The Fiscal year 2009-10 has been a challenging year for the Indian economy. The last quarter of the year, however, has seen tremendous economic growth, particularly in the maufacturing sector. It now seems, from advance estimates, that GDP growth for 2009-10 would be around 7.2 per cent or more. The fiscal policy direction has been laid out in terms of lowering the fiscal deficit over the next few years, lowering the public debt to GDP ratio, the Direct Tax Code roll out on 1st April, 2011 and introduction of GST by April, 2011. These developments will change the fiscal landscape of the country and will provide a solid and stable platform. A few significant direct tax proposals have been tabled by the Finance Minister but the cheer comes from the household sector where individual income tax slabs have been widened. We are optimistic that the Budget will help India remain globally competitive and with more disposable income, another round of consumption-led growth is very likely, and will propel the GDP growth trajectory to 8%-9%.
PwC India analysis on Budget 2010, including various sector specific snapshots, are available here: