Finance Minister Nirmala Sitharaman today announced a massive package that will go a long way in helping India Inc as well as the markets recover from the post-budget beating.In this course correction, first and foremost came the announcement for a Rs 70,000 crore upfront package for PSU banks and then withdrawing of the surcharge being levied on the FPIs that led Indian stock markets to tank by around 1500 points at the 50-stock Nifty index. Industry insiders are of the view that it would not only help Narendra Modi government to handle the liquidity crisis, it would also win back the confidence of the foreign institutional investors (FIIs) that reflected in the recent share market and bond yield crash. Centre also today, removed the so-called angel tax that will provide a big boost for start-ups.

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Commenting on the measures announced by Finance Minister, Sandip Somany, President, FICCI said “This is an extremely welcome move, which will give a major boost to the economy that had started showing signs of a deep slowdown. As these measures take effect, we are sure that these will lift the confidence of businesses and investors alike.”

Somany added, “The stock markets have been volatile ever since the uncertainty with regard to higher tax on FPIs emerged since the announcement of super-rich surcharge in the Union Budget. The announcement to remove the surcharge comes as a great relief for investors and we do hope that the markets will respond positively. Additionally, the decision of the banks to pass on rate cuts through MCLR to benefit all borrowers and to introduce repo rate related loan products should help lower the cost of capital, which has been one of the major asks of FICCI. The move to create an Internal Advisory Committee in banks and by vesting greater powers with the Chief Vigilance Officer within banks should help remove fears amongst Public Sector bankers in taking credit decisions”.

Garima Kapoor, Economist, Elara Capital said, “The main takeaway of today’s announcements by the Finance Minister is that they are aimed at restoring confidence and tackle the challenges of weak demand. Measures that aim at accelerating the payment of dues of government to private sector entities, ensuring timely refund of GST refunds to MSMEs would in particular help to resolve the liquidity crisis in the economy. Withdrawal of surcharge on FPIs and domestic investors would help in alleviating the tax burden on investors in capital markets. Likewise, the quicker transmission of rate cuts, faster recapitalisation of banks and external benchmarking of rates are likely to aid credit off-take. Most importantly, recognition of issues in the economy and the measures to address them is itself a positive signal and will help to ease concerns on growth slowdown.”

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Speaking on the bailout package of Rs 70,000 to the PSU banks by the Finance Minister Nirmala Sitharaman Rajiv Singh, CEO, Karvy Stock Broking said, "This is a welcome step and markets are expected to cheer for it. Release of Rs 70,000 crore upfront for the PSU banks and other major announcements for easing the crisis in NBFCs will help in credit off-take.  A slew of announcements for the Auto sector will help in the revival of the auto industry. The best part is, FM is now open to act on Industry feedback and has promised to announce a few more stimulus measures in the coming weeks. After this much-awaited booster dose, I expect the market to form a base around the current level and inflows will be witnessed in broader markets among quality mid-cap & small-cap stocks. We may witness rally in the favorite stocks of FIIs which majorly constitute our benchmark Index."

Geetika Dayal, Executive Director, TiE Delhi-NCR said, "Reforms in the policy are critical for the startup ecosystem to grow by leaps and bounds. The removal of Sec56(2) and set to the CBDT special cell for startups is a step in the right direction. We hope this helps in resolving the remaining and emergent challenges in the Indian start-up ecosystem. This initiative looks very promising and we are looking forward to its speedy and proper implementation."