Winners and Losers: Who Got How Much in India's Annual Budget

Nirmala Sitharaman maiden speech saw a lot of table-thumping by her party members and allies as the opposition silently looked on.

Winners and Losers: Who Got How Much in India's Annual Budget
A weighing scale stands next to sacks of grain at a wholesale grain market in Rewari, Haryana, India. (Photographer: T. Narayan/Bloomberg)

(Bloomberg) -- Prime Minister Narendra Modi’s first budget since sweeping to victory in the recent national election has sought to boost investments while continuing his government’s focus on social sector spending.

In her maiden budget speech Finance Minister Nirmala Sitharaman announced plans to sell India’s first global sovereign bonds and ease rules for overseas investors to help revive economic growth -- amid much table-thumping by her party members and allies as the opposition silently looked on.

Here’s a short list of winners and losers from the announcements today.


State-Run Banks

A plan to infuse capital worth 700 billion rupees ($10 billion) and provide a partial one-time guarantee on loan defaults on borrowings by shadow banks may help state-run banks. And shielding lenders by strengthening the Reserve Bank of India’s regulatory hold on default-prone non-banking finance companies could help the beleaguered State Bank of India Ltd., Bank of Baroda, Canara Bank, Union Bank of India, Bank of India and Punjab National Bank, among others. The S&P BSE Bankex of lenders gained for a third day to near a record set in May.

Rural India

From raised spending on road building to connect villages, to more rural homes built with power and fuel connections and support for small businesses producing cattle feed, the government’s continued push could benefit companies with exposure to rural India. That includes Godrej Agrovet Ltd., ITC Ltd., Hindustan Unilever Ltd. and Mahindra & Mahindra Ltd., all of whom have interests across the Indian heartland. A gauge of fast-moving consumer products companies rose for a sixth day, the longest streak of gains since March.


Sitharaman said the government will consider further opening up foreign direct investment in aviation. Apart from announcing another plan to sell state-owned Air India Ltd., the government also announced a plan enter aircraft financing and leasing. This would benefit Air India Ltd., SpiceJet Ltd., InterGlobe Aviation Ltd. and TATA SIA Airlines Ltd.


Winners and Losers: Who Got How Much in India's Annual Budget

The plan to provide piped water across Indian households by 2024 and the focus on managing the nation’s resources by consolidating the country’s scattered water administration under the Water Power ministry underlines the seriousness of India’s rising shortages. Shakti Pumps India Ltd., Jain Irrigation Systems Ltd., KSB Ltd., Kirloskar Brothers Ltd., VA Tech Wabag Ltd., JK Agri Genetics Ltd., PI Industries Ltd. could benefit.


Sitharaman’s promise of a model tenancy law for lessors will be a welcome move for millions across growing cities where 87.7 million citizens are expected to live by 2050. Especially the financial capital Mumbai -- a city where high property prices force many to stay in leased or rented apartments.

Real Estate & Construction

Sitharaman’s promised to build 19.5 million rural homes by 2022. That’s in addition to the continued focus on building roads under the national highways and rural roads programs. This would directly benefit Larsen & Toubro Ltd., Dilip Buildcon Ltd., IRB Infrastructure Ltd. GMR Infrastructure Ltd. Oberoi Realty Ltd., Prestige Estates Projects Ltd. and DLF Ltd.


Jewellers, Gold Importers

Jewelry stocks tanked as an increase in import tax boosted domestic prices to a record. That would make jewelry even costlier for buyers in the world’s second-biggest market ahead of the festival and wedding season starting from August. Sitharaman raised import tax on gold to 12.5% from 10%. Jewelers had sought a reduction in the taxes with the World Gold Council saying there was a strong case to cut the tax now due to a thriving grey market. Losers include Titan Co., PC Jeweller Ltd., Vaibhav Global Ltd. and Tribhovandas Bhimji Zaveri Ltd.


The Indian defense spending for financial year 2019-20 was pegged at 3.05 trillion rupees ($45 billion), with no change in the allocation made in February’s interim budget. Although this is higher than the revised estimates from the previous fiscal of 2.85 trillion rupees, it’s only going to keep pace with inflation and does not represent a real increase. The exemption in Customs Duty for imported military equipment was the only solace the armed forces received from Sitharaman, who was the Defense Minister in Modi’s first term.

High and Middle-Income Earners

Winners and Losers: Who Got How Much in India's Annual Budget

Wealthy and middle-class tax payers have a reason to groan. Sitharaman proposed to raise tax on income earners above 20 million rupees. Not just that, India sought to discourage cash payments by levying 2% tax on withdrawal of over 10 million rupees in a year. In addition, tax payers will have to spend an extra two rupees on every liter of gasoline and diesel they buy. That’s going to have a cascading effect on inflation as travel and food costs rise.

Auto Parts

India’s plans to shift its long-term focus on electric vehicles could hurt the growth of auto part makers. Not only did the government announce plans to make India a global manufacturing hub for electric vehicles and lowered GST on EVs to 5% from 12%, the government also raised basic customs duty on auto parts. This could affect Motherson Sumi Systems Ltd., Bharat Forge Ltd., Minda Industries Ltd, Shriram Pistons & Rings Ltd and
Greaves Cotton Ltd GRV IN.

Rivers & environment

The finance minister spoke about plans to use more of the country’s rivers to move goods within India. Supporters say it will unleash vibrancy in internal trade and complement the roll out of the goods and services tax that will create a single market. Critics say this plan will worsen environmental concerns, destroying vital ecosystems.

--With assistance from Anurag Kotoky, P R Sanjai, Nupur Acharya, Debjit Chakraborty, N. C. Bipindra, Dhwani Pandya, Unni Krishnan and Swansy Afonso.

To contact the reporter on this story: Archana Chaudhary in New Delhi at

To contact the editor responsible for this story: Ruth Pollard at

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