India will ramp up spending on rural areas, infrastructure and fighting poverty, Finance Minister Arun Jaitley says as he unveils his annual budget, adding the impact on growth from the government's cash crackdown would wear off soon. David Pollard reports.
From the big man to the small, this could have been billed as a budget to please everyone. (SOUNDBITE) (English) INDIAN FINANCE MINISTER, ARUN JAITLEY, SAYING: "The total allocation for rural, agricultural and allied sectors ....." India promising a bigger, 27 billion dollar spend for the rural poor, a 50 per cent cut in the basic tax rate and a 25 per cent hike in capital investment. With a reassurance: that the cash crisis caused by November's sudden withdrawal of popular bank notes is nearly over. As prime minister Modi's nationalist party might hope - ahead of five regional elections beginning this month. (SOUNDBITE) (Hindi) INDIAN PRIME MINISTER, NARENDRA MODI, SAYING: "This budget will generate new employment opportunities, help all-round economic development and will help increase the income of the farmers." And, perhaps, the income of share traders - Indian stocks rising one and half per cent on the speech. (SOUNDBITE) (English) MARKET EXPERT, SUNIL SHAH, SAYING: "Sensex is up by 485. So I think market has given thumbs-up to the Finance Minister's Budget." And for a country which imports 80 per cent of its oil needs, there was an eyecatching proposal to combine about a dozen state-owned oil firms into one national giant. Commodities consumption on the up .... (SOUNDBITE) (English) WILSON KING INVESTMENT MANAGEMENT, HEAD OF RESEARCH, RICHARD HUNTER, SAYING: "Great amount of demand coming through - so you would expect, particularly in terms of that infrastructure, for them to be picking up some of the slack that might have been left behind by China. Which all things being equal, should be positive." Growth is seen dipping to 6.5 per cent this year. And some sceptics say finance minister Jaitley may struggle to hit deficit targets. Indian benchmark yields easing up on that thought - in a sign some, after all, weren't quite so pleased as others.