Unaccounted money penalty could have been lower

The amnesty window for unaccounted money is a good initiative. It could have been more effective if the percentage of penalty was lower.

Every budget has two sides. It is impossible to satisfy everyone but one has to look to the basics, whether the budget is going to help the economy. Looking to the demand for fiscal reforms on one side and the challenge of global headwinds on the other, the government’s decision to adhere to fiscal consolidation makes the budget pragmatic and prudent.

Coupled with agriculture, rural and infrastructure spending, plus roads and highways, the economy will have a resultant effect of bottom-up demand and generation of job creation. The auto sector will stand to benefit by the proposed amendment to the Motor Vehicles Act to allow private sector participation in passenger vehicles segment.

The amnesty window for unaccounted money is a good initiative. It could have been more effective if the percentage of penalty was lower. Moreover, tax on dividend above Rs 10 lakh is a big disincentive to promoters and large investors. Bank recapitalisation is a welcome move.

However, we don’t see any incentive for NRIs who are the natural resource base of the country.

(as told to Prasun Sonwalkar, London)