Analyst: India's budget proposal to increase the futures securities transaction tax is detrimental to the capital market.

Raj Gaikar of Samco Securities stated that the proposal in the Indian budget to increase the futures securities trading tax from 0.02% to 0.05% is detrimental to stocks related to the capital market and poses resistance. The research analyst expressed in an email that the rise in trading costs may reduce trading volumes, dampen short-term momentum, and decrease the profitability of active market participants. The involvement of foreign institutional investors in derivatives may also slow down, affecting overall liquidity. Gaikar added that this could have a ripple effect on the revenue sources of brokerage firms, exchanges, and depository institutions, as these institutions are closely linked to market turnover.