E-Paper
'Budget like never before' cheers markets, Sensex and Nifty rally
Budget 2021: On the Sensex, IndusInd Bank was the top gainer, rallying over 10 per cent, followed by ICICI Bank, HDFC, Bajaj Finserv, M&M and SBI.
Finance minister Nirmala Sitharaman had promised a "budget like never before" this year, and looking at the cheer from the markets, budget 2021 seems to have fulfilled its aim.
The Sensex and Nifty surged as Sitharaman announced schemes for various sectors and categories of people. In terms of points, the Sensex jumped by over 2,000 points at 48,226 and Nifty surged 462.5 points to trade above the 14,000-mark.
On the Sensex, IndusInd Bank was the top gainer, rallying over 10 per cent, followed by ICICI Bank, HDFC, Bajaj Finserv, M&M and SBI.
To push growth via infrastructure creation, Sitharaman proposed raising the government's capital expenditure for FY 2021-22 by 34.5 per cent to ₹5.5 lakh crore.
Sitharaman also said the government would infuse ₹20,000 crore into public sector banks (PSBs) in 2021-22, to meet the regulatory norms.
She also announced that the government will set up a company to manage bad debt for banks, which is expected to reach record levels this year.
The firm will hold problem loans for banks, which can then be sold on to investors at a reduced price, according to the plan outlined by the finance minister in her budget speech on Monday.
According to Reserve Bank of India's Financial Stability Report published last month, the non-performing assets will rise to 13.5 per cent of total advances by the end of September from 7.5 per cent a year ago.
After carrying out the merger of various government banks in 2019 that reduced the number of large state banks to 12 from 27, the government has been looking to reduce its stake in some lenders to raise much-needed cash.
