IT News
Imphal, July 25:
It is to be expected that the first budget of Modi 3.0 is a mixed bag because anything the ruling party does will always be viewed as insufficient by the opposition. The finance minister, Nirmala Sitharaman, made revisions to tax slabs and deductions to provide relief to different taxpayer segments. She also implemented various job creation schemes. However, a disgruntled section of the population dismissed the budget with a sour grapevine, claiming that every budget gives the rich a rebate and the poor a subsidy, while the middle class watches television and engages in debate. The opposition even went so far as to refer to the budget as “kursi bachao,” citing the fulfillment of decades-old and unfulfilled economic package demands from Andhra Pradesh and Bihar, respectively, in this budget. The truth, as I have consistently argued in the past and will continue to assert, lies halfway between two extremes. It is an all-inclusive budget that will meet the needs of the underprivileged, young people in rural and urban areas, farmers, India incorporated , people with special needs, women, and the budget that will contribute to the development of a massive, world-class infrastructure and self-reliance ecosystem in defense manufacturing and critical technologies that will eventually position Bharat as one of the world’s superpowers. The strong foundation required to achieve Vikshit Bharat by 2047 is anticipated to be strengthened by this budget.
It is my duty as the BJP’s karyakarta to reply suitably to the opposition’s irrational charges. To be clear and unequivocal, the budget is not a “kursi bachao.” To refute their assertion, allow me to cite the FM’s responses from the floor of the house. Members of the INDIA alliance failed to receive more than 230 votes, but the BJP by itself managed to secure 240 votes, and with the pre-election alliance, it was able to form government for a third term. For the third time, PM Modi is in charge of a free India. Now, something has occurred that has not in the previous sixty years. It would be wise for the parties discussing the rescue of Kursi or the PM’s chair to reconsider. Their coalition of nearly 37 parties was unable to secure even 230 seats, and they claim that he is acting in this way in order to keep his “Kursi.” The third time Mr. Modi took office as prime minister, he began “announcing” to the world about India, positioning us as leaders of the world and promoting development. This time around, the government has included Rs. 1.50 lakh crore in the budget for the States, which will be given to them for free over the next 50 years with no interest. The ministry knows this, but because it does not believe in taking credit, the finance commission did not bring it up. No State is to be overlooked. In response to TMC’s allegation, FM Sitharaman stated that the absence of their name in the budget does not result in any funding loss for the State. Maharashtra was not mentioned however the cabinet approved Rs.76,000 crore for the development of an all weather green field deep draft major port at Vadhavan in Maharashtra. She declared, “Every State will receive what they have proposed for, in accordance with the proposals, schemes, and various projects in different States.”
The critics’ assertion that there is nothing substantial for the middle class is irrational and unfounded. The salary class can now save up to Rs 17,500 in taxes under the new system since the government raised the Standard Deduction cap to Rs 75,000. Modifications were made to the tax slabs as well; individuals in the Rs 3-7 lakh income bracket now have to pay 5% in taxes. Tax payments of 10% and 15% of income are due from individuals earning between Rs 7-10 lakh and Rs 10-12 lakh. For the middle class, this is a relief. Approximately four crore salaried individuals and pensioners will benefit from it, and their disposable income will increase. Additionally, Sitharaman suggested doing away with the indexation benefit that is allowed to be deducted from any long-term capital gains on the purchase of real estate, gold, and other unlisted assets. It is proposed that the capital gains on these assets be subject to 12.5 percent capital tax rather than 20 percent.
Employment and skill development that is inclusive and serves all societal segments, including the middle class.
The problem India incorporated is facing is not about job creation it’s about finding skilled work forces that are employable. The issue is more about employability not much about lack of employment opportunities. For example the Tata group’s renowned software giant the TCS failed to fill 80,000 vacancies due to inability to find skilled employees. With more FDIs and establishment of more global MNCs in almost all sectors the need of the hour is to create an ecosystem to produce a massive pool of highly skilled work force to cater to domestic and global needs. To address this lingering issue the finance minister said that the government will implement 3 schemes for ‘Employment Linked Incentive’, as part of the Prime Minister’s package. These will be based on enrolment in the EPFO, and focus on recognition of first-time employees, and support to employees and employers. Scheme A: First Timers Direct benefit transfer of 1-month salary in 3 installments up to 15,000 to first-time employees registered in EPFO. Scheme B: Job Creation in Manufacturing
Incentive to be provided directly to both employee and employer as per their EPFO contribution, in the first 4 years of employment. Scheme C: Support to Employers. Reimbursement to employers up to 3,000 per month for 2 years towards their EPFO contribution for each additional employee.
