And for a Friday, post the first Budget of Modi 3.0, some thoughts….. some musings…..
Honestly, every budget is a financial statement of the Central Govt and some forward looking policy indicators. This budget and all the political formulations after the 2024 elections have clearly sent out loud messages to all international investors. Political stability, policy continuity and one of the best regulated and efficient financial markets with trade settlements in T+2 days. Even the most developed economies are unable to match this level of efficiency. Personally, what I missed in this budget are some drastic and dynamic changes; like mopping more resources from the Rich Agriculturists and super rich politicians who also have huge cash flows, camouflaged as farm and other non-taxable incomes. Introducing Income Tax on Agri income was imperative. Income is Income. Nothing sacrosanct about agriculture. Yes ofcourse, the poor and marginal farmers with less than 2 acres must be protected in rural India. Their plight is totally understandable, same as the poor daily wage labourer in urban India. Poor need support. But the tax paying salaried urban middle class cannot be crushed and squeezed to take away their hard earned money thru mounting Direct and Indirect Taxation. Unfortunately, no govt has succeeded in widening the tax net to those who make huge money and not pay taxes.
The Indian Economy is on sound footing. GDP growth at minimum 7% can be assumed confidently. It is time for average middle class Indians to re-look at their savings and investments. Every family must have some investments in inflation beating assets. Property as an asset class is loosing its charm. Apart from a house to stay, all other property assets must be monetised and moved to digital wealth. RBI Sovereign Gold Bonds or ETF Gold funds etc. etc. which capture the security and liquidity of gold as an asset without any holding risks. But most important is to take part in the India Growth story thru stock market. Enter by starting a monthly SIP with a flexi-cap fund in any mutual fund with the smallest amount of investable surplus or just an Index fund. Later add a Balanced Advantage Fund and finally a Multi Asset Fund. These three Mutual Funds should take care of your wealth creation over the next decade and onwards. Don’t worry about individual companies and stocks. Leave that to the stalwarts and stock market specialists.
Every year during budget, as the Government presents its balance sheet, let’s also relook at our own investments and reboot the savings, the digital way, the smart way, the SEEGOS way.