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00:00Santhosh Rao, Head of Research and Partner at Manhattan Venture Partners is joining us
00:04this morning.
00:05Santhosh, I'm sure you got the cliff notes of the budget and the major announcements.
00:09There was a little bit of tinkering with the taxes, but that major change in the capital
00:12gains tax, the simplification of the rules there, how is all of this being viewed from
00:18overseas?
00:19Yeah, I think these are all, thanks for having me.
00:22These are all very positive developments.
00:26I think anytime you simplify the tax structure, tax regime, I think that's very good.
00:33It's very helpful.
00:34And I think that's what they did.
00:35So I think that's good.
00:36I think at a very high level, I would say it's pro-growth, you know, they're investing
00:42in infrastructure, they're investing in jobs, investing in skill sets.
00:47And that's what India needs.
00:49If they want to be the third largest economy in the world, I think what you need is big
00:55companies employing a lot of people.
00:58You need the skill set and you need the infrastructure to move things around very easily.
01:02I think that's all good, viewed very well.
01:05I think I would say if I have to just summarize it, I would say it's a good budget.
01:13Of course, there is some discount for being a coalition government.
01:17You have to throw some meat to your coalition partners.
01:21I think they did that quite a bit here and there.
01:23But that's okay.
01:25Overall, the budget deficit, fiscal deficit of 4.9%, apparently the lowest in five years.
01:32I think that's good.
01:34So all that is a good fiscal discipline, jobs, infrastructure.
01:39That's music to our ears.
01:40And that's what we want India to do so we can invest in there.
01:43Okay.
01:44All right.
01:45So with the budget out of the way then, what are the major triggers that could influence
01:48flows into India, in your opinion?
01:51Will they come through?
01:53Because we've seen selling by foreign institutions in the recent past.
01:57Yeah, I think we had recent volatility because of elections and the coalition governments
02:03and this and that.
02:04There's a little bit of uncertainty out there.
02:06But I think overall, at the end of the day, it's the fastest growing economy in the world.
02:12You cannot really ignore.
02:13This was the case 10 years back with China.
02:15You just couldn't ignore China.
02:17You had to be in it to really participate in the next second biggest economy.
02:22And similarly, the tide is shifting more and more, though the Indian economy is way less
02:26than Chinese, but it's growing and there's tremendous opportunity here.
02:31So I think people are investing.
02:33I think you will see money coming in.
02:36The stock market is good.
02:37It's kind of heavily priced.
02:41It's kind of rich in valuations, but I'm sure money will start pouring in as we start seeing
02:46new announcements from the government.
02:48It's been pretty quiet on the government side.
02:50But as things move along, I think we will see.
02:53I think that's the biggest issue with India has been the follow through, the execution.
03:00The plans are big, but the execution doesn't meet the level of rhetoric that we see here.
03:08So I think in this case, if they can execute very well, if they can follow through on their
03:13plans and just continue with the growth and hit the 8% target that the GDP is growing at,
03:21I think that's great.
03:22I think it'll be viewed favorably.
03:25All right.
03:26Thanks so much for joining us this morning, Santosh.
03:28Always a pleasure having you on the show.