structure, despite the tight demand -supply ratio, which is not expected to change for the next one year.  Though market experts rated the budget effect on the cement sector as neutral, the top five cement stocks which control 50% of the manufacturing capacity, corrected to a great extent and all long term investors who did not book their profits earlier on ended up making a loss on their investments. Like many other investors, I made a loss in Associated Cement Company Limited (Acc) which is the second largest cement company of India.If we review the budget for the last 3-4 years, one can see that the treatment given to the cement sector has been topsy-turvy.In…

It has been nearly sixty years since Independence, and agriculture continues to be the backbone of the Indian economy and the image reflection of India. Although the Green Revolution in the 60s brought about an immense and self-sustainable positive change in the agricultural sector of India, but the need to suit this to the changing times in the national and global scenario is what the annual budget must aim to achieve.The Economic Survey, 2007, highlighted the problems of the agriculture sector as low level of public investment, exhaustion of the yield potential of new high yielding varieties of wheat and rice, unbalanced fertilizer use, low seeds replacement rate, an inadequate incentive system and post harvest value addition. Also, the inadequate infrastructure facilities, a problem which plagues all other segments of…

This Budget, we will be able to see a major ramp up in public expenditure in order to enhance physical infrastructure and increased social sector spending. A fiscal impetus can also be provided through a cut in indirect tax rates.  The FRBM Act mandates the government to decrease the fiscal deficit to at least 3 per cent and reduce revenue deficit to zero by March 2009. The Planning Commission is opposed to such constraints on public expenditure as it limits the government’s ability to fund flagship initiatives aimed at developing rural infrastructure. There is a greater need of infrastructure development in rural areas then in the urban area where there is already a lot of private investment in infrastructure. Private players show little or no interest in rural areas because such projects…

Yet another Union Budget is going to be launched this February 28th, 2008. One of the major highlight’s of the budget is the fact that it is the last budget the UPA government presents before the general elections of 2009. Hence, we expect a people friendly budget this year which aims at enriching the vote bank. I hope that this year the budget allocates special funds for higher education, especially in the research and development section. India, as we know is a developing nation. For such a nation, better science and technology development is not a luxury, but an absolute necessity to participate in the world’s fast forming, knowledge-based economy. In order that our country keeps pace with the developed world, India has to step up the number of research and…

The Budget 2008, to be released on 29th February is already under great speculation. There are different demands from different sectors. Through this article I wish to talk about the corporate tax rates and how the Budget 2008 might affect them.Corporate Tax refers to the tax levied on the profits made by companies. Tax rates generally vary depending on whether the profits have been distributed among the shareholders. Further, the gross profits are calculated after deducting the capital expenditure and the amount of interest payments. In 2005, the corporate tax rate was brought down from 35% to 30%. However on adding surcharge and cess it stands at 33.9%.Foreign companies were charged 42.5% including surcharge. This year there is once again a demand to reduce the corporate tax rates. India Inc…

Gujarat elections have put down all chances of Congress calling for early polls. Elections in many states are due this year, so the undoubtedly, the Prime Minister and the Finance Minister must be in tremendous pressure to produce a populist budget keeping their political imperatives in mind. The Indian Government may raise the tax exemption limit to Rs. 1.25lacs this year from the existing Rs. 1.10lakh, but the tax rates are expected to remain the same. Polls are due in Delhi too, and with Delhi having a large number of salaried employees, the Government may try to help them tackle the rise in the food prices. The FM will certainly try to keep the economy rate in somewhere between 8-9% despite the global sluggishness in the US and amidst the appreciating…

Its that time of the year when industry leaders, economists and business confederations are preparing their wish-list to be forwarded to the Finance Ministry. Pre-budget preparations have begun for the Annual Budget 2008-09 to be presented in the Parliament on 29th Feb 2008.Indian Finance Minister Palaniappan Chidambaram preparing his fifth consecutive budget said that his cause of concern will be some sectors that are under stress due to rupee appreciation. The FM pointed out that there has been an unsatisfactory delivery of promised goods and services but was positive that there is enough time for improvement in that area.The FM refused to accept the next budget as an “election budget” but said that his next budgetary exercise will be the last “full budget” of the UPA government. He said that…