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Post Budget Scenario


Power & Engineering sector

Budget Offers
Budget has been disappointing from the power sector's point of view 10 year tax holiday for investments in infrastructure to continue. For investments made prior to March 2003, the tax holiday is applicable from retrospective effect.

New electricity bill will be introduced soon. There was also a mention of increasing user charges for services provided by the government. If electricity charges for farmers and other subsidised class of users are rationalized then it will be positive for the sector. But there is no clarity on that yet.

Dividend tax reduction to 10%.

The Imapct
Budget Impact
Nothing concrete. The FM and the Prime Minister had built up a lot of expectations to give a push to infrastructure and in particular investments in the power sector. Nothing on that front.

Dividend Tax Impact
Tata Power will benefit a little more than BSEs from the reduction in the dividend tax.