Budget

Union Budget FY16 & Strategy: Finally growth gets a chance
UnionBudgetFY16&Strategy:Finally,growthgetsachance
Strategyteam
KapilGupta
+912240635406
kapil.gupta@edelweissfin.com
February 28 2015
February28,2015
UnionBudgetFY16:Finally,growthgetsachance
Fiscalmath:Wegotwhatweaskedfor
Theeconomyhasgotthefiscalpolicyitneeded.FiscaltargetshavebeenrelaxedforFY16from3.6%(underFRBM)to3.9%,
andthemediumtermfiscaltargetof3%hasbeenpushedoutbyoneyear.
Thus,fiscalimpetustotheeconomywillturnmildlyfavourableafterbeingadverseforpast5years.Infrastructure(roads,
railways)isthekeythrustarea.Crucially,allthisisdonewithoutcompromisingonthecredibilityoffiscalmath.
Policy reforms: The common thread is fiscal consolidation, innovatively
Policyreforms:Thecommonthreadisfiscalconsolidation,innovatively
Thegovernmentscommitmenttothepathoffiscalconsolidationiswellshowcasedbyitsseriousnesswithregardsto:1)GST
sizeableallocationofGSTcompensationtothestateslastyearandhandsomeprovisionsforFY16;2)swiftprogressondirect
benefittransfersthroughJAMtrinity(JanDhanAadharMobile)tomakesocialtransfersleakageproof;and3)amore
simplifiedtaxstructure(lowercorporatetaxratewhileeliminatingexemptions)toallowforbettercompliance.
Easeofdoingbusiness:Connectingthedots
The finance minister (FM) mentioned several initiatives revampingthebankruptcylawtomatchglobalstandards,introducing
revamping the bankruptcy law to match global standards introducing
Thefinanceminister(FM)mentionedseveralinitiatives
thePublicContracts(ResolutionofDisputes)Billtomakeconflictresolutionlesscumbersome;revisitingthePPPmodelto
reduceprivatesectorrisks,andconsideringplugandplaymodelforpower,roads,etc.Allthistakentogethermeansabigpush
totheeaseofdoingbusiness.
Encouragingfinancialsavings
TheBudgetmadeaclearattempttoencouragefinancialsavingsbygivingtaxincentivesonhealthinsuranceandpension,and
offeringschemesongold sovereigngoldbond(afinancialassetasanalternativetogold)andthegoldmonetisationscheme,
h h ll h l
d
h ll
f h
l ld
f
whichwillhelpreducetheallureofphysicalgoldasameansofsaving.
2
UnionBudget(Cont)
Whatwedidnotget?
Lackofspecificannouncementwithregardstoaffordablehousing,inadequateprovisionsforpublicsectorbanks
recapitalisationandabsenceofpolicymeasurestoaddresstheissueofexistingstressedassetsweresomeofthe
disappointmentsintheBudget.Wehopesomeof theseissueswillgetaddressedoutsidetheBudget.
EquityStrategy:Westickwithwhatwehave
Atthecostofbeingimmodest,wehavegotwhatwewerelookingfor
At
the cost of being immodest we have got what we were looking for growthreboundwithgovernmentpush
growth rebound with government push private
private
consumptionwillpickupasconsumersreassesshigherrealincomes.
Wehavelittleideawhatmarketswilldointhenearterm,especiallygiventherecentmarketmoves,butstillremainconvinced
thatmarketsareaBuywitha1218monthstimeframe.Wehavelongarguedthatapartfromearningsgrowth,valuationswill
bepositively influencedbyfallinginterestrateexpectationsandconsequentlylowerriskfreerates thisfundamentally
impactsvaluations.
Earlycyclicalsremainbestbets.WearegettingmorebiasedtowardsPSUbanksandareevaluatinghigherweightages.EPC
companiesarethebiggestbeneficiariesoftheBudget.
i
h bi
b
fi i i
f h B d
Fiscalmathcredible
Fiscal target relaxed; to be growth supportive after five years

Fiscaldeficittargetsrelaxed
thusfiscalimpulseturnsgrowthsupportiveafterfiveyears
7.0
1.5
Mediumtermfiscal
deficittargetof 3%
pushed out by a year
pushedoutbyayear
1.0
5.0
(%ofGDP)
(%ofGDP)
6.0
4.0
3.0
0.5
0.0
(0 5)
(0.5)
2.0
FY10
FY11
FY12
FY13
FY14
GrossFiscaldeficitasa%ofGDP
FY15
(RE)
FY16
(BE)
FY17
(1.0)
FY18
FY10
FRBMFiscaldeficittargets
FY11
FY12
FY13
FY14
FY15(RE) FY16(BE)
Fiscalimpulse(asa%ofGDP)
Source:CMIE,Edelweissresearch
Note:Fiscalimpulseiscalculatedasfiscaldeficitexcludingassetsales
FiscaldeficittargetforFY16hasbeenrelaxedto3.9%ofGDP(from3.6%)whilecommittingtoachieving3%targetbyFY18(vs
FY17plannedearlier)
Asaresult,thefiscaldragseeninlast5yearswillend.Indeed,therewillbemodestsupporttothegrowthfromthefiscalside.
As a result the fiscal drag seen in last 5 years will end Indeed there will be modest support to the growth from the fiscal side
Thisisamuchneededtrendreversal,giventhestateofprivatesector.
