Ahead of Friday's interim Budget, CNBC-TV18 brings you a primer on the most important numbers in the annual financial statement.
In an interaction, Amandeep Chopra, group president & head of fixed income of UTI MF, R Sivakumar, head-fixed income of Axis Mutual Fund and Jayesh Mehta, MD & country treasurer of Bank of America, shared their views on the likely Budget outcome.
“There is very little expectation that the government can meet 3.3, so there is likely to be a slippage. If there is a slippage to 3.5 that also means that the future course of consolidation also gets further delayed. So the market kind of accepted that there will be a 2-3 year slip up in the deficit numbers,” Sivakumar said on Thursday.
With regards to the market borrowing number, Mehta said, “6.6 is coming at 3.3 and maybe at 7 people would be a bit comfortable. So maybe 3.3 going to 3.5 is something people would be comfortable, but all the numbers about minimum wages, farmers, anything between Rs 70,000 crore to Rs 3 lakh crore, I personally think is just a talk. I do not think it is coming. However, I am hopeful.”
When asked about the bond market, Chopra said, “Elections or announcements around the budget are a near-term event. They do swing the market over 1 to 3 month period but eventually what matters is many other macro variables.”
“You will see additional bank recapitalization as well as dividend from RBI is more or less factored in. The numbers vary from Rs 30,000 crore odd to as high as Rs 40,000 crore. We need to see what the number but it will be important from broader perspective of trying to meet not only current financial year’s fiscal numbers but also for the coming financial year,” he added.