Just 6 weeks after a thumping victory in the election results, Mr. Arun Jaitley, the newly appointed Finance Minister of India announced the Union Budget 2014. Amidst high expectations and soaring market indices, it was always going to be a mammoth task to appease everyone. Like they say, No one knows what the formula for success is but the formula for failure is to try and please everyone. Having said that, we think the Union Budget presented by Mr. Jaitley has been a Pragmatic one and has addressed most of the stakeholders.
As the Hon’ble Finance Minister of India, made his maiden budget speech, it was clear the NDA Government is facing a trilemma. It has to keep prices under control, the exchange rate favourable and also get the economy on to a high-growth path. Given the limited time since being elected and current state of the economy, big bang reforms or populist measures were maybe not quite possible yet, but the budget has set the tone right and has all the ingredients to put India back on the growth track. No matter how you slice it, from hope to reality, Mr. Arun Jaitley has acknowledged the basic validity of the numbers presented in the interim budget for 2014-15 and has stuck to them. Although there hasn’t been total clarity on GST, GAAR and Retrospective tax amendments, his carefully worded speech has certainly infused some investor confidence back in the Indian markets. Several key issues of supply of clean drinking water, development of infrastructure, adequate healthcare and sanitation, job creation, education and skill development, encouragement of investments in manufacturing and promoting entrepreneurship amongst other things have been given serious attention and will be the driving force for overall development in the coming years. It would have been unfair to expect a lot in this budget given the current state of affairs. The anticipation is that we will see further clarity in terms of more rationalization & simplification of regulations and hopefully the big ticket items in the next full budget is presented in February 2015