Share market welcomes budget, sensex rises 500 points
Lucknow: The Bombay Stock Exchange (BSE) sensex which went up by over 200 point after the presentation of the budget by finance minister Arun Jaitley in the Lok Sabha on Wednesday marked a 500- point rise at the end of the day. This indicated that, by and large , businessmen and industrialists have liked the budget.
Bank shares especially of the State Bank of India rose by two per cent largely on account of the government's proposal to provide Rs 10,000 crores to them for their recapitalisation. Availability of more money with the banks will improve their economic health and may benefit the account holders.
In addition to financial assistance to public sector banks, people in general have appreciated the government's desire to bring down percentage of deficit financing to little over three . Jaitley had favoured reducing it below four per cent and has succeeded. Therefore, further deduction proposal was desirable.
The budget has also provided relief to the salaried class in the lower income group. Those earning less than Rs five lakhs annually will have to shed only fifty per cent of tax they have been paying so far. The revenue loss will be compensated by levying additional tax on high-income bracket employees.
Jaitley has answered the people who had spread the rumour that the government would gradually cut down allotment to the rural employment scheme, NREGA. He has allocated additional Rs 48,000 crores for the scheme which has acquired popularity in the rural areas.
The Modi government which wants to encourage digital mode of payment for the sake of transparency has proposed to put a cap on non-digital payments. Payments above Rs three lakhs can be made in the next financial year only digitally.
A major reform has been proposed in the Representation of Peoples Act. Political parties used to receive donations up to Rs 20,000 without disclosing the source. In the last ten years they received average 70 per cent donations from unknown sources. Some of them used the provision to convert black money into white.
The Election Commission urged the government several times to either end the practice or reduce the amount. In view of the present government's inclination towards reforms in different fields in its latest letter to the Modi government the electoral body had urged it to bring the amount down to Rs 2000. It has been accepted by the government and the proposal is a part of the new budget.