Union Budget 2023-24 Live: Income Tax Rebate limit increased to Rs 7 lakh from Rs 5 lakh

Agri and EV gains

“Currently, India’s NPK ratio is 7.3:3:1 versus the widely accepted 4:2:1. The PM PRANAM scheme, which aims to reduce usage of chemical fertilisers, can help India move towards more balanced fertiliser applications. It can also help reduce imports, which stand at ~30% today. Continuing the current lower customs duty on lithium ion cells for next fiscal will help keep the cost of battery cells under check. Customs Duty exemption on capital equipment for manufacturing battery cells will encourage investments to manufacture battery cells” – CRISIL

Income Tax

In new tax salaried income will pay Rs 15.5 lakh or more will stand benefit by Rs 52,500

Watch: FM Nirmala Sitharaman speaks on Artificial Intelligence

Fillip for digital payments

“The achievement of Rs 126 lakh crores of digital payments through UPI in 2022 from Rs 7400 crores is a big milestone for India. Initiatives including extension of Bharat Bill Payments System for NRIs, approval of Rs 2,600 crores incentive scheme for FY24 for RuPay debit card and UPI transactions, and growing digital payment acceptance with digital infrastructure have given a big boost to digital payments via UPI in India as well as global level. Additionally, the government is aiming to set up 100 labs for developing 5G apps. 5G technology in financial sector will ensure faster and efficient digital transactions.” Rajri Rengan, Head of Banking and Payments, India and Phillipines, FIS

Watch: Revamped credit guarantee scheme for MSMEs with infusion of Rs. 9,000 cr to be launched from April 1: FM

Sugar companies

Sugar companies to get relief of Rs 10,000 crore. Positive for sugar company stocks such as Shree Renuka Sugars, Dwarikesh Sugar, EID Parry, Balrampur Chini and Dhampur Sugar

Personal Income Tax

Five major proposals

Live: Mobile phone manufacturing

Govt proposes to reduce customs duty on import of certain inputs for mobile phone manufacturing

Start-ups

Extend the date of incorporation for ai come a tax by a year. Benefit of carry forward of losses in charge of ownership extended to 10

Years from sevention

Viability gap funding for battery storage capacity

Viability gap funding for battery storage capacity of 4000 mwh can engender capex of about Rs 15,000 crore. This should lead to lower tariffs for storage-linked project bids from around Rs 7-9 per unit now. – CRISIL

Customs duties on open cells cut

• Reduction on customs duty on open cells used in production of televisions to 2.5%. This is likely to drive the demand for televisions. This is likely to benefit contract manufacturers like Dixon Technologies

Lower BCD on Acids

“Government has reduced custom duty on basic Acid Base Fluorspar from 5% to 2.5% . Beneficial for fluorine chemistry players like SRF, Navin as fluorspar is raw material for many fluorine products” – ICICI Direct

Excise duty component NCCD on cigarettes increased by 16%. Negative for ITC & VST Industries – ICICI Securities

Naming millets as ‘Shri Anna’, FM announces firm steps for farm sector

Digital public infrastructure for agriculture will be built as an open source, open standard on mission mode, and an interoperable public good, Finance Minister Nirmala Sitharaman announced presenting the Budget for 2023-24. She said it will help in crop planning and facilitate easy access to inputs and credit for farmers apart from supporting agritech industry and start-ups in crop estimation and market intelligence activities.

Cut in customs duties

Government has reduced custom duty on basic Acid Base Fluorspar from 5% to 2.5% . Beneficial for fluorine chemistry players like SRF, Navin as fluorspar is raw material for many fluorine products: ISec

TV Panels

To reduce customs duty on open cells of TV panels to 2.5%

Lower latex cost

“Cutting duty on latex. This can help reduce the prices of condoms”: Market experts

Sugar Cooperatives

Sugar cooperative to claim payments to sugarcane farmers before AY 2017 as tax benefit, Benefits to be at Rs 10,000 crore

Lab-grown diamonds: IIT to gain

“The grant provided to IIT for lab-grown diamonds is a positive. The segment has seen a steep 54% growth in exports on-year, and accounted for 5% of total diamond exports YTD23” – CRISIL

Focus on tourism development will boost air travel – ICRA

Interest-free loans to states

50-year interest free loans for states for capex spend within 2023-24 to augur well for scrapping/replacement of buses- ICRA

Silver bars import duty

Propose to increase import duty on silver bars to align it with gold, platinum

More air time

Relief in customs duty on mobile phone parts will help PLI scheme participants. Positive for Samsung and Lava

