Budget 2017 may be presented in the first week of February and there are huge expectations from FM Arun Jaitley. Nilesh Shah, MD, Kotak AMC on Thursday said that Budget 2017 needs to boost the consumer sentiment by cutting taxes. In an interview with ET Now he also stated that it is expected that market will trade in narrow-tight range till Budget. “I believe markets will swing like a pendulum for next two months.” “It is also needed that Budget should manage fiscal committment. Innovative thinking is needed to raise revenue in Budget.” Talking about demonetsiation he said that, “I don’t think demonetisation will be negative in the long term, however, I believe it will be ‘superbly’ positive in the long term.” He also said that one needs to watch out for Budget, yuan depreciation, GST, UP elections in 2017.
Meanwhile, the Modi government is pitching hard for a cashless economy. Recently, the government decided that no service charge will now be levied for use of debit cards. Department of Economic Affairs Secretary Shaktikanta Das has said that till December 31, 2016, no service charges will be levied on debit cards and that the move is meant to ensure greater penetration of digital transaction. Meanwhile, to encourage digital transactions, the RBI has increased the doubled the limit on the balance that one can keep in e-wallets. The limit has been enhanced from Rs 10,000 to Rs 20,000.
The Narendra Modi government has come under severe criticism from the Opposition for its move to demonetise old Rs 500 and Rs 1000 notes. The reaction on the ground has, however, been mixed. While most people have lauded the move to check black money and corruption, many have said that the implementation, especially when it comes to availability of currency, should have been much better. Struggling to deal with growing anger among the public over cash crunch, the Modi government is issuing new guidelines every few days.