In reference to the Skilling program, the Finance Minister announced the launch of a brand-new, centrally sponsored program for skilling in partnership with state and industry. This program is the fourth in the Prime Minister’s package. Over a five-year period, 20 lakh youth will receive skills, and 1,000 Industrial Training Institutes(ITIs) will be modernized with outcome-oriented hub-and-spoke arrangements.
Additionally, she declared that the Model Skill Loan Scheme will be updated to allow loans of up to Rs. 7.5 lakh with a guarantee from a Fund supported by the government, which should aid 25,000 students annually. She announced financial support for loans up to Rs. 10 lakh for higher education in domestic institutions in an effort to assist the youth who have not been eligible for any benefits under government schemes and policies. Each year, 1 lakh students will receive e-vouchers directly for this purpose, with an annual interest subvention of 3% of the loan amount.
Social justice and inclusive human resource development
Speaking about the Saturation approach, the Finance Minister emphasized that more will be done to implement programs like PM Vishwakarma, PM SVANidhi, National Livelihood Missions, and Stand-Up India that are intended to support the economic activities of craftsmen, artisans, self-help groups, scheduled caste, schedule tribe, and women entrepreneurs, as well as street vendors.
Purvodaya
Government will formulate a plan, Purvodaya, for the all-round development of the eastern region of the country covering Bihar, Jharkhand, West Bengal, Odisha and Andhra Pradesh. This will cover human resource development, infrastructure, and generation of economic opportunities to make the region an engine to attain Viksit Bharat.
Tribal people’s Pradhan Mantri Janjatiya Unnat Gram Abhiyan
The Finance Minister announced that the Pradhan Mantri Janjatiya Unnat Gram Abhiyan, which would benefit 5 crore tribal people by adopting saturation coverage for tribal families in villages with a tribal majority and aspirational districts that would cover 63,000 villages, would be implemented by the government in order to improve the socioeconomic status of tribal communities.
India Post Payment Bank plans to open more than 100 branches in the Northeast to increase the amount of banking services offered. According to her, Rs. 2.66 lakh crore has been set aside this year for rural infrastructure and development.
Manufacturing & Services
Support for promotion of MSMEs
According to Smt. Sitharaman, this budget gives manufacturing, especially labor-intensive manufacturing, and MSMEs particular attention. Guarantee coverage up to Rs. 100 crore will be given to each applicant by a separately established self-financing guarantee fund; however, the loan amount may be greater. Similar to this, public sector banks will increase their internal capacity to evaluate MSMEs for credit rather than depending on outside evaluation. She also disclosed a new system that will make it easier for MSMEs to continue receiving bank loans during a difficult time.
Mudra Loans
The upper limit of Mudra loans, which is currently Rs. 10 lakh, will be increased to Rs. 20 lakh for entrepreneurs who have previously taken out and effectively repaid loans under the ‘Tarun’ category.
MSME Units for Food Irradiation, Quality & Safety Testing
There will be financial assistance for the establishment of 50 multi-product food irradiation units in the MSME sector. It will also be facilitated to set up 100 NABL-accredited food safety and quality testing labs. E-Commerce Export Hubs will be established in a public-private partnership (PPP) model to allow MSMEs and traditional artisans to sell their goods in foreign markets.
Urban Development: Urban Housing
Under the PM Awas Yojana Urban 2.0, housing needs of 1 crore urban poor and middle-class families will be addressed with an investment of Rs. 10 lakh crore. This will include the central assistance of Rs. 2.2 lakh crore in the next 5 years.
Water Supply and Sanitation
In partnership with the State Governments and Multilateral Development Banks, government will promote water supply, sewage treatment and solid waste management projects and services for 100 large cities through bankable projects.
PM SVANidhi
She added that building on the success of PM SVANidhi Scheme in transforming the lives of street vendors, Government envisions a scheme to support each year, over the next five years, the development of 100 weekly ‘haats’ or street food hubs in select cities.
Energy Security
The Finance Minister said, in line with the announcement in the interim budget, PM Surya Ghar Muft Bijli Yojana has been launched to install rooftop solar plants to enable 1 crore households obtain free electricity up to 300 units every month. The scheme has generated remarkable response with more than 1.28 crore registrations and 14 lakh applications. Nuclear energy is expected to form a very significant part of the energy mix for Viksit Bharat.