Credibleandgrowthsupportivefiscalmath
Particulars(asa%ofGDP)
TOTALREVENUES
Taxrevenue(net)
GrossTaxrevenue
Incometax
Corporatetax
Customstax
Exciseduties
Servicetax
Less:Transfertostates
NonTaxRevenue
Dividends
Telecomand3G
Disinvestment
TOTALEXPENDITURE
Revenue
Interestpayments
Defence
Subsidies
Foodsubsidy
Fertiliser subsidy
Fertilisersubsidy
Petroleumsubsidy
Policeandpensions
Grantstostates(FCrecos)
GSTcompensationtostates
Developmentrelated
Others
Capital
Defence
Developmentrelated
FISCALDEFICIT
FY16(BE)
8.7
6.5
10.3
2.3
3.3
1.5
1.6
1.5
3.7
2.1
0.7
0.3
0.5
12.6
10 9
10.9
3.2
1.1
1.7
0.9
0.2
0.5
1.0
0.6
0.1
2.8
0.3
1.7
0.7
1.0
3.9
FY15(RE)
9.2
7.2
9.9
2.2
3.4
1.5
1.5
1.3
2.7
2.1
0.7
0.3
0.2
13.3
11 8
11.8
3.2
1.1
2.1
1.0
0.5
0.6
1.0
0.5
0.1
3.4
0.3
1.5
0.6
0.9
4.0
FY14
9.3
7.2
10.0
2.1
3.5
1.5
1.5
1.4
2.8
2.1
0.8
0.4
0.3
13.7
12 1
12.1
3.3
1.1
2.2
0.8
0.8
0.6
1.0
0.5
0.0
3.6
0.3
1.7
0.7
1.0
4.4
FY13
9.1
7.3
10.2
2.0
3.5
1.6
1.7
1.3
2.9
1.8
0.5
0.2
0.3
13.9
12 3
12.3
3.1
1.1
2.5
0.8
1.0
0.6
1.1
0.4
0.0
3.7
0.3
1.6
0.7
0.9
4.9
Source:Budgetdocuments,Edelweissresearch
BE:BudgetEstimates;Note:ForfiscaldeficitsummaryINRbn andYoY%pleaserefertoannexure
6
FY12
8.8
7.0
9.9
1.8
3.6
1.7
1.6
1.1
2.9
1.8
0.6
0.2
0.2
14.5
12 7
12.7
3.0
1.1
2.4
0.8
0.8
0.8
1.0
0.5
0.0
4.2
0.3
1.8
0.8
1.0
5.7
Fiscalmathlookscredible,unlikelastcouple
ofyearswhenrevenueprojectionswere
missedwildly
Subsidieswellprovided
FinanceCommission(FC)recommendations
Finance
Commission (FC) recommendations
implemented.Taxdevolutiontostatesisupby
10%;hencedevelopmentorientedgrantsto
stateshavebeenreduced
Importantly,theFMhasadequatelyprovided
forGSTcompensation
7th paycommissionrecommendationsand
higheroilpricescouldbethemainchallenges
TaxRevenues:Prudentbudgetingafteralongtime
Sharpjumpintaxrevenuesbudgeted
Particulars(YoY)
GrossTaxrevenue
Incometax
Corporate tax
Corporatetax
Customstax
Exciseduties
Servicetax
12.5
11.5
10.5
9.5
FY16(BE)
16
18
10
10
24
25
FY15(RE)
10
15
8
10
9
9
FY14
10
21
11
4
(4)
17
FY13
17
22
10
11
22
36
FY12
12
18
8
10
5
37
8.5
FY16(BE)
FY15(RE)
FY14
FY13
FY12
FY11
FY10
FY09
FY08
FY07
FY06
FY05
FY04
7.5
FY03
(Centralgrosstaxrevenueeasa%of
GDP)
Improvedbuoyancyowingtohigherindirecttaxes
Keychangesinthetaxrateswerehikeinservicetaxfrom12.36%currentlyto~14%inFY16.
y
g
y
TheFY16taxprojectionsarecredible.Grosstaxbuoyancyof1.4isachievablegivenhikesinservicetaxandexcisedutieson
petroleumproducts.
Fiscalfederalism:Givingmoreautonomytothestates
Stateswillnowhavemoreautonomytodecidespending
%ofGrosstaxrevenue
Totaldevolutiontostates
Taxdevolution
Developmental grants to states
Developmentalgrantstostates
Financecommisiongrants
Others
FY15(RE)
56.0
27.0
22 2
22.2
5.2
1.6
FY16(BE)
58.1
36.1
14 1
14.1
6.1
1.7
Note:Thedivisiblepoolisgrosstaxrevenueminussomeofthecessoneducation,SwatchBharat,etc.
Asperthefinancecommissionrecommendations,theshareofstatesintheoveralldivisibletaxpoolhasincreasedfrom
32%to42%(orfrom27%to36%asshareofgrosstaxrevenue)
Hencegiventhehighertaxdevolution,theshareofdevelopmentalgrantstostates(whichweremainlydesignedbycentre)
havebeenreducedfrom22%to14%ofgrosstaxrevenues.
Expenditure:LooksdepressedundernewFCrecommendations
Expenditure%YoY,withandwithoutFCrecos
20.0
(%,YoY)
17.0
14.0
11.0
80
8.0
5.0
FY10
FY11
FY12
FY13
FY14
FY15
FY16
Expendituregrowth
E
ExpendituregrowthwithoutFCrecommendations
dit
th ith t FC
d ti
ThebudgetedFY16expendituregrowthisjust6%YoY,butthismainlyduetofinancecommissionrecommendations,which
g
p
g
j
y
devolvehighertaxestostatesandreducethecentralgovt.sdevlopmentalexpenditure.
IncaseFCrecommendationswerenotimplemented,expendituregrowthwouldbe~14% highestinlastfiveyears.
However,aliketolikecomparisonofcentralgovt
However a like to like comparison of central govtssdevelopmentalexpenditureisnotpossible.
developmental expenditure is not possible
Roadsandrailwaysthekeythrustareas
200
60.0
150
48.0
100
36.0
50
24.0
12.0
(50)
(Totalcapitaloutlay,%YYoY)
(Totalcapitaloutlay,%YYoY)
Roadsandrailwaystowitnessasharpjump
0.0
FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16
R d (% Y Y)
Roads(%,YoY)
R il
Railways(%YoY,RHS)
(% Y Y RHS)
Ontheinfrastructureside,roadsandrailwaysseemtobetheclearfocusareasofthegovernmentwiththetotaloutlay
,
y
g
y
(budgetarysupport+internalresources)inthesesectorsexpectedtoincreaseby~52%and175%YoY.
Onthefundingofthetotaloutlay,thebudgetarysupportforboththesesectorswouldaccountforonly30%ofthe
incrementalfunding.
TheFMhasalsotalkedaboutsettingupNationalInvestmentFund(withgovernmenttransferofINR200bn)whichcanraise
additionalresources
10
Subsidies:Wellbudgeted;oilarrearscleared
F d
Food
F ili
Fertiliser
E
Energy
(Asa%ofGDP)
FY16(BE)
1.0
FY15(RE)
0.0
FY14
1.4
FY13
0.3
FY12
1.8
FY11
0.6
FY10
2.2
FY09
0.9
FY08
2.6
FY07
1.2
FY06
3.0
FY05
1.5
FY04
(Asa%ofGDP)
Subsidiesas%ofGDPexpectedtodecline
T l S b idi (RHS)
TotalSubsidies(RHS)
Subsidiesasa%ofGDPareexpectedtoreduceto~1.7%ofGDPfrom2.1%inFY15.Thereductionismainlyontheoilfront
(0.3%ofGDP),whereloweroilpriceshaveprovidedasignificantcushion.
