While the Union Budget lacks measures to boost the slowing economy, the proposed tax regime has made the system more complicated, said globally-renowned market strategist Chris Wood in the latest edition of his hugely followed Greed & Fear report.
According to him, the Budget has helped neither the mortgage sector nor the automobile segment, where vehicle sales are dipping, and the increase in import tariffs was another negative, which also hinted that the ‘Make in India’ programme has not been successful.
“As for the Budget itself, while the stated intention to remove all deductions in the long run is a positive in terms of a general principle, in this case, the changes have only served to make the tax system more complicated, not less,” stated the newsletter, which is widely circulated among institutional investors.
In the Union Budget announced on February 1, Finance Minister Nirmala Sitharaman proposed a lower tax structure with the condition that the individual will forgo all current available exemptions.
Terming the Budget an ‘anticlimax’, the market strategist said that it lacked measures “which might convince investors that the economic cycle is poised to turn up.”
While referring to the increase in import duties on electronics, electric vehicles and other goods, Mr. Wood said that this was a reminder that the ‘Make in India’ programme introduced in 2014 “has not made much progress.”
“The manufacturing sector’s share of Indian nominal gross value added has declined from 17.1% in FY16 to 15.9% in the year to September 2019, the lowest level since FY71,” the report said.
