Jamal Mecklai, CEO, Mecklai Financial

It is clear that the FM will be fully focused on bringing the deficit down – the (finally) aggressive moves on the fertilizer subsidy confirms this. To my mind, this would be market positive in the anything-but-extremely-short term.
In addition to bringing excise levels back to square one, the FM should articulate a stronger disinvestment agenda, acknowledging the intention to bring government holding in at least some entities down to 49%. This would not only generate much needed receipts, but would also render the respective PSU’s freer of CAG, CVC and such like, which often serve to limit management flexibility and reduce enterprise value.
The FM should also push towards bank consolidation, recognizing that greater efficiencies (both of scale and operations) would, amongst other things, accelerate development of the moribund interest rate market, which, in turn, would improve the government’s borrowing cost, reducing the deficit. More effective ALM operations in PSU banks would also lead to a vibrant interest rate derivative market, which would increase the attractiveness of investments in infrastructure, since the long term funding risks would be reduced.
To improve price discovery and market access for the agriculture sector, the Forward Markets Commission should be brought under the Ministry of Finance.

Jamal Mecklai, CEO, Mecklai Financial