WhatsmorehearteningisthatpendingFY14oilsubsidyarrearsof~0.3%ofGDPhavealsobeencleared
Also,inordertoimprovetheeffectivenessofsubsidies,governmenthasalreadyrolledouttheDirectBenefitsTransfer(DBT)
Also
in order to improve the effectiveness of subsidies government has already rolled out the Direct Benefits Transfer (DBT)
schemeforLPG.Goingahead,ifthisisextendedtofooditcouldresultinsignificantsavingstotheexchequergiventhe
extentofleakages.
11
Whatdoesallthismeanformonetarypolicy?
Wedonotthinkrelaxationinfiscaltargetswillunderminethescopeofmonetaryeasing.
WhatDrRajan commentedonfiscaldefict?
Itisnotthatwearelockedtointoaspecificnumberoraspecificpath,butitistheoverallpackagewhetheritmakesfor
It
i
t th t
l k dt i t
ifi
b
ifi
th b t it i th
ll
k
h th it
k f
serioushighqualityfiscalconsolidationovertimethatclearlywillimpactinflationaryforcesthatwearemostworried
about
Media
MediainteractiononFebruary3,2015
interaction on February 3 2015
ClearlyRBIGovernorwouldseeBudgetasapackageandisnotlookingforspecificfiscaltarget.Theextrafiscalspace
generatedisanywayusedupinboostingcapacitycreationintheeconomy,whichhasafavorableimpactoninflationinthe
longerterm.Thus,RBIshouldseeitfavourably.
Also,apushforGST(throughincreasedcompensationtostates)andDirectbenefitstransfer(DBT)indicategovernments
commitmenttohighqualitymediumtermfiscalconsolidation.
12
Borrowing:LargelyunchangedcomparedtoFY15
Fundingofthefiscaldefecit
Financingoffiscaldeficit(INRbn)
Debtreciepts
Grossmarketborrowing
Net market borrowing
Netmarketborrowing
Shorttermborrowing
externalassistance
Securitiesagainstsmallsavings
StatePF
Others
Drawdownincashbalance
FY16(BE)
5,436
6,000
4,564
301
112
224
100
136
120
FY15(RE)
5,283
5,920
4,469
512
97
333
100
(228)
(157)
FY14
5,220
5,637
4,536
77
73
124
98
59
(191)
FY13
5,412
5,580
4,674
534
72
82
109
(62)
(506)
RE:RevisedEstimates,BE:BudgetEstimates
Netbudgetedborrowing,hasbeenmoreorlesskeptunchangedcomparedtotheFY15atINR4.6tn.
13
Policyreformsandannouncements
14
Highqualityfiscalconsolidationoverthemediumterm
WhiletheFMhasrelaxedthefiscaltarget,governmentscommitmenttothepathoffiscalconsolidationiswellshowcasedbyits
seriousnesswithregardsto
CommitmenttoGST:TheFMmadethefirstallocationtowardsGSTcompensationinFY15andprovidedadequately
(
(~INR150bn)inFY16.ThisislongoverdueandwillhelpgettingstatesonboardforimplementationofGST.Inaddition,hikein
1 0b ) i
16 hi i l
d
d ill h l
i
b df i l
i
f GS
ddi i
hik i
servicetaxalsoseemstobeasteptofacilitateGSTimplementation.FurthertheFMreiteratedthedeadlineforGST
implementationtobeApril2016.
Swiftprogressondirectbenefitstransfer:
Swift
progress on direct benefits transfer: Governmenthasalreadycovered125mnfamiliesunderJanDhan
Government has already covered 125mn families under Jan Dhan andisalready
and is already
providingLPGsubsidytomorethan10mn beneficiaries.Theagendaistomakethesocialbenefitstransfersleakageproof
usingJAMtrinity(JanDhanAadharMobile).Perhapsthenextstepwouldbetoimplementdirecttransfersforfoodsubsidy
Moresimplifiedtaxstructure: TheFMhaslaiddowntheroadmapforreducingcorporatetaxratefrom~30%currentlyto25%
overthenext4yearsstartingnextyearwithsimultaneouswithdrawaloftaxexemptionsandincentives.Thiswouldimprove
complianceandhencegovernmentstaxrevenues
15
Enhancingtheeaseofdoingbusiness
TheFMmentionedaboutseveralinitiativeswithregardstoeaseofdoingbusiness:
Settinguptheebizportal:Thiswouldintegrate14permissionswithonesource
IntroducingaPublicContracts(ResolutionofDisputes)Bill:
Introducing
a Public Contracts (Resolution of Disputes) Bill: Thecurrentconflictresolutionistimeconsumingand
The current conflict resolution is time consuming and
cumbersome,whichinturnleadstocostoverruns.Thegovernmentplanstoreducethetimelinesofdisputesettlements.This
isasignificantpositiveforinfrastructurespace.
RevisitingPPPmodel: Thenewmodelplanstoincreasethesovereignrisk,thusmakingitmoreviablefortheprivatesector.
Plugandplaymodelforpower,roadsetc.: Allclearancesandlinkageswillbeinplacebeforetheprojectisawardedbya
transparentauctionsystem
Revampingthebankruptcylawtomatchglobalstandards
p g
p y
g
16
Otherkeypolicysteps
Boostingfinancialsavings:Budgetshowsaclearattempttoencouragefinancialsavings givingtaxincentivesonhealth
insuranceandpensionandofferingschemesongold sovereigngoldbond(afinancialassetasanalternativetogold),gold
monetizationschemewhichwillhelpreducetheallureofphysicalgoldasameansofsaving.
Monetarypolicyframework:TheFMstatedthatprocessofformalizingnewmonetarypolicyframeworkiscompleteandhe
li f
k h
d h
ff
li i
li f
ki
l
dh
wouldbelookingtosetupmonetarypolicycommittee,muchonthelinesofwesterncentralbanks.
Fixingtheinverteddutystructure:Theinverteddutystructure(dutiesonfinishedproductarelowerthanonrawmaterials)is
one of the deterrents in domestic manufacture of several products In the current budget the inverted duty structure has
oneofthedeterrentsindomesticmanufactureofseveralproducts.Inthecurrentbudget,theinverteddutystructurehas
beencorrectedinsomeofthesectorssuchaselectronics,commercialvehicles,etc.Thisisanimportantstepstowards
realizationofthePrimeMinistersMakeinIndiacampaign.
17
Whatwedidnotget?
Intherunuptothebudgettherewerelotofexpectationsregardingaboosttoaffordablehousing.WhiletheFMreiterated
governmentscommitmenttohousingforall,thespecificswereclearlymissing.
GiventhelargerecapitalizationrequirementofthePSBs,theprovisionsmadeinthebudgettowardsthesame(~INR80bn)
werequiteinadequate.
i i d
Absenceofpolicymeasurestoaddresstheissueofexistingstressedassetswasalsodisappointing.
