Finance Minister Arun Jaitley on Saturday said the Budget would be designed to help the economy sustain 8-9 percent growth and investments in infrastructure and irrigation might continue.
In an interaction with a television news channel at the Global Business Summit, Jaitley also hoped the Congress would help the government clear the Goods and Services Tax (GST) Bill in the Budget session of Parliament.
He said only a couple of tax disputes with multinational companies were pending and these would be settled soon. Vodafone and Cairn have dragged the government into arbitration over tax claims.
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The final monetary policy review of the fiscal, amidst the third quarter results season and the interest of foreign investors, is expected to direct the Indian equity markets in the upcoming week.
Moreover, the rupee’s trajectory, followed by trends in the global commodity prices and fears of competitive devaluation of currencies, will decide on the positions investors take.
The RBI is expected to conduct its sixth and final bi-monthly monetary policy review on 2 February.
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In the September 2015 review of monetary policy, the Reserve Bank of India (RBI) surprised the market by cutting its policy rate by half a percentage point to 6.75 percent. It had also said that its stance would “continue to be accommodative”.
In the next policy review in December, the central bank kept the rate on hold with a promise to cut it in future, saying it would “use the space for further accommodation, when available”.
However, this may not cut ice with Rajan. He would probably want to be convinced that indeed the government is on the fiscal consolidation path before going in for a rate cut, probably the last, till clarity emerges on the course of the monsoon and food inflation.
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Despite calls from many quarters, including from sections within the government, to slacken the fiscal consolidation road map in the short term and make available funds for more public investment, the Centre is likely to stick to the demanding fiscal deficit target of 3.5 percent of the GDP for 2016-17, according to Financial Express.
The Budget managers reckon that the low global prices — most forecasters opine that until 2017, the prices won’t harden — would help them in two ways: A sharply reduced subsidy bill on oil and, to a certain extent, even on fertilisers and substantial additional revenue from excise duty hikes on diesel and petrol.
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Indian firms, particularly those whose input costs depend on global commodity prices, have improved profitability even though subdued demand continues to weigh on revenue growth, early trends from December quarter earnings suggest.
Profits of 114 of BSE 500 companies rose 34 percent in the three months ended 31 December from a year earlier, the best in at least three years for which comparable data is available, a Mint analysis based on data compiled by corporate database provider Capitaline showed. That beat the 25 percent profit growth in the preceding September quarter.
The revenue growth, however, remained weak, in line with the trend over the last few quarters. Revenue for the 114 companies rose 4.38 percent from a year earlier in the December quarter, marginally faster than the 4.29 percent recorded in the preceding three months.
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Three major Indian IT companies — Infosys, Tata Consultancy Services and Wipro — have joined US President Barack Obama’s ambitious computer science for all initiative as part of a public-private collaboration, pledging over $3 million in grants.
Obama announced his ‘Computer Sciences for All’ plan in his weekly address on Sunday as he emphasised the need for teaching the subject as a “basic skill” to all children across schools in the country in a changing economy.
While Infosys has pledged a $1 million in donation, Tata Consultancy Services is providing support in the form of grants to teachers in 27 US cities, the White House said in a fact sheet.
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The Union Budget for 2016-17 is likely to exempt unsponsored American depository receipts (ADRs) and global depository receipts (GDRs) based on underlying Indian securities from capital gains tax. The move could be aimed at encouraging such listings. Besides, such exemptions might also come for ADRs and GDRs based on Indian unlisted stocks and securities other than equities.
Also, the relief is currently given only to sponsored ADRs and GDRs, not the unsponsored ones.
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Union Health Minister JP Nadda has said the Centre is working on plans to replicate some health related schemes and programmes run by the Gujarat government at the pan-India level.
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Birla Corp is set to buy the cement assets of Anil Ambani-controlled Reliance Infrastructure for about Rs.5,000 crore, according to two people directly familiar with the transaction.
The deal will be sealed within next few days, they said, requesting anonymity.
“It will be signed formally in the coming days,” said one of the two people cited above. “Even though discussions took nearly a month’s time to finalise, other contenders weren’t really considered for the sale.”
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