Investment Valuation in India

Interim Budget 2014 Highlights Fiscal Deficit for 2013-14 at 4.6 percent of GDP Revenue Deficit for 2013-14 at 3.3 percent The current account deficit (CAD) projected to be at USD 45 billion in 2013-14 down from USD 88 billion in 2012-13. WPI inflation down to 5.05 percent and core inflation down to 3.0 percent in January 2014. Food inflation down to 6.2 percent from a high of 13.8 percent GDP growth Q3 and Q4 of FY 14 expected at 5.2 percent and that for FY 2013-14 estimated at 4.9 percent Through the Direct Benefit Transfer (DBT) Scheme, a total of Rs 628 crore (54,20,114 transactions) has been transferred directly to the beneficiaries till 31st January 2014 under 27 Schemes. Excise Duty Item Description Old Rate (Excise) New Rate (Excise) Notes Small Cars, Motorcycle, Scooters and commercial vehicles 12% 8% Applicable till 30-Jun-14 SUVs 30% 24% Applic...

Keyman Insurance Policy has, for long been an easy way to pass on tax free benefits to the key managerial personnel of an organisation. Just as a company insures its lands, building and other assets, it can insure its human resources as well so that it can compensate itself for loss of human assets. Earlier the companies and senior management have misused the concept for personal tax free benefits. For Keyman Insurance Policies, the companies pay the premium and any sum received from the Insurance company on maturity or on the death of the employee including bonus, if any was considered to be taxable income in the hands of the employer under the head Income from Gains from Business / Profession (PGBP). However, most Insurance policies allow assigning the policies to the insured himself and the companies used to assign the policy to the managerial person himself. In this case, the policy did not remain a Keyman Insurance Policy and became a normal Life Insurance policy. The matur...

Chief Economic Advisor Raghuram Rajan tabled his first ever Economic Survey. Key features of the Survey are: GDP growth for 2012-13 is expected at 5% GDP growth for 2013-14 is expected at 6.1% to 6.7% The Average WPI Inflation has come down from 8.9% in 2011-12 to 7.6% in 2012-13 The Average CPI Inflation has increased from 8.4% in 2011-12 to 10.0% in 2012-13 Gross Fiscal Deficit has come down from 5.7% of GDP to 5.1% of GDP Revenue Deficit has come down from 4.3% of GDP to 3.5% of GDP The trade deficit increased to US$ 189.8 billion (10.2 per cent of GDP) in 2011-12 as compared to US$ 127.3 billion (7.4 per cent of GDP) during 2010-11. Current account deficit seen at 4.6% for 2013-14 Overall global economic environment remains fragile Gold imports is key contributor to inflation, imports need to be curbed LPG and Diesel prices need to be increased in line with global rates, oil subsidy is a key risk

Key Features of Budget 2012-2013 APPROACH TO THE BUDGET  For Indian economy, recovery was interrupted this year due to intensification of debt crises in Euro zone, political turmoil in Middle East, rise in crude oil price and earthquake in Japan.  GDP is estimated to grow by 6.9 per cent in 2011-12, after having grown at 8.4 per cent in preceding two years.  India however remains front runner in economic growth in any cross-country comparison.  Monetary and fiscal policy response for better part of past 2 years aimed at taming domestic inflationary pressure.  Growth moderated and fiscal balance deteriorated due to tight monetary policy and expanded outlays.  Indicators suggest that economy is turning around as core sectors and manufacturing show signs of recovery.  At this juncture, it is necessary to take hard decision to improve macroeconomic environment and strengthen domestic growth drivers.  Twelfth Five Year Plan to be launched with the aim of “fa...