18
SectorwiseAnnouncements
19
Automobiles
Sector
Auto
Industry/marketwishlist
Providesubsidiestoboostelectricvehicles
Edelweissexpectations
Canprovidebothdirect(lowerprice)
andindirectsubsidies(infrastructure
etc)
AnnouncementsinBudget
AllocatedINR750mnforElectric
vehicles;
Impactonsector/company
PositiveforM&M
RaisedcustomsdutyonCVsfrom10%
Raised
customs duty on CVs from 10% Nomajorimpactasthereisvery
No major impact as there is very
to40%
limitedimportsofCVs
Rationalisehigherexciseratestructureon
SUVs
Incentivestopromoteexports/R&D
CanbeapartofroadmapforGST
Partof"MakeInIndia"campaign
20
GSTtobeimplementedfromApril
2016
PositiveforM&M
Positiveforindustry
BFSI
Sector
BFSI
Givearoadmapforreductionof
governmentstakeholdinginPSUbanks
(PSBs)andimprovedgovernance
Itiswidelyexpectedthatgovernment
willworktowardsreducingits
interferenceinPSBs(asthiswasone
y
y
ofthekeyissuesdiscussedinGyan
Sangam).Thereisalsoapossibilityof
reducinggovernmentstakebelow51%
inPSBs
Governmenthasproposedtosetup ThecreationofBBBandBICwillhelp
BankBoardsBureau(BBB,toappoint inselectionofanindependentboard
andempowerindividualbankboards) thatwillfurtheraidinvariouslonger
j
p
g,
structureandthenmovetoBank
termobjectivesofcapitalraising,
InvestmentCommittee(BICstructure, variousconsolidationaspectsandHR
inlinewithNayakcommittee
policiesamongothers.However,
recommendation).
lowerthanexpectrecapitalization
benefitforthePSUbanks(INR79.4bn
versusINR112bnannouncedin
previousyearbudget)waskey
dissapointment.
Givearoadmapprovidingsolutiontoasset
qualityproblemsforthebankingsystem
Weexpectannouncementsofafew
reformswithrespecttosettingupofa
NationalARCandenhancingpowers
ofDRTandSARFESI(reducinglegal
hurdles)
Announcedtostrengthenvarious
recoverymechanismcomprehensive
bankruptcycodetobeimplemented
byFY16(frameworkforthesamewill
comeoutinnearfuture).
SARFAESIwillbemadeapplicableto
NBFCs
Sometaxsopswithregardtoaffordable
housing
h
i
Givenvisiontoprovideaffordable
h
housingforallby2020,weexpect
i
f
ll b 2020
t
sometaxsopstobeannounced
towardsthesame
DTCimplementation
21
ThiswillbeapositiveforPSUbanks
whicharecurrentlyreelingunder
assetqualitypressure.
CurrentlySARFAESIActwasNOT
availabletoNBFCsandHFCs
incorporatedafter2005:nowthese
companiesbeingconsideredfinancial
institutions and resort to SARFAESI
institutionsandresorttoSARFAESI
willbeverypositiveforNBFCshaving
exposuretomortgagesandbusiness
loans
Noannouncementonthisfront
Thiswasasurprisegivengoevrnment
th t
thrustonaffordablehousing.
ff d bl h
i
Governmentannouncednomajor
incentiveforDirecttaxcode(DTC)
implementation
ThiswillbepositiveforInsurance
companies(MaxIndia,BajajFinserv
etc)asDTCsoughttoincreasethetax
rateforthem
BFSI(contd)
Sector
Introductionofcompositecapforforeign
investment
Governmentproposingtointroducea Thiswillbechangeforbankwhich
compositecapforforeigninvestment havehit49%FIIcapbuthavelimits
(FDI+FII)withthisthesectorcapof onoverallForeigninvestmentcapof
49%inbankswillgoaway
74%providingroomforFII
g
y
p
g
investmenttogoup.Webelieveitwill
bepositiveforYesBankandAxis
Bank.Furthertothisweseeitwill
improveonYesbankschancestoget
includedintheMSCIindexgiventhe
FIIinvestmentbenefitavailable
MergerofFMCandSEBI
Governmenthasproposedtomerge
FMC(whichregulatesforward
tradingofcommodities)withSEBI
(capitalmarketregulator)
22
WeseethisasabigpositiveforMCX
asFMCpresentlyinthepresent
avatardoesnothaveany
infrastructure,theydon'thave
manpower,theydon'thaveanyraid
andpanelprovisionstotakeaction
againsttheDabbatraders.Sothe
biggestbenefitincasethemergerof
FMCwithSEBItakesplacethenthat
powerwillcomeSEBIhasa
ill
SEBI h
bandwidthorthemergerwillbethe
rightstep,andinvestorconfidence
mightcomebackastheregulatorwill
haveastrongpanelaction.Interms
of introduction of options for
ofintroductionofoptionsfor
commoditiesandparticipationof
institutionsincommoditytrading,
SEBIwillbemoreproactivein
allowingthesametherebyaiding
volumes
CapitalGoods
Sector
Capital
Goods
Defence
AnnouncementonSmartCitieswithspecific
impetusonrailways,T&Dnetwork,solar
poweretc.
Expectingspecificpoliciespromoting
SmartCitieswithreasonablefund
allocation
Noannouncement
Negative
Announcementofnewpowergeneration
Announcement
of new power generation
projectsinUMPPcategory
NA
Identificationof5UMPPsof4000
Identification
of 5 UMPPs of 4000
MWeachinplugandplaymode
It is positive for players like BHEL

ItispositiveforplayerslikeBHEL,
L&T.Alsowithplug&playmodel
projectexecutioncouldalsobebetter.
BoosttoRenewablepower
NA
Targetof175GWofrenewalcapacity Positiveforequipmentplayerslike
by2022(additionof145GWover8 Suzlon,AlstomIndia,BHEL
years) across solar wind hydro & bio
years)acrosssolar,wind,hydro&bio
mass
Higherrail&roadbudgetaryallocation
NA
Hikeinallocationforrailwaysby
INR100bnandroadsbyINR140bn,
resp
PositiveforL&T,Siemens,ABB,
Cummins.
CreationofdefenceSEZs/infrastructure
statustodefencemanufacturing
Reasonableprobabilityforthese
announcements
Noannouncement
Negative
Higherallocationforcapitalspending
Expecthikeinallocationforcapital
equipmentespeciallyforhiend
equipmentprocurement
Capitalexpenditureincreasedby
15.4%toINR946bn.Theproportionof
capitalexpenditureintotaldefence
budgetincreasedto38.3%against
36.9%lastyear.Positiveforthe
defencesector.
