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from India Insight:
Taxing times for reporters on the Chidambaram beat
(Any opinions expressed here are those of the author and not necessarily of Thomson Reuters)
Finance Minister P. Chidambaram’s drive to shore up government coffers is not just giving businessmen sleepless nights.
Just when reporters were taking a breather after filing stories based on inflation data on Thursday, the finance ministry sent them text messages about a press briefing. The recipients were supposed to rush to Chidambaram’s office in 15 minutes to cover what appeared to be a major policy announcement. After all, the finance minister doesn’t call on such short notice for chitchat.
As they raced through Delhi traffic and crossed the security cordon, many journalists were already thinking of the headlines they would write after the press briefing. With barely two weeks to go before the financial year ends, Chidambaram is racing to meet fiscal targets that will affect the country's deficit, debt rating and more. Any slip would dent his credibility – and he is determined to collect every penny.
from Expert Zone:
Budget 2013: A rather ambitious budget
(Rajan Ghotgalkar is Managing Director of Principal Pnb Asset Management Company. The views expressed in this column are his own and do not represent those of either Principal Pnb or Reuters)
Rating agencies have left India’s sovereign rating unchanged after the 2013 Budget. A rating downgrade would mean India getting junk status which is certainly not something one would want when the current account deficit is widening.
from Expert Zone:
Budget 2013: A run-of-the-mill affair
(Any opinions expressed here are those of the author and not of Reuters)
After the sustained hype of a game changer budget, Budget 2013 was a totally run-of-the-mill affair with no announcements of any kind of deregulatory or growth propelling initiatives.
True enough, some of the more promising measures taken in the last 12 months were not related to budgetary statements. Not surprisingly, the Sensex greeted Budget 2013 by falling.
from Expert Zone:
Budget 2013: Chidambaram’s chance to bell the cat
(Any opinions expressed here are those of the author and not of Reuters)
This year’s budget will be an interesting one and it will hopefully be more pragmatic than populist.
Not much has changed since Pranab Mukherjee presented the budget in 2012. At the time, India was battling high inflation at 9 percent, fiscal deficit at 5.9 percent of GDP and a current account deficit (CAD) at 4.2 percent of GDP.
from Expert Zone:
Budget 2013: High on expectations again
(Any opinions expressed here are those of the author, and not those of Reuters)
It’s budget time in India once again, the annual month of anxiety and expectations that everyone awaits with bated breath.
Budget 2013 will be especially important on two counts. Coming as it does ahead of crucial state elections, the Feb. 28 budget could be outrageously populist. But with the government not really following through on its policy reforms in recent months, the question is how intent can translate to concrete action. Tough decisions are needed with a greater focus on growth.
from India Insight:
A look at India’s last five annual budgets
The countdown has begun for the biggest business and economic event of the year, the release of India's annual budget at the end of February, and Finance Minister P. Chidambaram has a tough job on his hands. With general elections a year away, he must please voters, boost growth and control deficits.
In the last five years, the finance minister has always relaxed income tax slabs -- by either increasing the basic exemption limit or widening the tax slabs. As far as markets go, the 2009 budget day was the worst for stocks as the index fell around 950 points during trade. However, the focus has always been on the government's fiscal deficit targets, which have hovered around the 5 percent mark in recent years.
from Global Investing:
Indian markets and the promise of reform
What a difference a few months have made for Indian markets.
The rupee is 8 percent up from last summer's record lows. Foreigners have ploughed $17 billion into Indian stocks and bonds since Sept 2012 and foreign ownership of Indian shares is at a record high 22.7 percent, Morgan Stanley reckons. And all it has taken to change the mood has been the announcement of a few reforms (allowing foreign direct investment into retail, some fuel and rail price hikes and raising FDI limits in some sectors). A controversial double taxation law has been pushed back. The government has sold some stakes in state-run companies (it offloaded 10 percent of Oil India last week, netting $585 million). If the measures continue, the central bank may cut interest rates further.
Above all, there have been promises-a-plenty on fiscal consolidation.
The promises are not new. Only this time, investors appear to believe Finance Minister P. Chidambaram.
from Expert Zone:
Budget 2013 should trim expenditure
(Any opinions expressed here are those of the author, and not necessarily of Reuters)
Finance Minister P. Chidambaram is only too aware of the damage done by the last budget and has to an extent repaired it to unleash investment. The next budget should confirm his commitment to growth.
from Breakingviews:
Liberal economists aid Tea Party in cliff debate
By Edward Hadas
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
If everyone agreed that outsized fiscal deficits present a clear and present danger, the American politicians who object to tax increases would be in serious trouble. But the anti-tax zealots are given intellectual cover by their ideological enemies, the deficit-loving liberals.
from India Insight:
Market-friendly Chidambaram toes socialist line with fiscal plan
The usually crisp and precise P. Chidambaram was uncharacteristically vague on Monday while announcing the government’s fiscal consolidation plan. While pledging to bring the fiscal deficit down to 3 percent in 2016-17 from around 5.3 this fiscal, the Harvard-educated minister gave no details on how the government would achieve this feat.
Perhaps the finance minister should remember that uncertainty and lack of clarity can spook markets and investors. We saw that when the government took months to clarify the controversial GAAR norms which made foreign investors jittery.
