Finance minister Nirmala Sitharaman on Monday said the government wants a sustained recovery and budget proposals on infrastructure building are an attempt to create a multiplier effect to help the economy.Speaking at a post-budget interaction with the industry in Mumbai, Sitharaman said the budget had been prepared at a time when the economy was emerging from the pandemic.“A sustained recovery is what we would want.The budget has growth revival along with messages for sustainability as a priority,” she said.Focus on infra and employment The government is targeting to spend about Rs 5.5 lakh crore on infrastructure and can go as high as Rs 7.5 lakh crore.This, in addition to improving infrastructure in the country, will create thousands of jobs in road development, sea ports, inland waterways, etc.
The production-linked incentive (PLI) scheme extended to 14 sectors will encourage manufacturing in the country and increase manufacturing-related jobs.The government estimates that 60 lakh jobs will be created with the help of the PLI scheme.The government has extended ECLGS (extended credit line guarantee scheme) of Rs 60,000 crore to the hospitality sector to help it revive from the pandemic.Apart from ECLGS, the government has earmarked Rs 2 lakh crore for MSMEs (micro, small and medium enterprises).
The outlay for Pradhan Mantri Gram Sadak Yojna has been increased and to ensure that the project goes as planned the government is willing to take the state’s share of 40 percent.Atma Nirbhar Bharat is another step which has helped protect and generate employment during the pandemic and the outcome of the economic survey proves that, the finance minister said.Support to farmers Commenting on the support given to farmers, the finance minister said that the government has increased the minimum support price (MSP) and has achieved record procurement which will ensure improvement in the farmer’s income this year.The subsidy for urea and micro-nutrients has been increased, which has reduced the burden on farmers from increased prices in the open market.
The government is giving solar pumps to farmers for irrigation and the excess power generated will be supplied to the grid which will add to farm income.A total of Rs 16.5 lakh crore was earmarked for agriculture credit, of which 75 percent has been achieved; the government aims to increase this credit to Rs 18 lakh crore next year.
Inflation The finance minister expects inflation to remain in the region of 6 percent and said that the government is taking all steps necessary to contain inflation.She cited the instance of palm oil imports for which the import duty was reduced in order to encourage imports and keep the prices in check.
The minister said that the government is willing to take more such steps to meet the demand for commodities and keep their prices under control.Taxation on crypto currency The finance minister highlighted that “a currency is a currency only if it is issued by the central bank”.
She said the RBI (Reserve Bank of India) will be issuing a digital currency for which the nuances are being worked out.She was of the opinion that anything outside of the currency issued by the central bank are assets being created by individuals which need to be taxed.Hence, transactions in crypto currency will be taxed for which the government has circulated a paper and is receiving inputs from parties and experts.The quantum of taxation will be finalised based on the inputs received.Support for technology Stating that technology has helped the government make payments to the affected people during the pandemic, Sitharaman said it is also looking at how digital solutions can be deployed in education and farming sectors.
The government wants to push innovation and the support to startups will continue, Sitharaman added.The ease of funding through private equity and venture capital is one of the main reasons that India has seen growth of many unicorns in the past few years.The government has appointed a committee to devise a road map for easing private equity investment which will improve the ease of doing business index.
Personal income tax regime Asked about expectations of revision in tax slabs for the salaried class, Sitharaman said, “There are times when things can be implemented sooner and there are times when things need longer time to be implemented so tax relief may come later.” She added that the government has not put any additional burden on the salaried class by keeping the tax rates unchanged for the past two years..