Whileitisgenerallypositiveforthe
sector,itwillbepositiveforboth
largecompanieslikeBEL,L&T,and
componentsupplierslike
Walchandnagar,CentumElectronics,
AstraMicrowaveandBharatForge
etc.
23
Cement
Sector
Cement
Uniformrateofexcisedutyoncement:For
bettercomplianceandtoavoidlitigation,
industryhadsuggestedthatexcisedutyon
p
cementandclinkershouldbeprescribedon
advalorembasisonly.
Nochange
Effectiveexcisedutyincreasedfom
12.36%to12.5%andthefixed
componentofINR120/tincreasedto
/
INR125/t
Negligibleimpact
Increaseinservicetaxfrom12.36%to Theincreaseinservicetaxonfreight
14%
willleadtoamarginal(~1%)increase
inthefreightcostforcompanies.
CleanEnergyCessincreasedby
Cl
E
C
i
db
INR100/t
24
Thepower&fuelcostofcompanies
Th
&f l
t f
i
willincreasemarginallyby<2%.Both
theabovementionedcosthikeswill
bepassedontoconsumers.
ConsumerGoods
Sector
Consumer Noincreaseinexcisedutyoncigarettes
Goods
Theconsecutivehikesinexicseduty
inthepast3budgetscoupledwith
VATratehikesareimpactingvolumes
y
oftheindustry.AsseenfromQ3FY15
results,excisecollectionwasflattish
forthegovernmentasvolumeshave
declinedsignificantly.Weexpectthis
yeartheexcisedutyhikeoncigarettes
willbesoftercomparedto1172%
hikesinFY14
Tookaweightedaveragehikeof~16%
incigaretteswhichisthefourth
consecutivesharphike.Exciseduty
y
g
hasbeenhikedby25%forcigarettes
below65mmcategorywhileforother
cigarettesizethehikeisby15%.
Negativeforallthecigarette
companiesasitisthefourth
consecutivehike.Thoughcompanies
p
y
willbeabletopassontheduty
increasebutitwillhaveaimpacton
theirvolumegrowthandthereby
earnings.
GSTdeadlinetobeannounced
WeexpectGSTdeadlinetobeset,
thoughimplementationiskey
Expectedtobeimplementedfrom
April2016
GSTwillhelpsimplifytaxstructure,
reducesignificanceofunorganised
players,makinginventoryplanning
morerobustandreduceblack
marketing
Initiativesoninfrastructuredevelopment
Goingbythegovernment'smanifesto
weexpectincreaseinhousingand
infrastructuredevelopmentpolicies
HousingforallthefamiliesinIndia
by2022.Thegovernmenttargets
20mnhousesinUrbanand40mn
housesinruralby2022.
Positiveforpaintcompanieslike
Asianpaints,BergerPaintsetcandfor
PidiliteIndustries.
Cutintaxes
Rural initiatives on income generation

Ruralinitiativesonincomegeneration
Reductioninthecorporatetaxrate
PositiveformostoftheFMCG
from30%to25%over4yeartime
companieswhichpaytaxrateatthe
frame.Alsoreductioninthecorporate maximummarginalrateof30%.
exemption.
Weexpectthistocontinue,though
We
expect this to continue though
growthcouldmoderateasmorefocus
willbeonurbanrevival
25
Continuessupporttoincreasingthe
Continues
support to increasing the Positiveformostofthecompanies
Positive for most of the companies
ruralwagesthroughruralinitiatives
andruralspecificfunds.Allocated
INR347bntowardsMGNREGA.
Construction
Sector
Construction Formulatingguidelinesforchannelising
fundsfromforeigninvestorsaswellas
domesticsavingstowardsinfrastructure
funding
Likely
EstablishmentofaNational
InvestmentandInfrastructureFund
Positive
Governmentwillintroducea
regulatoryreformlawtoamendthe
regulatoryframeworkinvarious
sectorsofinfrastructure
Positive
PubliccontractdisputeresolutionAct
Public
contract dispute resolution Act Positive
tobeintroducedwhichwillaimat
reducinglitigations/disputesininfra
projects.
AnadditionalsumofRs.40,000crore Positive
for investment in roads and other
forinvestmentinroadsandother
infrastructurewillbemadeavailable
throughconversionofexistingexcise
dutyonpetrolanddieseltotheextent
ofRs.4perliterintoRoadCess
G
Governmentwillpermittaxfree
t ill
it t f
P iti
Positive
infrastructurebondsfortheprojects
intherail,roadandirrigationsectors
26
IT
Sector
IT
Relieffromapplicabilityofbothservicetax
andVATonsoftwarelicences
Givengovernment'saimtoreduce
hurdles,thiscouldbeimplemented
Nochange
Lowertaxburdenandeliminationof
operationalhurdlesforITcompanies
Clarityondefinitionofexportturnover
Restorationoftaxbenefitsoratleast
clarityinSEZrevenueclassification
clarity
in SEZ revenue classification
willensureahasslefreebusiness
environment
Nochange
Willsmoothentheexecutionandhave
aapositiveimpactofmargin
positive impact of margin
27
Media
Sector
Media
Abatementforpaymentofservicetaxand
entertainmenttax
WheneverGSTisimplemented,service
taxandentertainmenttaxshouldbe
subsumedunderGST.Any
announcementregardingthe
timelinesofimplementationofGST
willbeawelcomestep
GSTisexpectedtobeimplementedin IfGSTisimplemented,thiswillbea
April2016.
hugepositiveforDTHand
multiplexes.
Reductionof10%customsdutyondigital
headendsandsettopboxes
Thisisunlikelygiventheemphasisof
thegovernmentondomestic
procurementofsettopboxes
Nochangeincustomsdutyondigital NA
headendsandsettopboxes.
BlackLightUnitModuleforuseinthe
manufactureofLCD/LEDTVpanels
from10%toNil.OrganicLED(OLED)
TVpanelsfrom10%toNil.
IndirectlypositiveforDTHcompanies
andMSOs,especiallyinPhase3and
Phase4areasasTVpricesisexpected
tocomedownduetolowerraw
material cost
materialcost.
LaunchedtheDigitalIndiaprogramme Slightlypositiveforbroadband
operationsofMSOslikeHathway,
tomakeIndiaaknowledge&
DENNetworksandSITICable.
innovationbasedsocietywith
Broadbandconnectivitybeingtaken
to all villages
toallvillages
TheeffectiveincreaseinServiceTax
ratewillbefromexistingrateof
12.36%(inclusiveofcesses)to14%.
28
Servicetaxincreasedfrom12.36%to
14%isnegativeforcompanieslike
PVR,DishTV.PVRcannotsetoffthe
servicetaxonrentalagainst
entertainment tax
entertainmenttax.
