Given the economic and political circumstances, the finance minister has presented a pragmatic vwith good intentions for inclusive and sustainable development. This is one of the most challenging times that the world economy is facing and the scenario is no different in India. The Union Budget for 2013-14 is well-balanced and pro-active with well-defined measures to bring back the economy on higher growth trajectory. Considering it as the last Budget before the county goes to election, the government has presented a Budget which has a little bit for all sections.
Lowering of fiscal deficit is perhaps the most important aspect of the Budget. The finance minister has attempted to keep the deficit in acceptable limit and maintaining focus on growth. We are confident there will be several other measures that the government will announce progressively to ensure the economy is back on track.
Focus on the infrastructure sector is in keeping with India?s insatiable need for enhanced infrastructure. India suffers from severe infrastructure deficit and any steps taken to improve infrastructure are welcome. The announcement regarding the constitution of a regulatory authority for the roads sector is welcome and addresses a long felt need. If the regulator can be constituted quickly and armed with independent powers, it has the potential to address a number of problems plaguing India?s highways development programme. We look forward to the announcement of the 3,000-km of road projects in Gujarat, Madhya Pradesh, Maharashtra, Rajasthan and Uttar Pradesh this year.
The scheme for the financial restructuring of discoms to restore the health of the power sector is a good step and we look forward to state governments preparing the financial restructuring plans quickly. This will go a long way in helping the power sector come out of the gloom. The government?s plans to encourage public-private partnership projects along with the state-owned Coal India is a positive step and we hope it helps accelerate and supplement domestic coal production.
This Budget was expected to create an enabling environment for raising long term debt and equity. The government?s intention of encouraging Infrastructure Debt Funds (IDF) and the move under, which India Infrastructure Finance Corporation (IIFCL) will offer credit enhancement to infrastructure companies is in line with the market expectations.
We expect stronger sustained steps to be taken beyond the Budget, to address core issues faced by the Indian infrastructure and power sector industry in particular. The government should at the earliest look into addressing the issue of land acquisition; more fuel supply for the power sector, time bound project approvals and clearances and financing etc. These issues are constraining growth of the Indian infrastructure and power sector which in turn is impacting the growth of the economy.