no complaints at Dalal street with the Union Budget

• Sensex closes  at 16429, up 175 points and Nifty at 4922, up 62 points from the previous close.
• Metals, auto, banks are the major gainers today.
• Experts believe the market had gone into the Budget with no expectations so the positives (no change in Service Tax, infra spend, personal tax front among others) saw a surge in sentiments and now market is likely to get back to global cues next week.

• FM prunes tax rates:
  Income up to Rs 1.6 lakh – nil Income above Rs 1.6 lakh and up to Rs 5 lakh – 10 per cent
  Income above Rs 5 lakh and up to Rs 8 lakh – 20 per cent
  Income above Rs 8 lakh – 30 per cent.
• Income Tax department ready with two-page Saral-2 return forms for individual salaried assesses.
• New tax rates would offer relief to 60 per cent of tax-payers.
• Government’s net borrowing to be Rs 3,45,010 crore for 2010-11.
• Additional deduction of Rs 20,000 allowed on long term infrastructure bonds for income tax payers; this is above Rs one lakh on saving instruments allowed already.
• A unique identity symbol would be provided to the Indian Rupee in line with US Dollar, British Pound Sterling, Euro and Japanese Yen.
• Fiscal deficit seen at 4.8 per cent and 4.1 per cent in 2011-12 and 2012-13 respectively.
• Total expenditure pegged at Rs 11.8 lakh crore, an increase of 8.6 per cent.
• Gross tax receipts pegged at Rs 7,46,656 crore for 2010-11, non-tax revenues at Rs 1,48,118 crore.
• FM appeals to “misguided elements” (left wing extremists) to eschew violence and join the mainstream.
• Planning Commission to prepare integrated action plan for Naxal-affected areas.
• Defence allocation pegged at Rs 1,47,344 crore in 2010-11 against Rs 1,41,703 crore in the previous year. Of this, capital expenditure would account for Rs 60,000 crore.
• Fiscal deficit pegged at 6.9 per cent in 2009-10 as against 7.8 per cent in the previous fiscal.
• Finance Minister to continue giving cash subsidy for fuel and fertiliser instead of previous practice of bonds.
• Non-plan expenditure pegged at Rs 37,392 crore and Plan expenditure at Rs 7,35,657 crore in budget estimates. 15 per cent increase in plan expenditure and six per cent in non-plan expenditure.
• The government said on Friday it would increase borrowing next year to a new record level, putting pressure on the Reserve Bank of India (RBI) to be more aggressive in its monetary tightening this year.

• The budget focused on keeping the economic recovery robust, but there was little mention of reforms, such as freeing state fuel and food subsidies, that investors say could help India rival China’s years of double-digit growth rates.
• Some market watchers said India had missed a chance to take more aggressive fiscal measures as Asia’s third-largest economy gathers speed, reinforcing perceptions that the coalition government may not have the heart to make tough decisions about liberalising the economy.
• Gross borrowing for the new fiscal year will total 4.57 trillion rupees ($99 billion), slightly below a Reuters poll forecast for 4.61 trillion rupees but above a record 4.51 trillion rupees expected in the current year ending in March, Mukherjee said.
• “With the fiscal deficit expected to be still high over the next fiscal year, it is clear that the onus will be on the RBI to hike rates in coming months in order to move policy settings closer to neutral and to deal with emerging inflation pressures,” said Brian Jackson, strategist at Royal Bank of Canada.

• Some analysts believe the slowdown in spending growth may help ease inflation. High food prices have helped push broader inflation to what some economists expect could hit 10 percent next month.
• Opposition lawmakers boycotted much of the budget session, saying government plans to increase fuel prices would further add to the woes of millions of Indians hit by high prices.
• The 165-billion-rupee ($3.6 billion) recapitalisation plan for state-run banks and extension of farm debt waiver scheme would benefit banking sector, analysts and bankers said, sending sectoral shares up.
• The government expects stake sales in state firms to fetch 400 billion rupees ($8.6 billion) in 2010/11, an estimate analysts believe is achievable if the stock market holds up and government offerings are priced attractively.
• The government will boost farm spending and lift agriculture sector growth to 4 percent in the medium term, Finance Minister Pranab Mukherjee said on Friday, but analysts said the budget failed to introduce measures to curb rising food prices.
• The economy is likely to do better in the quarter to March than the three preceding quarters, Finance Secretary, Ashok Chawla said on Friday.
• Construction companies cheered government moves to increase funds to the sector in the budget, tax breaks to infrastructure bond investments and increased lending to the industry, but the share reaction was mixed.
• Finance Minister Pranab Mukherjee on Friday allocated 1.73 trillion rupees to infrastructure projects and said individual investments of upto 20,000 rupees in bonds floated by such companies will be tax-exempt.
• This budget had mixed reaction from different quarters, but Dalal street no complaints.