Metals&Mining
Sector
Metalsand SteelSectorincreaseinimportdutyto10%
Mining
fromcurrent7.5%and5.0%forflatproducts
andlongproducts,respectively
Highprobability
Inlinewithourexpectation,the
importdutyonalltypesofsteelhave
beenincreasedto10%.
SteelSectorEliminationofsteelimports
fromfreetradeagreements(FTA)
Possible
Nochange
SteelSectorReductioninimportdutyon
iironorefrom2.5%to'nil'
f
2 5% t ' il'
Lowprobability
Nochange
SteelSectorReductionincustomsdutyon
cokingcoal
Lowprobability
Nochange
Ironoreminersreductioninexportduty
((currently30%)
y
)
Highprobability
Nochange
29
Inlightoftherisingimports,themove
isasentimentalpositiveforthe
sector.However,domesticsteelprices
y
p
y
areunlikelytoimproveastheyare
alreadyatapremiumtoimported
steel.Asaresultofthehikeinimport
duty,thepremiumsonflatswill
reducefromINR4.6/ttoINR3.9/twhile
onlongs,thepremiumswillreduce
fromINR3.5/ttoINR2.1/t.
Cleanenergycessoncoalincreased
fromINR100/ttoINR200/t
NoimpactonCoalIndiasinceitisa
passthrough.Marginalincreaseof
<1%incostforcaptivecoalminers
e.g.JSPL,TataSteelandcaptivepower
p
producerslikeHindalco,NALCO,Sesa
,
,
Sterlite
Increaseinbasiccustomsdutyon
metallurgicalcokefrom2.5%to5%
Nomajorimpactsincemetallurgical
cokeimportsarenotsignificantfor
ourcoveragecompanies
Oil&Gas
Sector
Oil&Gas
Hikeincrudeoilimportdutyfrom0%to5%
Reasonableprobabilityofthisbeing
implementedgiventhesharpfallin
globalcrudeoilpricesandpressure
onthegovernmenttoaugmentits
income
Nohikeinoilcustomduty
Crudeoilproducers:CairnIndia,
ONGCandOIL,couldhavebeen
beneficiariesgivenimportparity
pricing.Removestheoverhangfrom
refiners(expectedfallinGRM,if
customdutyoncrudehadbeen
levied).
HikeinLPGpricesbyINR50/cylinderand
INR23/litrehikeinkeroseneprices
/
p
Aroadmaptofurthersubsidy
reductionmaybelikely
y
y
NopricehikesonLPGandKerosene
CouldhavebeenpositiveforHPCL,
BPCL,IOCL,ONGC,OILIndia
,
,
,
Excisedutychanges
Changesareunlikelyasthe
governmenthashikedpetroland
dieseldutiessharplyaheadofthe
budgetalready
Totalincidenceofexcisedutieson
NoimpactonHPCL,BPCL,IOCL,ONGC,
petrolanddieselremainsunchanged. OILIndia
Rejigintheoverallexciseduty
structure:Roadcessonpetrol&
diesel increased by INR4/litre while
dieselincreasedbyINR4/litrewhile
basicexcisedutycutbythesimilar
amount.Educationcesswhichwas
leviedseparatelyhasnowsubsumed
andisnowincludedinthebasic
exciseduty.Overallmaintainthe
sametaxdutyasearlier.
Governmenttoprovidereasonablesubsidy
provisionforFY16
FY16subsidyprovisionof~INR125bn
andFY15allocationof~INR550bn.
Weexpectoverallgrossunder
recoveryof~INR280bnforFY16.
y
OilsubsidyprovisionforFY16at
INR300bnwhichismuchhigherthan
ourestimateofRs124bn.INR603bn
forFY15isreasonable.
30
PositiveforONGC,OILasgovernment
budgetedprovisionforFY16came
higherthanexpectationsand
providessufficientbufferforoil
p
subsidies.Upstreamsubsidyburden
couldberationalized/relaxed.
Pharmaceuticals
Sector
Pharma
Rollingoutofuniversalaccessprogramme
toessentialmedicines
Donotexpectanysignificantchange
inpolicy
Additionalbudgetedamountto
improveHealthcare.
IncreaseweighteddeductiononR&Dto
300%fromcurrent200%
Nochange
RevisittheMATcurrentlybeingleviedon
SEZs,givenindustryhasveryhigh
investment with SEZs
investmentwithSEZs
Nochange
RemoveexcisedutydisparitybetweenAPI
andformulations
Noannouncement
Overthelongterm,focuswillbeon
increasinghealthcareexpenditureas
%ofGDP;overallpositiveandwill
boostgrowth
Section32AD:Additionalincentives Postivefortheindustry
forinvestmentsinStatesofAndhra
PradeshandTelenganabetweenFY16
d h d l
b
Y16
20.(15%ofcostofnewasset
acquired/installedbyanassessee)
Section32(1)(iia):20%additional
Postivefortheindustry
depreciationallowedoverandabove
Section32(1)(ii)toIncentivise
investmentinnewplant/machinery.
InthestatesofHyderabadand
Telengana,35%allowanceversus20%
inrestofIndia.ValidFY1620.
31
Pharmaceuticals(Contd)
Sector
Healthcare IncreaseofexemptionlimitunderSection
(hospitals) 80Dforhealthinsurance
Donotexpectanysignificantchange
inpolicy
Prioritysectorstatustohealthcare
includinghospitalsanddiagnostics
Increasesacrosstheboard:
INR25,000fromINR15,000earlier
INR30,000fromINR20,000earlier
(SeniorCitizens)
DeductionofINR30,000forVery
SeniorCitizen(>80years)whennot
coveredbyinsurancefortreatment
expenditure
DeductionofINR80,000fromINR
60,000earlier(VerySeniorCitizens
towardsexpenditureonaccountof
specifieddiseases)
Section80DDand80U:limitof
deductionincreasedtoINR75,000
from INR 50 000 (INR 125k from INR
fromINR50,000(INR125kfromINR
100kearlierincaseofsevere
disability)
Postiveforsectorandwillleadto
increaseinpatientvolumesinthe
organisedsector
Noannouncement
BasicCustomsDutyandCVDisbeing Positivefortheindustry.
fullyexemptedonartificialheart(left
ventricularassistdevice)
32
Excisedutyonchassisfor
ambulancesisbeingreducedfrom
24%to12.5%subjecttoactualuser
condition.
Positivefortheindustry.
AmendsonCapitalgainsfavorable
forREITSstructureformationfor
Hospitals.
Positiveatthemargin.However,the
stampdutytobepaidwhile
transferringtheassetsmakesthe
REITStaxstructureinefficient.Hence,
noimpact.