The reduction in fiscal deficit to 5.9% of GDP in FY24 will complement central bank’s monetary policy action to ease inflation. This will be taken positively by bond markets – CRISIL

Flying high

“UDAAN scheme gets a fillip by the focus on development of 50 new airports and aerodromes. With this we can expect to have air connectivity for every 4 districts. Commercial viability assessment will be critical for its success” – Jagannarayan Padmanabhan, Director, CRISIL Limited

Better sowing

“Setting up of a Center of Excellence for Millets, which have high nutritional content, will help increase the share of gross sown area under millets, which today stands at a mere 3% of total gross cropped area” – CRISIL

Credit guarantee scheme for MSMEs

The revamped Credit guarantee scheme for MSME, which will effective from April 1, 2023, will be positive for mid-sized banks and NBFCs focussed on MSME loans, according to ICICI Securities. The scheme will get an infusion of Rs 9000 crore. This will enable extension of additional collateral-free credit amounting about Rs 2 lakh crore

Copper Scrap

Concessional BCD on copper scrap to continue to benefit secondary copper manufacturers including MSMEs

Increased allocation to the PMAY

“With allocation to the Pradhan Mantri Awaas Yojana rising 66% to Rs 79,000 crore next fiscal, more than 55% of the estimated gap in funding for projects under the scheme is addressed. This should help timely construction of urban and rural houses” – CRISIL

Infrastructure Finance Secretariat

Newly established Infrastructure Finance Secretariat will assist all stakeholders for more private investment in infrastructure, harmonized master list of infra to be reviewed by an expert committee for recommending classification & financing fwk.

Capex outlay

Capex outlay increased by 33% to Rs 10 lakh crore for FY24. At this level, public capex will be 3.3% of GDP. Equity indices are in the green so far. But bond markets are getting jittery as expenditure looks elevated so far. 10-year bond yield has climbed 2 basis points to 7.38% since the FM announced the hike in capex outlay. A lower fiscal deficit will cool bond markets. Satish Menon, Executive Director at Geojit Financial Services.

More airports

“50 additional airports, aerodromes, and water ports to improve regional air connectivity. Improvement in regional air connectivity will also supports tourism in tier-II and III cities. Improvement in regional air connectivity through the set up of 50 additional airports will boost domestic air travel” – ICRA

Sensex, Nifty hit day’’s high

Benchmark equity indices Sensex and Nifty hit day’s high as the Finance Minister announced the Financial year 2023 growth estimate at 7%. Sensex rose 528 points or 0.89 percent to touch a high of 60,190. Nifty gained 160 points or 0.81 percent at 17,837. The FM said Indian economy has become more formalised as witnessed by significant enhancement in digital payments. Per capita income has increased to Rs 1.97 lakh. Indian economy has increased in size from being 10th to 5th largest in last nine years.

Electric Kitchen Chimneys

BCD on electric kitchen chimneys duties increased to 15 per cent, BCD on heat coils reduced

Adequate funding to scrap old government vehicles and ambulances will be marginally positive for SCV buses and other vehicle categories – CRISIL

Mobile Phones

Relief of custom duties on import of certain parts of inputs camera lense, continue concessional data on lithium ion batteries

Who gains from scrap

State Governments to be provided funds for scrapping old vehicles. Positive for auto companies such as Maruti Suzuki, Tata Motors, Mahindra & Mahindra and Ashok Leyland

State governments

The 50-year interest-free loan to state governments to be continued for one more year, to spur investment in infra and to incentivize them for complimentary policy actions, with enhanced outlay of Rs. 1.3 lakh crore

Better privacy

“National data governance policy can potentially protect personal privacy and data security, promote data interoperability and accessibility. It will encourage data-driven innovation, improve data quality and reliability, and enhance transparency and accountability. It can establish standards and regulations for data collection, storage, and use, promoting data management practices and the responsible use of data”, Rajagopal Menon, WazirX

Infra capex

The Union Budget 2024 paves the way for yet another year of the government using infrastructure-capex to support the economy. This is enhanced by the govt’s focus on green capex transition support. Capex support from the budget rises to 4.5% of GDP for the next fiscal from sub-4% this fiscal and sub-3% in fiscal 2020 – CRISIL

Fiscal Deficit

Revised estimate of of Fiscal Deficit at 6.4 per cent of GDP, Net Market borrowings estimated at Rs 11.8 lakh crore

Building Unity Malls

“Unity Malls in tourist destinations or capital cities is a novel approach to boost local craft and art. This will boost local employment” – Market experts

De-risking Aadhar and common sharing of biometrics

PAN will be used as common identifier for all digital systems of specified government agencies.