The Budget

The Economic Times article does not mention how much is the excise duty on computers. If you have similar problems access the full text of budget here

Anyways what affects people like me majorly

- The 8% excise duty on computers has been removed. My new computer should cost Rs 2000 less atleast.
- The collateral requirement has been waived for educational loans up to Rs 7.5 lakh from Rs 4 lakh (Doesn't help much. Banks did not follow this anyway)

Anyways this is what I could make of the budget, trying to address the concerns raised by Stephen of Morgan Stanley.

+ Plans to make procedures for registration and operations simpler and quicker for FIIs
+ Investment ceiling for FII's in Debt funds has been increased from US$1 billion to US$ 1.75 billion;
+ As far FDI is concerned, caps have been raised in Telecom (74%), Insurance(49%) & Aviation(49%)
- Disinvestment targets for 2004-2005 reduced to Rs 4000 crore
- Profit making PSU's not to be sold
+ If your taxable income is below 1 Lakh no tax (Rs 9000 saved/year)
? Non Resident Deposits no longer welcome(interest to be taxed)
+ Reasonable Fiscal Deficit at 4.4% of GDP

Capital Gains Tax
- Long term capital gains tax abolished
+ Small investors - Short term capital gains taxed uniformly at 10%from earlier 10%/20%/30% regime.
These two apparently led to the a lot of selling pressure from small investors.

- Transaction tax on all securities (15 basis points)
This one sent the capital markets on a nosedive. Would majorly affect big players, brokers and mutual funds who churn their portfolios often. More so beacuse its across the board and cannot be escaped. (Future and Options and bonds included).The FM also planned to put an end to bonus and divident stripping. No longer can you make a killing by those bonus shares. I hope dad has booked some of his profits.

All the direct taxes of course need to be approved by the parliament first.The criticism of the budget is though it promised "Growth, Stability and Equity", And it does seem to be satisfy the last two of its objectives , the growth part seems to be meant for certain sectors like agriculture

Anyways here it direct from the horse's mouth. An interview with Mr Chidambaram after budget