RealEstate
Sector
RealEstate TaxbreaksforREITsabolishMATon
CapitalGainsTaxontransferofassetto
REIT
Likely
Exemptionoflongtermcapitalgains Significantpositive.Willeliminate
keyroadblocksthatispreventing
forsponsorsexitingatthetimeof
developmentofaREITmarketinIndia.
listingoftheunitsofREITsandon
(
),
(
),
saleofunitsreceivedinlieuofshares DLF(HOLD),BRGD(BUY),PEPL
ofSPV,subjecttopaymentof
(Unrated),PHNX(NotRated)tobekey
SecuritiesTransactionTax(STT).Also, beneficiaries.However,upsideforDLF
therentalincomeofREITsfromtheir canbepotentiallycurtailedduetothe
ownassetswillhavepassthrough
underlitigationbanfromaccessing
facilityaswell.
capitalmarkets.
Restorationoftaxincentivestoaffordable
housingundersection80IB
Likely
Nochange
Raiselimitofdeductionofinterestpaidon
homeloanfromINR200,000toINR300,000
Unlikely
Nochange
Relaxlimitsfordeductionsofprincipal
repaymentonhomeloanincreaselimit
undersection80Corprovideseparate
exemptioncomparedtocurrentclubbing
withvarioustaxexemptionsundersection
80C
Unlikely
Nochange
ReduceMATonSEZsfrom20%to10%
Likely
Nochange
33
Retail
Sector
Retail
Easingimportdutyongold
Weexpectimportdutyongoldtobe
rationalisedfromcurrent10%
Improvementinthesupplyofgold
Noreductionintheimportdutyof
gold
Statusquomaintained.Reductionin
theimportdutywouldhavereduced
smugglingofgoldastheygetgoldata
p
pricelowerthanwhatispaidbythe
p
y
organisedretailers
Introductionofthegoldmonetisaiton Positiveforjewellersasitwill
schemeandimpetusonproducing
improvethesupplysituation.Will
goldcoininIndia
encouragerecyclegoldby
g gg
encouraginggoldcoins.
Excisedutyreduction
Rationalisationoftheservicetax
34
RequirementofPANforpurchaseof
goodsaboveINR0.1mnbycash
Negativeforthejewellersespecially
inthoseareaswheretheconsumer
doesnthaveaPANcard.
Implementationwillremaina
challenge.
Reductionintheexcisedutyonthe
leatherfootwearto6%
Positiveforthefootwearcompanies
likeBataIndia,RelaxoFootwearetc.
Howevertheabatementasa
percentageofRetailSalePriceis
beingreducedfrom35%to25%forall
footwear.
Increaseintheservicetaxfrom
12.36%to14%
Servicetaxincreasedfrom12.36%to
14%isnegativeforretailcompanies
likeShoppersStop,FutureRetail,
j
y
Jubilantfoodworksandjewellery
companieslikeTitan,PCJewelleretc
astheyhavetobeartheadditional
serivetaxlevy.
Retail(Contd)
Sector
Anupwardrevisionintheincometax
exemptionlimit
Weexpectanincreaseasitwillbea
stepforwardtowardsdirecttaxcode
Norevisionoftheexemptionlimits
Moretaxexemptionswouldhaveled
tomarginallyincreasingdisposable
incomesoftheurbanpoor/urban
middleclasswhichwillboost
consumerspendingtosomeextent
GSTdeadlinetobeannounced
WeexpectGSTdeadlinetobeset,
thoughimplementationiskey
Expectedtobeimplementedfrom
April2016
GSTwillhelpsimplifytaxstructure,
reducesignificanceofunorganised
players,makinginventoryplanning
morerobustandreduceblack
marketing
35
Telecom
Sector
Telecom
Rationalizationofmultipleleviestoputa
simpleindustryfriendlytaxstructure.
Nochange
36
Servicetaxhikedto14%from12%
(12.36%includingcess)
(12
36% including cess)
Higherservicetaxwillleadtolower
talk time and higher bills for the
talktime,andhigherbillsforthe
subscribers.
AgriandFertilisers
Sector
Fertilisers Increasingureapricesorintroductionof
nutrientbasedsubsidyschemeforurea
A i lt
Agriculture
Higherruralinitiativestosupportfarm
Hi
h
l i iti ti
t
t f
income
Higherspendingonirrigationprojects
Lowprobability
None
Ifapproved,itisapositiveforthe
sectorbecausethegovernment
subsidywilldecline.Direct
beneficiaries would be urea players
beneficiarieswouldbeureaplayers
likeRCF,Chambal,etc.
Reductionincustomdutyon
sulphuricacidforuseinthe
manufactureoffertilizers
Positivefornonureaplayerslike
CoromandelInternational,Zuari
Agrochemicalsetc.
Weexpectthistocontinue,though
W
t thi t
ti
th
h
growthcouldmoderate
Moderateincreaseinallocationin
M
d t i
i ll
ti i
acrosstheschemes
Likely
ReducedallocationfromINR5600crto PositiveforJainIrrigation
INR5300crunderPradhanMantri
KrishiSinchaiYojana.However,
allocationformicroirrigationhas
increasedfromINR30crtoINR1800cr
underthisscheme.
37
Others
Sector
Credit
Rating
Chemical
Importdutyreductiononchemicalfeedstock
andplasticmaterials
Reductionofimportdutyformethanol
feedstock
BasicCustomdutyreductioninon Announcementfordutystructure
ethylenedichloride(2.5%to2%),vinyl reductioncampaignarebelow
chloridemonomer(2.5%to2%),
expectations.However,thereduction
y
(
),
y
p
styrenemonomer(2.5%to2%),butyl
isapositiveforPVCresin
acrylate(7.5%to5%),anthraquinone manufacturerslikeFinolexIndustries.
(7.5%to2.5%).
AlsopositiveforSupremePetrochem
SADonnaphtha,ethylenedichloride, andApcotexIndustriesastheybuy
vinylchloridemonomerandstyrene Styrenemonomer.
monomerformanufactureof
excisablegoodsisbeingreducedfrom
4%to2%
Aviation
Infrastructurestatustoaviationindustry
Statuscouldbeprovidedwithrider
forborrowings
Noinfrastructurestatusakey
Nomeaningfulchange.
negative.Reductioninallocationto
AirIndia(thoughpartlyduetolower
fuelprices)willreducemarket
competition
Tourism
Increasebudgetallocationsforcircuit
development,improvewaterwaysand
reduceluxurytax
Budgetallocationsfortourismsector
especiallycircuitdevlopmentcould
increase
Noannouncementofcircuit
development;onlylistofcultural
heritagesitestobeimproved.No
majorjumpinallocations
38
Bondissuancesundersectorslike
road,railwaysandirrigationshall
furtherdeepencorporatebond
markets:positiveforcreditrating
agencies
Positiveinlongterm.Neutralinshort
term.ThomasCook,Cox&Kingsand
IndianHotelstobenifitfromforeign
touristarrivalgrowth.
