Dr. PS Vohra
Writer & Financial Expert
As a conclusion, in the context of this budget, it can be said that through the increase in capital expenditure, there will be a boom in the development of infrastructure and the common man will get financial benefit from the reduction in direct tax
The Modi government has presented its general budget in the Parliament for the upcoming financial year. This is the last full budget of the Modi government before going to the polls next year. Through this budget, the Finance Minister has drawn such a blueprint for the inclusive development of the country, which has laid the foundation stone for far-reaching development on the one hand, and on the other hand has kept the common man higher priority.
There was a lot of inquisitiveness in the society about this budget and everyone expected economic reforms from the government, through which the country’s economy could be given a new dimension at a rapid pace. The current financial year has seen very good results after Covid – 19 pandemic which has resulted India to become the fifth largest economy in the world. Through this budget, an attempt has been made to develop a thinking process so that India can grow very fast in the future on the global stage.
How would enhanced capital expenditure impact our country?
A growth rate of 7 per cent has been estimated for the coming financial year which in itself is very positive as the whole world is expected to be in recession. After a long time, a great combination of economic growth and tax reforms is visible through this budget. Under the budget, a financial provision of ten crore rupees has been kept for capital investment for the coming year, which is 33% more than the previous year. These are commendable steps. Certainly, in the coming days, India’s economic development will be seen in leaps and bounds. Through the increase in capital expenditure, the government has made its stand very clear that the development of infrastructure, further upgrading of technology and digital platforms will be the top most priorities for the progress of the country. In the coming times, its direct impact will also be seen through increase in private investment.
What are the ways suggested to control fiscal deficit?
In this budget, the government has also expressed its vision of controlling the fiscal deficit and has taken a target of 5.9 percent for the next financial year. It will be more than 6 percent in compare to the current financial year. The main reasons being the economic side effects of the Covid – 19 pandemic, the global crisis from Russia and Ukraine and the weakening of the rupee against the dollar due to the interest policies of the American Fed.
The government has made a provision to control the fiscal deficit through financial discipline, as a result of which the government’s control over the expenditure in the budget is clearly visible. Far sightedness in economic policies towards capital expenditure has also been seen from the fact that emphasis has been laid on increasing capital expenditure even in the interest-free financial loans given to the states.
What does this budget hold for youth?
Under the budget, the youth power of India has also been given utmost care from a different point of view, On the one hand separate financial provisions have been made for making farmers agricultural entrepreneurs, while on the other hand, provision of training center has also been kept to skill youth for international opportunities. In this context, 100 laboratories related to 5G will be established in various universities under the budget, through which the objectives of creating different types of new jobs will be developed.
A glimpse of the inclusive development of the society through the advanced level of technology has also been seen in the budget, in which priority has been given to improvement in the areas of health, agriculture through artificial intelligence.
On this aspect, mutual coordination of industrial houses has also been included under the policies, which will definitely result in creating new jobs for the youth of India in the coming times. Under the budget, small and medium scale industries have also been kept in mind and provision has been made for a separate financial fund to make up for the economic losses incurred during the lockdown period during the corona pandemic.
Is there any tax relief for common man?
Yes there is a great relief for common man under this budget. Changes have been made in the structure of direct tax after a long time, which has given a huge relief to the common man. For example, a person earning a monthly income of Rs 25,000 is no longer in the income tax bracket, while a person earning a monthly income of Rs 50,000 will now have a tax saving of Rs 18,200.
Does this budget empower women and senior citizens?
The most positive aspect of this budget is that the scheme of financial savings has been started for the economic development of women, which is very commendable. Under this scheme, financial investment can be made for any woman or girl for a tenure of 2 years at a fixed interest rate of 7.5% with partial withdrawal option. The senior citizens of the society have also been attracted towards financial savings and their investment limit has been enhanced from ₹ 15 lacs to ₹ 30 lacs , which will prove to be a good financial planning for the family.
Inflation control …. Will remain a challenge!
Through in depth analysis, one side of this budget has also come out that it is futile to expect various economic exemptions or subsidies in the coming times after capital expenditure allocation. And hence, there will be no reduction in the prices of petrol, diesel and cooking gas in the future. Only a partial increase will be seen in the prices of MSP on farmers’ crops. The question is also arising that when the financial liquidity in the society will increase through tax reform, will it not increase the inflation because the government’s policy regarding control of inflation is not clear anywhere in the budget.
As a conclusion, in the context of this budget, it can be said that through the increase in capital expenditure, there will be a boom in the development of infrastructure and the common man will get financial benefit from the reduction in direct tax. Due to this, per capita purchasing power will increase in the time ahead and there will be new opportunities for economic investment. Overall, this budget has fulfilled the kind of economic reforms the country needed.