Business
Higher standard deduction for salaried may be part of tinkering
The Union Budget 2022 may include a higher standard deduction for salaried taxpayers and tax incentives related to affordable housing.
Emkay Global Financial Services said in a report that on the revenue front, gross tax/GDP ratio is expected to increase to 10.7 per cent amid healthy tax buoyancy across segments. Though we do not see any major changes in taxes, we do not rule out minor tinkering in the form of higher standard deduction for salaried taxpayers; tax incentives related to affordable housing; or marginally higher customs duties on PLI-related finished/semi-finished products. Separately, lower non-tax revenue will be led by lower RBI dividends.
The spending focus will likely be on welfare, rural, health and MSMEs. We will also watch for financial sector initiatives (resolutions, higher FPI limits to facilitate divestment in select PSBs on sale, etc.), which could improve the efficacy of the financial sector’s ability to fund the recovery better, the report said.
Amid various push and pull, FY22 GFD/GDP could just about balance at 6.8 per cent. Positive buffers such as bumper RBI surplus, robust tax collection, and higher nominal GDP could get offset by higher payouts than budgeted on food, fertiliser subsidy, health, NREGA, Air India SPV; and possible miss on ambitious divestment targets (despite possible mega LIC IPO in March 2022).
Asset-sale execution will undeniably become the key balancing aspect, especially with a healthy NMP pipeline. We pencil in a modest divestment of Rs 800 billion, and do not account for any major 5G spectrum windfall amid limited clarity on the reserve price, the report said.
The upcoming Budget faces acute policy trade-offs between nurturing a nascent growth recovery and diminishing fiscal space with challenging debt dynamics. The uneven recovery post the pandemic raises questions about the sustainability of demand, especially as the labour market is also potentially divided. For targeted policy responses, fiscal policy tends to be more effective than monetary policy. Thus, a delicate balance needs to be maintained, ensuring the fiscal impulse is maximized to boost potential growth, even as policy adherence to medium-term fiscal sustainability is signalled, the report said.
This would require the expenditure-to-GDP ratio remaining healthy, front-loaded investment-focused stimulus, especially amid its larger multiplier effect on growth and employment. This necessitates innovative reforms, better resource allocation, and possible fiscal funding by aggressive asset sales in the form of existing functional infrastructure monetisation, disinvestments, and strategic sales, among others.
Business
India seen as credible broker for Russia-Ukraine peace talks: Report

India is seen as a credible country that can help in the peace talks between Russia and Ukraine because it is one of few major powers with working relationships with both countries, according to a report in Al Jazeera.
It cited a foreign affairs expert as saying that India’s strategic autonomy puts it in a position to push for peace because New Delhi is “friends with both” sides.
India has also been even-handed. In July, it summoned Moscow’s charge d’affaires to condemn a Russian strike on a merchant vessel that killed 10 people, including four Indian crew members. Days later, it summoned Ukraine’s ambassador over an Indian seafarer killed in a Ukrainian drone strike on the MV Omorfi, the report observes.
It highlights that India is also an importer of goods from both Russia and Ukraine. In the 2025-26, India imported 1.46 million tonnes of sunflower oil from Russia and 443,000 tonnes from Ukraine, according to the Indian Solvent Extractors’ Association (SEA), alongside large volumes of Russian crude.
The article cites Maximilian Hess, a fellow at the Foreign Policy Research Institute, as saying that Zelenskyy approached India “because they have leverage over Moscow, and they are still one of the few major buyers of its oil.”
He added that a large amount of Russian money sits in the Indian financial system, which Moscow wants to keep access to.
Before Russia’s full-scale invasion in 2022, about a third of the world’s grain exports passed through the Black Sea, with Ukraine supplying a tenth of global wheat exports and 15 percent of maize. Disruption hits food-importing countries hardest, particularly in Africa and parts of Asia, the report states.
Indian officials point out that India as a leading voice of the Global South is keen that food exports to these developing nations resume to prevent adequate supplies and controlling rising inflation.
Both Ukrainian President Volodymyr Zelensky and Prime Minister Narendra Modi have discussed the issue of opening the food corridor over a phone call.
“India is ready to mediate in establishing food corridors, and we are counting on these efforts to continue,” Zelenskyy posted on X after call. The leaders discussed Russia’s blocking of grain exports in the Black Sea, he said.
PM Modi said India was ready to contribute “in every possible way” towards a peaceful resolution of the Russia-Ukraine conflict.
External Affairs Minister S. Jaishankar, during a visit to Kyiv in September, spoke of a potential pause on strikes against Black Sea shipping and energy infrastructure. On October 4, he said India was talking to both Russia and Ukraine about shipping safety, grain and energy exports and “non-attack possibilities”.
Ukrainian Foreign Minister Andrii Sybiha earlier called India’s proposal “the broadest”, because it covers both the Black Sea and energy infrastructure. The US plan offers only a halt to strikes on energy facilities.
Business
FPIs return to Dalal Street, invest Rs 53,739 crore in November so far