Infrastructure
The Finance Minister underlined that significant investment the Central Government has made over the years in building and improving infrastructure has had a strong multiplier effect on the economy. Government will endeavour to maintain strong fiscal support for infrastructure over the next 5 years, in conjunction with imperatives of other priorities and fiscal consolidation. Rs. 11,11,111 crore for capital expenditure has been allocated this year, which is 3.4 per cent of our GDP.
Pradhan Mantri Gram SadakYojana (PMGSY)
The Finance Minister announced that Phase IV of PMGSY will be launched to provide all-weather connectivity to 25,000 rural habitations which have become eligible in view of their population increase.
Irrigation, flood mitigation and disaster relief
The government will fund projects with an estimated cost of Rs. 11,500 crore for irrigation and flood mitigation in Bihar through the Accelerated Irrigation Benefit Programme and other sources. These projects include the Kosi-Mechi intra-state link and 20 other ongoing and new schemes that include barrages, river pollution abatement, and irrigation projects. Additionally, the government will support landslide prevention, flood management, and related projects in Assam, Himachal Pradesh, Uttarakhand, and Sikkim.
Innovation, Research & Development
The Finance Minister said that government will operationalize the Anusandhan National Research Fund for basic research and prototype development and set up a mechanism for spurring private sector-driven research and innovation at commercial scale with a financing pool of ¹ 1 lakh crore in line with the announcement in the interim budget.
Space Economy
A Rs. 1,000 crore venture capital fund will be established in line with our ongoing goal of tripling the size of the space economy over the next ten years.
Next Generation Reforms
Economic Policy Framework
The Finance Minister said that the government will formulate an Economic Policy Framework to delineate the overarching approach to economic development and set the scope of the next generation of reforms for facilitating employment opportunities and sustaining high growth.
Labour related reforms
The government will make it easier for workers to access a variety of services, such as job and skill development. Such a one-stop shop will be made possible by the e-shram portal’s thorough integration with other portals. The Samadhan and Shram Suvidha portals will be redesigned to make trade and industry compliance easier.
To increase the amount of money available for climate adaptation and mitigation, the government will create a taxonomy for climate finance.
Foreign Direct Investment and Overseas Investment
In order to (1) facilitate foreign direct investments, (2) encourage prioritization, and (3) promote opportunities for using Indian Rupee as a currency for overseas investments, the rules and regulations pertaining to foreign direct investment and overseas investments will be streamlined.
NPS Vatsalya
NPS-Vatsalya, a scheme for guardians and parents to contribute on behalf of minors, will begin. It is simple to convert a plan member’s account back into a standard NPS account once they reach majority.
New Pension Scheme (NPS)
The Finance Minister stated that the Committee to Review the NPS has made significant headway in its work and that a solution that tackles the pertinent problems while upholding fiscal prudence to safeguard the general public will be developed.
Big boost for farmers
Union Finance Minister Nirmala Sitharaman said on Tuesday that the first Budget of the third Narendra Modi government included Rs. 1.52 lakh crore for farming and related sectors, reaffirming that increasing productivity and resilience in agriculture is her top priority. Ms. Sitharaman declared that the Center would restructure agriculture research to prioritize increasing productivity and creating varieties that can withstand climate change. “Farmers will be able to cultivate 109 new, high-yielding, and climate-resilient varieties of 32 field and horticulture crops,” the Minister declared. She continued by saying that one crore farmers nationwide will be introduced to natural farming over the course of the next two years, with branding and certification providing support. Large-scale vegetable production clusters will be established in close proximity to major consumption centers, while the production of pulses and oilseeds will be reinforced.
Ms. Sitharaman declared, “We will support cooperatives, start-ups, and Farmer-Producer Organizations (FPOs) for vegetable supply chains, including for collection, storage, and marketing.”
The introduction of Digital Public Infrastructure for Agriculture and the digital crop survey of 400 districts’ worth of kharif crops was another significant announcement. Additionally, the Center will contribute financially to the establishment of a network of Nucleus Breeding Centers via NABARD for shrimp broodstocks.
For impoverished people’s welfare The budget, according to Union Minister of Agriculture Shivraj Singh Chouhan, is for both national development and the welfare of the underprivileged. Rs. 1,22,528.77 crore is the total amount allotted to the Department of Agriculture and Farmers Welfare. The sum was Rs. 1,16,788.96 crore in the 2023–24 Revised Estimates for the previous fiscal year. A total of Rs. 500 crore was allotted for the Namo Drone Didi Scheme.
