JOIN US With less than three days to go for the Union Budget, expectations are running high. In a CEOs’ Opinion Poll, conducted by industry body CII, the results show that the industry is pinning its hopes high on the Budget, to be presented on February 28.
The recently conducted CII Poll had questions revolving around ‘Government Finances’, ‘Policy Reforms’ and ‘Processes and Implementation’ as the key heads.
Sustained GDP growth is essential for tax revenue buoyancy, and growth recovery needs a capex stimulus. Capital expenditure was budgeted at Rs 2.3 lakh crore in 2014-15 and is still falling short.
According to CEOs polled, the majority believe that an increase in capital expenditure outlay in fiscal 2015-16 will be budgeted at Rs 70,000 crore.
To fund this capex, apart from subsidy rationalisation, revenues can be augmented through aggressive disinvestment of government holdings in PSEs. While the disinvestment target in 2014-15 was Rs 63,000 crore, the CEOs expect this to be Rs 75,000 crore and above next fiscal.
On the critical figure of fiscal deficit, the majority of CEOs believe that this would be between 3.7-4 per cent of GDP.
Significantly, the CEOs believe that a framework for GST would be announced, which would tilt the balance towards higher GST rate, in the interest of revenue neutrality. On GAAR, the CEOs were unanimous in their expectation of a two-year deferral.
Pinning hopes on the government’s ability to navigate key policy reforms through the parliament, majority of CEOs believe that the government would be able to regularise the eight ordinances that were issued between the last and this session of parliament.