The survey strikes a warning note on the macroeconomic situation, saying that with the projected GDP growth unlikely to be achieved, both inflation and the fiscal deficit may rise.

The survey notes a number of strengths of the Union budget, which include an attempt to boost economic growth while adhering to fiscal prudence by stressing on policy incentives, political courage in attempts to relinquish government control in non-strategic industries and other organisations, a sturdier safety net for laid-off employees, opening up of the insurance sector to domestic competition, and allowing 10 per cent of provident funds accretions to be invested in the infrastructure sector.

Among other positive points noted by the survey are concernfor non-performing assets of loss-making banks, substantial increase in plan allocation for the energy sector, tax benefits for the housing sector corresponding to an infrastructure status, further streamlining of FIPB procedures for FDI approvals and their guaranteed clearance within 90 days etc.

The survey also notes the big incentives to non-resident Indian fund inflows, and the due importance given to small scale industries as well as increased plan allocation for the social sector as positive features of the Union budget.

Among the negative features, the survey notes, "the GDP figures calculated from the announced fiscal deficit implies a high growth rate which is not likely to be achieved, leading to a deterioration in either inflation rates or the fiscal deficit itself."

The increase in fuel prices will "almost certainly" lead to inflation, notes the survey, and increase the cost-of-living substantially through multiplier effects.

Capital expenditure as a percentage of gross domestic producthas declined to 3.6 per cent from 3.8 per cent in 1996-97, despite claims of increased public investment to boost demand, says the survey.

It notes that borrowings of the government through dated securities is slated to rise by 59.2 per cent to a huge Rs 707.34 billion. It also points out that there is no specific move to improve sentiment on the capital markets.

The survey also notes that not enough attention has been paid to the export sector, while the slowdown in recent times has been a cause for serious concern. No direct measures have been taken to boost demand, the higher levies could actually be contractionary economy turnaround is left to the private players and their attitude towards fresh investment.

"The first impression from the Union budget for 1998-99 is 'substance over style'," says the survey, "the emphasis was on continuity. To that extent all investors who have invested, or are planning to invest, in India will heave aa sigh or relief."