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Fixed Deposits
Big gains for banks from 80C
Our Bureaus
March 1
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The banking system had been pleading for the extension of the 80C benefit to fixed deposits placed with scheduled commercial banks. By acceding to the demand, the Finance Minister has helped banks mobilise long term resources. This, in turn, would help them fund long-term infrastructure projects without caring for any asset-liability mismatch, said Mr P. K. Gupta, CMD of United Bank of India. The proposal to unwind special securities with PSU banks by converting them into SLR securities would improve the availability of paper in the debt market and generate liquidity for the banks concerned. Several measures to push agricultural production would entail the increased participation of banks in the development of the rural sector and this is a step in the right direction, Mr Gupta added.
Mr V.K. Chopra, Chairman and Managing Director of Corporation Bank, has termed the Budget 2006-07 as a positive Budget. He told Business Line here on Tuesday that the Government had taken a timely step by including food processing in priority sector, he said
Mr Anantakrishna, Chairman and Chief Executive Officer of Karnataka Bank Ltd, has said that the redeeming factor in the Budget 2006-07 is the proposal to exempt fixed deposits, over five-year maturity period, from tax net for savings under Section 80C of the Income Tax Act. He said the limit could have been increased a little more.
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