Prateek Agrawal is the Business Head & CIO at ASK Investment Managers
Prateek Agrawal, Business Head and CIO at ASK Investment Managers, says a Budget that meets expectations is a growth-oriented budget.
“The government has been less focussed on fiscal prudence and more on finding money to fund and catalyse growth which is a positive,” Agarwal shares his views on the Union Budget 2022 during an interaction with Moneycontrol.
ASK has not spotted any negative announcements in the Budget tabled in Parliament on Tuesday. “We did not expect any, either,” he says. “With the stress in the economy, the Budget was expected to keep the positivity intact and there it seems to have succeeded.”
Excerpts from the interaction with Agarwal:
Did the Budget meet your expectations? How would you rate it?
Yes, it has met my expectations.
Click Here To Read All Budget Related News
There is stress in the economy. One section of the population, particularly in contact-intensive services, has not recovered yet from the COVID blues. Growth of the economy is the only way to address this issue and the Budget has prioritised growth, apart from extending some support to the distressed spaces.
It is an exercise in continuity and is not disruptive.
Do you think it is growth-oriented with the government doing a fine balancing act?
Yes, we think it is a growth-oriented Budget. The government has been less focussed on fiscal prudence and more on finding money to fund and catalyse growth, which is a positive. Production linked incentive (PLI) schemes, which are a large success, would actually gain momentum in this fiscal and provide growth. However, lower fuel taxes and higher interest costs are constraining the fiscal space.
Also read – Finance Minister Exclusive: Nirmala Sitharaman On Government’s Growth Vision Under Budget 2022
What was the most surprising announcement made by the finance minister in her Budget speech?
Well, the Budget was mostly on expected lines. I had not expected taxation on crypto currencies to be announced and that was a surprise.
Have you spotted any negative announcements with respect to equity market, FIIs, retail investors and so on?
No. There was no negative announcements. We did not expect any, either. With the stress in the economy, the Budget was expected to keep the positivity intact and there it seems to have succeeded.
Also read – Crypto finds space in Budget 2022; here’s what the industry thinks
Which sectors would bet on, or which are the sectors one must have in portfolio, after the Budget?
The Budget does not change our sector preferences. We continue to like retail lenders, beneficiaries of China+1 such as chemicals and API businesses, IT services and internet businesses, PLI beneficiaries and cement. With chance of softening of commodity prices, consumers with pricing power should also do well.
Do you think this Budget has put a clear roadmap for India to realise its $ 5-trillion dream by 2024-25?
Also read – The big positives and one vital negative in Budget 2022
The Budget offers a clear focus for the future from new technologies and spaces. It is an exercise in continuity. PLI schemes have been announced and they would go a long way in propelling India towards a more modern large economy. The global macros are providing a tailwind and our exports are also buoyant. In a high growth and high inflationary scenario, there is a chance that we end up being a $ 4-5 trillion economy in FY25.
Are you happy with the government’s divestment programme set in the Budget 2022?
I think the numbers are conservative. Lot of the initiatives such as IDBI, BEML and LIC are ongoing and I believe that they would fructify over a period of time. The government has done well to not bind itself to a large number.
As per your reading, what are the missing factors that the government should have done in the Budget 2022?
The Budget is not the only policy statement that the government makes on the fiscal side during the year. As a country, we have successfully responded to the needs of the time (COVID stress) at short notices over the past two years and the same could continue.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
