Mr Ravi Narain, Managing Director and CEO, NSE, said:
“At the macro level, the market was looking for performance on and commitment to fiscal consolidation. The honourable Finance Minister has clearly delivered on this front: Given the high growth momentum of the economy and the upcoming tax reforms, the future projections look credible.The Budget seeks to give a substantial boost to foreign investment in India.
First, SEBI registered mutual funds have been permitted to accept subscriptions from foreign investors — institutions and retail — for equity schemes. This permission to foreign retail investors is a watershed development in the history of Indian capital market. Regardless of how much retail foreign investment actually flows into India in the coming months, the announcement sends a big message to the global investor community about India's commitment to globalisation of the capital market.
Secondly, the limit on FII investment in corporate bonds has been raised substantially — from $20 billion to $40 billion; the entire increase in limit has been with respect to infrastructure companies — listed or unlisted.
The unused limit thus far is not an indication of low interest of FIIs in Indian corporate bond market, but because of the time taken by the FIIs to set up debt monitoring capacity, which is generally the case.
Finally, the proposal to reduce the surcharge on corporate taxes from 7.5 per cent to five per cent is likely to cheer the market.”