Foreign portfolio investors (FPIs) turned net buyers of Indian equities in November, investing Rs 53,739 crore during the first nine days of the month after remaining net sellers for the previous two months, amid improving sentiment towards Indian markets and a global shift away from AI-linked trades.
The latest inflows come after FPIs withdrew Rs 34,843 crore from Indian equities in October and Rs 35,861 crore in September.
Analysts attributed the sharp turnaround to an AI-driven sell-off across major global markets, including the US, South Korea, Taiwan and Japan, which prompted investors to reassess their allocations.
According to analysts, concerns over data centre spending linked to artificial intelligence triggered a correction in AI-focused markets, leading global investors to seek opportunities in sectors and markets less exposed to the AI theme.
India, widely viewed as a non-AI trade, emerged as one of the preferred destinations for foreign investors during this period.
Apart from the change in global investment trends, India’s strong corporate earnings growth and attractive valuations in large-cap stocks also enhanced the market’s appeal.
Analysts noted that foreign investors were particularly active in index heavyweights, with financial services, information technology, automobile and telecom stocks attracting significant inflows.
Data from depositories showed that the Rs 53,739 crore infusion was recorded between November 2 and November 9, covering six trading sessions.
Despite the strong buying in November, cumulative FPI outflows from Indian equities in 2026 remain substantial at Rs 2.41 lakh crore.
In the debt market, foreign investors invested Rs 7,759 crore through the Fully Accessible Route (FAR).
However, they pulled out Rs 591 crore through the Voluntary Retention Route (VRR) and withdrew another Rs 270 crore through the general route.
Market participants believe sustained earnings growth and reasonable valuations in large-cap stocks could continue to support foreign investment flows into Indian equities in the near term, although global macroeconomic developments and investor sentiment towards risk assets will remain key factors to watch.
Business
IT Q2 results beat low expectations, but demand recovery pushed to FY28: Report

India’s information technology (IT) services sector delivered Q2 FY27 results that were modestly ahead of subdued expectations, but the broader recovery in demand is increasingly being pushed into FY28 as companies contend with pricing pressure and AI-driven disruption, a report said on Friday.
The report from BNP Paribas India said investors responded positively to better-than-expected earnings after analysing quarterly results from 15 Indian IT services companies, including five large-cap and 10 mid-cap firms.
Shares of the covered companies rose by a median 5 per cent following the results after having declined about 23 per cent year-to-date in 2026.
The market rewarded better-than-feared revenue, margin expansion and strong deal momentum, while penalising margin pressure and weak deal wins. Demand remains steady but narrow, with the financial services vertical as the bright spot.
“While FY27 headline revenue growth guidance cuts seemed modest, the organic cut was sharper, implying that FY27 organic revenue is likely to trail FY26, with acquisitions filling in the gap partly,” the report said.
“AI-led work continues to grow even as clients demand pass-back of the productivity gains, shrinking the legacy books and pushing down pricing pressure. With seasonally weak H2FY27, companies now expect recovery in FY28, supported by large deal ramp-ups,” the report noted.
Collectively, 60 per cent of the firms beat on revenue and 53 per cent beat on EBIT margin expectations, while 27 per cent missed on revenue growth and 40 per cent missed EBIT margin expectations.
Deal Total Contract Value (TCV) inched up modestly annually in Q2FY27, underpinned by strong wins of three companies. Headcount increased slightly sequentially, while attrition and utilisations improved modestly.
Another recent report said that management commentary across nearly all major Indian IT companies during Q1 FY27 earnings season showed that clients demanded measurable outcomes, governance frameworks and stronger data foundations before committing to large-scale AI rollouts.
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