The PM Kisan Nidhi will receive the majority of the allocation. Amount allotted: Rs. 9,941.09 crore to the Department of Agricultural Research and Education. The revised budget for the previous fiscal year was Rs. 9,876.60 crore. A total of Rs. 7,137.68 crore has been allocated to the Ministry of Fisheries, Animal Husbandry, and Dairying. Rs. 5,614.93 crore was the amount in the most recent Revised Estimates.
With Rs. 2,13,019.75 crore less in its budget, the Department of Food and Public Distribution also experienced a reduction. The amount was Rs. 2,21,924.64 crore in the most recent Revised Estimates, but the actual spending in 2022–2023 was Rs. 2,83744.53 crore. The Price Stabilization Fund has been allocated Rs. 10,000 crore by the Budget to curb the escalating costs of necessities. The allocation in the previous Revised Estimates was a meager Rs. 10 lakh.
Landmark allocation’, will boost Atmanirbhar Bharat in defence manufacturing
Self-reliance is essential because no country can wage a protracted war by importing weaponry, as the ongoing conflict between Russia and Ukraine has made it clear to all of us.
The government set aside Rs 6.22 lakh crore as defence outlay for 2024-25. A total of Rs 1.72 lakh crore was allocated to the military for capital expenditure that largely includes purchasing new weapons, aircraft, warships and other military hardware. The allocation of Rs 1,05,518.43 crore for domestic capital procurement also means a major boost to the “Atmanirbhar Bharat” initiative, which promotes self-sufficiency in defense manufacturing and boosts defense exports. The iDEX programme, which will promote innovation and assist startups, MSMEs, and innovators in the defence sector, has been allocated Rs 518 crore. This will further the “Make in India” vision and align with the larger goal of “Viksit Bharat 2047,” positioning India as a global leader in defense technology and innovation. Our defense budget, according to critics, is insufficient to confront China, India’s rival. Still, India must use all of the resources at her disposal to develop our defense sector into a strong industry going forward, since other industries cannot be disregarded. Budgeting more for defense in tandem with economic expansion makes sense.
The main priority is to implement all defence projects in a time bound manner without citing excuses by the DPSUs and Private players through healthy competition, collaboration and focused approach to enhance national security, import substitution and defence exports. India is today one of the top 25 defence exporters of the world. We should make an all out effort to reach the top 10 by the end of this decade.
I have omitted several important sectors and areas from my assessment because the national budget is such a broad topic. Let me conclude by sharing a thread that a well-known handle posted on X, expressing his thoughts in his typical sardonic manner. One of the most inept FMs India has ever had, Nirmala Sitharaman quietly saved the country’s banking sector from total bankruptcy, made sure that everyone’s deposits were safe, and drove the market to all-time highs. She could have yelled from the roof, but she chose to ignore all of the insults directed at her. Numerous examples of her shortcomings support this assertion. Silently, she moved “Bharat” to the Fab-5 and “India” out of the Fragile-5. Her industry-friendly policies caused the stock market to soar to unthinkable heights and multiplied the wealth of investors. She made sure that funding for the development of infrastructure and defense capabilities was not lacking. Unlike any FM before her, she concentrated on employment generation. In April 2020 to the present, she even managed the money needed to feed 80 crore people. Her predecessor, Congressman Shri Chidambaram, operationalized “Phone Banking,” which she even completed without Congress legacy of loan sanction instantly (“Phata phat”) at one phone call from the echelon, favouring industrialists with bad loans. She achieved this by providing marginal relief to taxpayers despite the fact that direct tax revenue comes from a mere 1.6% of India’s total population. She managed debts at such a reasonable level that Bharat’s Debt GDP ratio is only 18.7%, despite the fact that only 2.9% of the population filed IT returns and that direct tax revenue was limited. Her bravery lay in eschewing populist policies in favor of inclusive development that included social welfare, employment creation, women’s empowerment, and Atmnirbhar Bharat. She worked to change Bharat’s status from a mere “Market” to a “Manufacturing & Logistics Hub.” Given her many shortcomings mentioned above, the opposition’s infamous ecosystem concludes that she is without a doubt the “Worst FM” in Indian history! To be acclaimed as the “Best FM,” she only needs to eliminate income taxes. Bharatiyas does not care about anything else.
