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Infrastructure projects in India are now being executed in half the time it took some years ago. Well, that may well be the headline a few years down the line, if the government succeeds in yet another effort to speed up infrastructure projects in the country. The government has set up a big committee of ministers to oversee the process of approval and execution of infrastructure projects.
A revival in industrial production is a healthy sign for the Indian economy, as it had turned negative in the recent past. With a question on agricultural output due to a late monsoon, it falls upon industry and services to contribute to the economy’s growth in 2009-10.
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Continue ReadingInfosys Technologies kicked off the earnings season on a positive note. Its results reflect a tough operating environment but exceeded its guidance and market expectations. The software major’s revenues declined by 2.9% over the preceding quarter to Rs 5,472 crore in the June 2009 quarter. Its net profit would have declined too but a 130% increase in other income kept net profit constant at Rs 1,915 crore. In dollar terms, its revenues declined by 0.1% sequentially and by 1.9% in constant currency terms.
Wockhardt has announced that the corporate debt restructuring cell (CDR) has approved the corporate debt restructuring package on June 30, 2009. The company has accepted the CDR package which involves restructuring of debt, release of working capital and fresh priority debt pending divestment of non-core businesses.
At first, it might seem that Tech Mahindra’s plans did not work out, as its open offer failed, leaving it with a 43% stake instead of a 51%. This setback hardly matters, however, if the two companies merge. A merger could mean that the group could repay the entire debt taken for the acquisition, using Satyam’s shares held by Tech Mahindra, if it so wishes.
Income Tax
This was a big disappointment to those expecting a bagful of goodies from the Indian government, that the Union Budget 2009-10 would cut dividend distribution tax, corporate tax rates will be cut and so on. There was no change in the corporate tax rate.
There was little to cheer for the individual tax payer in the 2009-10 Union Budget. The view perhaps is that the burden on him has been lowered substantially in the past few years. Hence, there is no reason to do a lot this year.
India’s tax-gdp ratio has improved from 9.2% in 2003-04 to 11.5% in 2008-09. The government wishes to simplify the tax structure. A new direct tax code will be released for public comments within 45 days and the new code will be finalised during the winter session of parliament. A Goods and Services Tax to be introduced from April 2010, but will comprise of a Central GST and a State GST.
Direct Taxes
Individual
Continue ReadingThese are some of the highlights from the speech given by the Finance Minister Pranab Mukherjee, presenting the Budget in parliament. Part One deals with the state of the economy and key policy announcements while the second part will deal with tax proposals.
Continue ReadingOverall Impact
The Union Budget 2009-10, as Pranab Mukherjee mentioned, is one of continuity. No major new schemes. No major tax changes. No change in the thinking of the government with respect to the fiscal deficit. No major reforms announced in the Budget, either. The initial impression one gets is that the government is hoping that the external environment will improve, domestic demand will pick up and lift the economy out the trough.