An Ambitious Budget
As expected, Union Finance Minister Nirmala Sitharaman has presented a please-all budget before the 2024 general elections, touching upon each and every section of the electorate. Throughout her 87-minute budget speech, the Union Finance minister announced a large array of benefits making it one of the most ambitious budgets in recent time, especially taking into consideration the prevailing economic situation. Clearly, Sitharaman has ignored the warnings of the International Monetary Fund (IMF) on recession affecting one-third of the world by the middle of the year and instead decided to chart her own course to gather necessary momentum for the Indian economy. In this regard, a huge jump in capital spending will provide much-needed relief to the economy which is still recovering from the jolt suffered by COVID-19 pandemic. The finance ministry has taken a bold step by hiking capital expenditure to 33 lakh crore, which is 3.3 per cent of the GDP, apart from making record allocation for Railways. At the same time, the agriculture budget has also been increased by 20 lakh crore and Agri Accelerator Fund has been created with the aim to rejuvenate the primary sector of our economy which provides livelihoods to the maximum number of citizens in India. In an effort to ease the plight of the salaried and middle class, she has also proposed to increase income tax rebate limit from five to seven lakh under the new tax system. At the same time, an allocation of INR 15 thousand crore has been made over next three years on tribal groups’ development mission, which will be beneficial for the Northeastern part of the country. Similarly, Sitharaman has made an effort to address the shortcomings in the health sector which were exposed during the pandemic along with education by allocating more funds to these sectors.
On the other hand, Sitharaman did not shown the same amount of boldness in dealing with the corporate sector, despite the sector adopting an indifferent attitude towards the country’s needs. For example, record borrowing of INR 15.4 lakh crore to bridge the revenue gap could easily have been reduced by withdrawing some of the benefits offered to the corporate sector during the pandemic to generate much-needed capital for an ailing economy. But as no notable investments have been made since, the sops could be withdrawn especially as normalcy has nearly been restored. But in her own wisdom, the Union Finance Minister has decided not to touch the corporate sector at least for the time being despite non-cooperation from this sector. Rather, a number of encouraging steps have been taken in this year’s budget too to lure the corporate sector. Moreover, revenue earning is another area which has not received enough attention in this year’s budget. Many expected that the budget would put thrust on export, rather than import to garner revenue. Surprisingly, no export-oriented proposal has been made in the budget. All in all, Sitharaman has stuck to her priorities of inclusive development, infrastructure and investment, green growth, using youth power among others but, some issues which also need serious focus have been left unattended.