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Budget 2018 Reactions: Financial Sector Benefits From Old Policies Of Capitalization Of Banks, But Certainly On Equities It’s Not Good, Naina Lal Kidwai

"Strengthening of the banks is a much more overarching issue," Naina Lal Kidwai, Chairperson, Max Financial Services

In an exclusive interview with BW Businessworld, Naina Lal Kidwai, Chairperson of Max Financial Services discusses her views on the Budget introduced by the Finance Minister on February 1st. Edited excerpts:

There will be a BW Report Card – On a scale of 1 to 10, how do you rate the budget?

I don’t like rating, because it depends on which parameters you choose. If we look at it as a pro-rural and pro-agriculture budget, I would give it a 9 on 10. For industries, MSMEs, it’s been pretty good and positive, so I would say 6 or 7 on 10. For large industries, its 5 on 10. So it depends on which constituency you are looking at. And on fiscal management, I would give it a 5 on 10. So I would say that it’s a very mixed bag.

Do you feel this is an election budget?

It definitely is.

How will it affect the financial sector?

The financial sector, borrows off everything else. To the extent that that if the MSMES appear stronger, it helps. Clearly, the equity markets suffer because of LTCG. So I would say that the overall banks and the allocation is what it is. So strengthening of the banks is a much more overarching issue. So the financial sector again benefits from old policies of capitalization of banks, but certainly on equities it’s not good, it’s a mixed bag. 

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