The Union Budget 2014-15
presented by Finance Minister Arun Jaitley has laid an infra tarpaulin
& created a mood for growth. An eBiz integrated portal where all ministries
would be integrated by December is underway to facilitate business. The
allocations are across the spectrum of infrastructure, manufacturing and social
sectors. The intent to inject a booster shot for the manufacturing sector has
been attained by protectionism against imports. This will lead to enhancement
of industrial capacities for large and also for medium & small companies
due to the extension of investment allowance benefits for small sized
companies. Further with FDI being eased to 49% for manufacturing in defence
sector and easing of finance for SME & MSME sectors, the sector will get
the much required trigger. Nearly $ 8 billion have been allocated to kick off
the road sector and another $ 8 billion for the urban infrastructure sector. Another
15000 km of gas pipelines, housing for all by 2022, water & irrigation,
education, rural infra are part of the whole infra push but emphasis on use of
technology is a common denominator. Smart cities have been allocated Rs 7060 cr
which is but a small step in the gargantuan opportunity ahead. They have also been
identified as industrial cities among industrial clusters & corridors. Masterplanning
& urban renewal have been brought centre stage which will make our
forthcoming “SM@RT CITIES SUMMIT” being organised on Aug 22-23 at Four Seasons,
Mumbai most relevant and vital. Low cost housing will get an impetus with
restrictions being lifted for FDI on size and investment amount if 30% of the
project is reserved for low cost housing. Since slum redevelopment is now
considered part of CSR it can potentially attract large funds. Introduction of
REITs for real estate and Investment Trusts for infrastructure will win FDI as
the ‘pass-through’ facility has been provided where the fund does not get taxed
on gains and only the individual who gains pays, thereby clarifying a
prospective double taxation issue. Further initiatives have been integrated
such that for e.g. the thrust of renewable energy particularly solar, has been
etched in each initiative which can multiply the impact. Industrial corridors
& SEZs are being vitalised too. India’s economy at $2.3 trillion is staged
to grow to 5.4% to 5.9% as per the Economic Survey from 4.8%. Just a half
percentage point jump in growth, say, from 4.8% to 5.3%, will add, at current
GDP levels, $11.5 billion to the economy. The arsenal presented by the FM is
all set to go beyond. To conclude, the FM has laid out the vision of the Modi
sarkaar for India to leapfrog on trampoline of infra.
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