Budget Reforms to Boost FDI and Domestic Manufacturing

The latest Budget announcements, including simplified FDI and overseas investment regulations and reduced corporate tax rates, aim to boost capital inflows and support domestic manufacturing. The abolition of the Angel tax will also encourage investment in startups. Changes in customs duty rates are designed to enhance local value addition and export competitiveness.

Deloitte India has lauded the recent Budget announcements aimed at bolstering capital inflows and domestic manufacturing. The simplification of FDI and overseas investment regulations, coupled with reduced corporate tax rates, promise to significantly enhance the country's investment landscape.

The abolition of the Angel tax is seen as a positive step toward encouraging investment in startups. Economist Rumki Majumdar emphasized the importance of stable capital for investment, noting that FDI can substantially boost private capex in greenfield and brownfield projects.

Further, Saloni Roy, Partner at Deloitte India, highlighted changes in basic customs duty rates across various sectors, including medical, mobiles, minerals, solar energy, and telecommunications. These changes aim to support domestic manufacturing and promote export competitiveness.

(With inputs from agencies.)