Indianhotelswillalsobenefitfrom
lowerincreaseincompetitionwith
maintenanceofinfrastructurelending
eligibilityatINR2bn
Others(Contd)
Sector
Textile
Reductioninexcisedutyonmanmadefibre
(MMF)andfilamentsto6%from12%
Unlikelygiventhecurrentcottonstock
andpricesituation.
Textile
Excisedutykeptconstant
NegativefortheMMFsector.However,
itdoesnotputanyadditional
pressureonalreadylowcotton
prices.
AllocatedINR15bntoTechnology
Donotseenegativeimpactasthe
UpgradationFundScheme(TUFS),18% industryitselfhasbeenspendingless
decreaseoverrevisedFY15estimates oncapexforspinning.FY15TUF
ofINR18.6bn
schemewasunderutilised.
Logistics
Clear roadmap for GST implementation

ClearroadmapforGSTimplementation
Exceptthegovernmenttosticktothe
Except
the government to stick to the
proposedrolloutdateofApril01,
2016
Governmenthasreaffirmedits
Government
has reaffirmed its
intentiontorolloutGSTbyApril01,
2016.
Positive: Implementation of GST will

Positive:ImplementationofGSTwill
beagamechangerforthesector
Logistics
Industrystatusandaseparateregulatorfor
thesector
Alongstandingdemandwhichhas
notbeenaddressedtillnow
Noannouncementrelatedtothis
Negative
L i i
Logistics
FreshallocationofINR2bnmadefor
h ll
i
f I 2b
d f
assistancetomajorandnonmajor
portsundertheSagarmalaProject.
Postive
i
Logistics
Postive
GrantofINR2.3bntoInlandWater
TransportAuthorityofIndia,a132%
i
increaseoverrevisedFY15estimates
i d Y1
i
ofINR1bn.
Peanut
Butter
Implementedexcisedutyof2%
withoutCENVATcreditor6%with
CENVATcreditisbeingleviedon
peanutbutterversusearliernil
t b tt
li
il
NegativeforAgrotechFoods
Plastic
Cutincustomdutyinstyrene
monomerfrom2.5%to2%andSAD
from4%to2%
PositiveforSupremeIndustries
39
Annexures
40
Fiscaldeficit(INRbn)
Particulars(INRbn)
FY16(BE)
TOTALREVENUES
12,218
Taxrevenue(net)
9,198
GrossTaxrevenue
14,495
Incometax
3,274
C
Corporatetax
t t
4 706
4,706
Customstax
2,083
Exciseduties
2,298
Servicetax
2,098
5,240
NonTax
Non
TaxRevenue
Revenue
3 020
3,020
Dividends
1,007
Telecomand3G
429
Disinvestment
695
TOTALEXPENDITURE
17,775
Revenue
15,360
Interestpayments
4,561
Defence
1,521
Subsidies
2,438
Foodsubsidy
1,244
Fertilisersubsidy
300
Petroleumsubsidy
730
Policeandpensions
1,403
889
149
Developmentrelated
3,929
Others
469
Capital
2,414
Defence
946
Developmentrelated
1,458
FISCALDEFICIT
5,556
141,089
,
NOMINALGDP
RE:RevisedEstimates,BE:BudgetEstimates
FY15(RE)
11,685
9,085
12,514
2,786
4 261
4,261
1,887
1,855
1,681
3,378
2 601
2,601
888
432
314
16,812
14,888
4,114
1,404
2,667
1,227
603
710
1,298
647
108
4,244
407
1,924
820
1,094
5,126
126,609
,
41
FY14
10,566
8,159
11,387
2,429
3 947
3,947
1,721
1,702
1,548
3,182
2 407
2,407
904
401
294
15,594
13,718
3,743
1,244
2,546
920
854
673
1,170
553
19
4,066
377
1,877
791
1,080
5,029
113,551
,
FY13
9,198
7,403
10,362
2,015
3 563
3,563
1,653
1,765
1,326
2,960
1 795
1,795
538
189
259
14,104
12,435
3,132
1,113
2,571
850
969
656
1,068
453
0
3,753
346
1,669
705
921
4,906
101,133
,
FY12
7,884
6,298
8,892
1,645
3 228
3,228
1,493
1,449
975
2,594
1 586
1,586
506
174
181
13,044
11,458
2,732
1,030
2,179
728
685
700
943
440
42
3,783
310
1,586
679
901
5,160
90,097
,
Fiscaldeficit(%,YoY)
Particulars(%,YoY)
TOTALREVENUES
Taxrevenue(net)
GrossTaxrevenue
Incometax
Corporatetax
Customstax
Exciseduties
Servicetax
NonTaxRevenue
Dividends
Telecomand3G
Disinvestment
TOTALEXPENDITURE
Revenue
Interestpayments
Defence
Subsidies
Policeandpensions
(
)
Developmentrelated
Others
Capital
Defence
Developmentrelated
FISCALDEFICIT
NOMINALGDP
BE:BudgetEstimates
FY16(BE)
4.6
1.3
15.8
17.5
10.5
10.4
23.9
24.8
55.1
16.1
13.4
(0.7)
121.7
5.7
32
3.2
10.9
8.4
(8.6)
8.1
37.4
38.8
(7.4)
15.4
25.5
15.4
33.3
8.4
11.4
FY15(RE)
10.6
11.4
9.9
14.7
8.0
9.7
9.0
8.6
6.2
8.0
(1.8)
7.6
6.7
7.8
85
8.5
9.9
12.9
4.7
11.0
17.0
454.4
4.4
7.9
2.5
3.6
1.3
1.9
11.5
42
FY14
14.9
10.2
9.9
20.5
10.8
4.1
(3.6)
16.7
7.5
34.1
68.2
112.2
13.4
10.6
10 3
10.3
19.5
11.8
(1.0)
9.6
22.2
FY13
16.7
17.5
16.5
22.5
10.4
10.7
21.8
36.0
14.1
13.2
6.2
8.6
43.1
8.1
85
8.5
14.7
8.0
18.0
13.3
2.9
FY12
(4.3)
10.5
12.1
18.3
8.1
10.0
5.2
37.3
16.2
(37.5)
5.5
(85.6)
(20.8)
8.9
10 1
10.1
16.7
11.9
25.7
11.2
39.5
8.3
8.8
12.5
12.2
17.3
2.5
12.3
(0.8)
11.9
5.2
3.8
2.2
(4.9)
12.2
(0.9)
5.3
1.3
9.4
1.9
38.1
15.7
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