Sankaran Naren, CIO-Equity, ICICI Mutual Fund, feels that the upcoming budget should retain tax benefits on ELSS to ensure mutual funds have a deeper penetration.
What key priorities and concerns should the budget address?
What key priorities and concerns should the budget address? The most important and crucial area is clearly going to be a road map for fiscal consolidation. Fiscal consolidation will be imperative for providing comfort to RBI on initiating monetary easing through rate action. Also, increased focus on investment in infrastructure by utilizing revenue received through effective taxation and disinvestment will benefit the economy and facilitate growth sustenance.
What measures do you think are needed to make our capital markets stronger?
Removal of STT for equity markets will help the capital markets by increasing and improving return potential. This apart, any initiatives towards economic growth will have an impact on long term capital markets as well by way of increased participation.
With mutual funds still accounting for a tiny fraction of household savings, what needs to be done to make MFs, from a policy perspective, to widen their reach?
Mutual funds today are one of the best investment options for retail investors to participate in equity markets and, at the same time, partner in India’s growth story. From the budget perspective, policies that encourage investments in mutual funds like retaining tax benefits in ELSS will help maintain and improve penetration of mutual funds over the long term.
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