Mr. Somnath Patil, President & CFO, Deepak Fertilisers and Petrochemicals Corporation Limited.

02 Mar 2015 CW Team

Higher allocation for Infrastructure spend by Rs.70000 cr and setting up National Investment & Infrastructure Fund with Govt contribution of Rs.20000 crs & introduction of Tax free Infra Bonds are all a big positive for boosting infrastructure growth
Focus on road construction and electrification proposals including setting up and of 5 UMPPS of 4000MW each, augur very well for the mining and infrastructure segments of the economy which are our end use industries.
Steps such as deferment of GAAR to April, ’17, changes to permanent establishment rules for FIIs etc would boost overseas investment which is so badly required for infrastructure funding.
Reduction of corp tax to 25% over next 4 years, exemptions to be removed. Not clear how much in FY’16, but positive. Cenvat increased to 12.50% and Service tax to 14% (from 12.36%) are negatives.
On the indirect tax front, the government has taken the right steps with the announcement of a definite timeline for the introduction of Goods and Services Tax (GST) with effect from April 2016 and also rationalization of customs duty structure which will further boost the industry.
Focus on soil health – per drop more crop, coupled with subsidy rationalization, the details of which need further clarity, micro irrigation etc imply encouragement to NPKs but no clarity on inclusion of priority resource allocation. Rural infrastructure spend of Rs.25000cr and rural finance programs will also benefit Agriculture.
Huge boost to housing & realty…6 cr houses. Wealth tax abolished but super rich (income over Rs.1 cr) to pay 2% surcharge on income tax.

It is a pro-growth budget and a very crucial one. This budget will set the direction for boosting overall economic growth and development in a sustained manner over a longer period of time. The budget has set directions to facilitate ease of doing business in India in order to attract investments, both domestic and foreign. Concerted, focused and conducive policies are seen in the infrastructure development which will boost the overall business dynamics of the economy. Higher allocation for Infrastructure spend by Rs.70000 cr and setting up National Investment & Infrastructure Fund with Govt contribution of Rs.20000 crs & introduction of Tax free Infra Bonds are all a big positive for boosting infrastructure growth Focus on road construction and electrification proposals including setting up and of 5 UMPPS of 4000MW each, augur very well for the mining and infrastructure segments of the economy which are our end use industries. Steps such as deferment of GAAR to April, ’17, changes to permanent establishment rules for FIIs etc would boost overseas investment which is so badly required for infrastructure funding. Reduction of corp tax to 25% over next 4 years, exemptions to be removed. Not clear how much in FY’16, but positive. Cenvat increased to 12.50% and Service tax to 14% (from 12.36%) are negatives. On the indirect tax front, the government has taken the right steps with the announcement of a definite timeline for the introduction of Goods and Services Tax (GST) with effect from April 2016 and also rationalization of customs duty structure which will further boost the industry. Focus on soil health – per drop more crop, coupled with subsidy rationalization, the details of which need further clarity, micro irrigation etc imply encouragement to NPKs but no clarity on inclusion of priority resource allocation. Rural infrastructure spend of Rs.25000cr and rural finance programs will also benefit Agriculture. Huge boost to housing & realty…6 cr houses. Wealth tax abolished but super rich (income over Rs.1 cr) to pay 2% surcharge on income tax.