There is a clear boom in investment. The saving rate and the investment rate have gone up to 35.6% and 36.3% respectively by the end of 2007-08 against 29.8% and 28.2% in 2003-04. Even the foreign investment points to this boom during April-December 2007. The Direct Foreign Investment amounted to $12.7 billion and the Foreign Institutional Investment stood at $18 billion.
Power:
The XIth five-year plan (2007-2012) targets an additional power generation capacity of 78,577MW, which is more than the total capacity added in the previous three five-year plans. Commercial operations for 10,000MW is expected to be achieved by March 2008. The FM has provided Rs 800 crore in 2008-09 for the accelerated Power & Development and Reforms Project. However since the real drag on the sector is the poor state of transmission & distribution (T&D) the FM proposes to create a national fund for reforms in T&D sector.
Oil & Gas:
The bidding process under the New Exploration Licensing Policy had invited bids for 57 blocks in December 2007. It is estimated that investment of $3.5 billion to $8 billion will be attracted for exploration and discovery.
Biggest Gainers of the Budget 2008-9
Automobiles
- Maruti, Tata Motors, Bajaj Auto, Hero Honda, Ashok Leyland
Banking
- PSU Banks, ICICI, HDFC
Infrastructure
- L&T, BHEL, Punj Lloyd, Power Grid, Crompton Greaves
FMCG
- Nestle, HUL, Tata Tea, Heritage Foods
Hotels
- Indian Hotels, Taj GVK, Hotel Leela
Healthcare
- MNC Pharma Companies, Cipla, Apollo Hospitals, Fortis, Panacea Biotech
Cement
- Shree Cement, Madras Cement, ACC, India Cement
Information Technology (IT)
- Negative for the sector as the benefits under Sections 10-A and 10-B were not extended
| Old slab (FY2007-8) | Tax Rate (%) | New Slab (FY2008-9) | Tax Rate (%) |
| Upto Rs 1,10,000 | Nil | Upto Rs 1,50,000 | Nil |
| Rs 1,10,001 to Rs 1,50,000 | 10 | Rs 1,50,001 to Rs 3,00,000 | 10 |
| Rs 1,50,001 to Rs 2,50,000 | 20 | Rs 3,00,001 to Rs 5,00,000 | 20 |
| above Rs 2,50,000 | 30 | above Rs 5,00,000 | 30 |
Note: # There is a levy of 3% education cess over the tax calculated as per above slabs.
Other articles on Budget 2008-9:
