With much expectation and a great furore came in the Annual Union Budget 2016, promising to be the much-needed test for the Modi government. Everyone had their eyes set on Mr Jaitley as to what would come out of that suitcase for all the people at large. Now, there has been a dispersion in views regarding the budget, with Congress giving it thumbs down, arguing that this “Booster Budget” is a rhetoric thrown to the previous UPA policies and it paints a very generalised picture of the country, amid the general stagnancy and the agrarian defaults that the country is facing.
While many others argue that the budget is balanced to the nation’s development priorities, with paramount importance given to the infrastructure sector and pumping primarily the rural economy which lies in shatters.
With such a diverse views and opinions, I am here to do nothing atypical, but give my own pointers on Mr.Jaitley’s Third Budget:
HALF GLASS FULL SIDE
- Rs 38,500 crores given to MNREGA (highest ever allocation) along with Rs 9,500 crores being allocated to Modi’s Swacch Bharat Abhiyan.
- Rs 25000 crore towards recapitalisation of Public Sector banks. This is a welcome step towards capital restructuring of banks given the huge NPA problems that they are facing.
- The target of disbursement under MUDRA has also been lifted up to 18,000 crores.
- An additional exemption of Rs. 50000 given to Housing Loans up to Rs 35 lakh ( provided cost of the house is not above Rs 50 lakh) to promote new house dwellings
- Senior citizens to get an additional healthcare cover of Rs 30,000 under the New Healthcare scheme.
- 1500 Multi-skill development centres to be made world-class to impart training to 76 lakh youth under the allocated budgetary amount of Rs 1700 crores
- Major emphasis on Sinchayi or Irrigation as a dedicated fund of Rs 20,000 crore goes into NABARD.
HALF GLASS EMPTY SIDE
- There have been no changes in Income tax slabs and taxing the super rich on a 15% surcharge won’t be of much help with regard to compliance.
- Infrastructure and agriculture cess to be levied along with a 0.5 percent Krishi Kalyan cess on all services
- 60% of the EPFs withdrawn are taxable leaving just 40% untaxed portion which hampers the savings of the new employees.
- 3 lakh renal patients adding every year to the list still acts as a major barrier. No measures have been taken for them.
- No clarity regarding Minimum Support Price (MSP) of various agricultural crops.
All in all, I would raise this budget as a fairly average one as some more transformational measures could have been a part of the budgetary policy and control. More emphasis on the Tax regime should have been factored in. However, thumbs up for agrarian reforms and social sector reforms are the few pros that I could find in the Budget.