As the country awaits first Budget of the Narendra Modi-led government, top banker Chanda Kochhar feels it can't ignore harsh realities like the tough fiscal situation as well as rising prices and would need "tight control" over both expenditure and populism.
Kochhar, who heads the country's largest private sector lender ICICI Bank, said Budget would need to provide a clarity on the prospective nature of taxation, as also other rules and regulations, besides lining up necessary steps to clear the projects that have been struck to boost the investor confidence.
Finance minister Arun Jaitley, who recently said that India has to make a choice between mindless populism and fiscal prudence, will present the Budget, 2014-15 on July 10.
When asked what 'bitter medicines' people can expect in the Budget, Kochhar said in an interview, “I think there are some realities that neither the Budget nor we can ignore.”
“The fact is that the fiscal situation is quite tight and so we need to take a proper stock of the fiscal situation ... Then, it is a fact that the oil prices are going up because of the Iraq issue and then we do not know how the food inflation would move given the current monsoon situation.
She said these are clearly the realities that "we are facing and I am sure that when a responsible government makes the budget, no one can run away from these realities. So, there will have to be a very tight control on both expenditure and populism.”
She added: “At the same time, one should also focus on what are positive steps that can be taken to increase the revenue side, and therefore one has to manage both the sides. Therefore, we need to kick-start generating cash flows... We would also have to look at how can be improve the supply side of food.”
"We also need to think what can we do to the entire agriculture chain to reduce the wastage, make distribution more efficient. That way also, we can reduce some pressure when it comes to food inflation.”
ICICI Bank to open branches in China
With an eye on 'India-linked' business expansion on foreign shores, the country's top private sector lender ICICI Bank is all set to start full-fledged branches in China and South Africa in the current fiscal. The bank has representative offices in these two nations and it has now got regulatory approvals to convert them into branches, ICICI