At the same time, the Finance Minister has made a remarkable effort to stick to fiscal prudence and has indicated a glide path to <4.5% by FY25/26 for the comfort of the markets. By achieving fiscal deficit for FY23 at 6.4% of GDP and borrowing from the market With a fiscal deficit estimate of 5.9% for FY24 at ₹15.43 trillion, the budget has addressed one of the major concerns.
The vision to develop both India and India through seven distinct focus areas – the Saptarishi model – is progressive and pragmatic and strategically focused on infrastructure investment, green growth, agricultural development and modernisation, youth skill enhancement, financial literacy and tourism. focuses on.
As expected, the highlight of the budget was the record capital expenditure allocation 10 trillion which will act as an economic multiplier in sectors such as transport and housing. There was a holistic approach to capital expenditure, with a balanced allocation to develop railways, roads, urban infrastructure and power, which are largely dependent on public resources.
But by setting up the Infrastructure Finance Secretariat to assist all stakeholders with greater private investment in infrastructure, the government has actively encouraged the PPP model, inviting the private sector to take the lead. With Railways getting highest ever capital expenditure allocation 2.4 trillion in FY24, India seeks to improve last-mile connectivity. With over 50 airports and aerodromes and renovation of existing aviation facilities, the Vikas Rath has been unleashed.
Rs 10,000 crore Urban Infrastructure Development Fund – through priority sector debt reduction – another milestone that will transform the urban planning landscape, empowering cities through efficient use of land, adequate resources and transit-oriented development Will make it more durable. When it comes to creating infrastructure assets, the budget has also put the onus on the states to use, create and perform.
By simplifying direct taxes and making them taxpayer friendly, the budget also gives a boost to urban consumption. While the Finance Minister increased the exemption limit from 7 lakhs 5 lakh, no section of taxpayer has been left out in the overhaul. Even the surcharge to the highest tax rate of 42.73% has been revised from 37% to 25% with a maximum of 39%. Although the revenue foregone is close to 35,000 crore, the finance minister is counting on to boost overall consumption. Importantly, no change to the capital gains tax regime had a huge impact on the convenience of the markets.
Focus areas like green growth and tourism development are going to generate employment as well as attract investment. As per the Prime Minister’s vision, India is moving strongly towards ‘Panchamrit’ and net-zero carbon emissions by 2070 which will ensure ‘Green Growth’. As one can see it, the theme of green growth will now pervade all economic activity, helping India achieve its global promise of net zero and carbon reduction. This will also create employment and entrepreneurship opportunities.
The budget has been successful on all fronts as several announcements have been made for women, senior citizens and tribals while maintaining the inclusiveness aspect. It has created a viable platform for technology even in traditional sectors like agriculture, leaving enough in the hands of consumers, working hard to leverage internal strengths like tourism, and large-scale domestic capacity building and green focus. Have tracked the global leader with.
This will definitely take India on the path of becoming an economic superpower in the next decade.
The vision to create food and fuel security is clear; For example, the recently launched National Green Hydrogen Mission, with an outlay of 19,700 crore, will drive India’s transition to low carbon intensity, reduce dependence on fossil fuel imports, and lead the country as a technology and market leader. This budget has provided 35,000 crore for priority capital investment towards energy transition and net zero objectives, and energy security. The budget has, happily, gone a step further to encourage a behavioral change by setting up a Green Credit Program that will encourage environmentally sustainable and responsible actions by companies, individuals and local bodies.
Though India is a much hyped country for tourists, rarely do we see an attempt to promote India’s natural gifts. This budget has taken a deep dive with ideas and resources to make India a destination for domestic and international tourists. To promote tourism through PPP model to generate large scale employment opportunities will be worked on mission mode with states and under convergence of government programmes.
Budget 30 Skills India continues to focus on youth as ‘Amrit Peeth’ to realize their dreams with new projects and programs by setting up International Centres. It envisions a progressive approach in skill development by focusing on new age courses for Industry 4.0 such as Coding, AI, Robotics, Mechatronics, IoT, 3D Printing, Drones and Soft Skills.
The budget has been successful on all fronts as several announcements have been made for women, senior citizens and tribals while maintaining the inclusiveness aspect. It has created a viable platform for technology even in traditional sectors like agriculture, leaving enough in the hands of consumers, working hard to leverage internal strengths like tourism, and large-scale domestic capacity building and green focus. Have tracked the global leader with.
This will definitely take India on the path of becoming an economic superpower in the next decade.
(Contribution by Shanti Ekambaram is whole-time director of Kotak Mahindra Bank.)
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