Budget 2017 - How it will shape India's economy - Comment
Budget 2017 - How it will shape India's economy
In order to retain the economic fabric of the country, budget is very important. Budget is the annual financial statement of a country. It has the constitutional frame work under article 112.
Every year the union budget is presented in March, but 2017 is different from the preceding years. This year it has been presented in the month of February.
Employment generation: Employment generation is one of the key factors for an economy. MGNREGS is one of the most discussed points in this regard. Starting from 2005 it gives hundred (100) days' work assurance to every valid job card holder. This year the Government allocates Rs. 48000 crore for the scheme as compared to last financial year (2016-17) which was nearly 47500 crore. The Government decides to geographically tag all MGNREGS assets to bring more transparency in the scheme. The NRSC and ISRO has made a web based application names 'Bhuvan' for the same which will effectively monitor the scheme.
Boot to SME's: Now if we look at the micro small and medium enterprises the Government has also made very effective and prudent steps. A huge portion of the national income derives from this sector. In order to boost the sector more viable the companies with annual turnover up to 50 crore, the income tax has been reduced to 25% as compared to earlier to 30%. All these will help the sector to blossom with more prosperity.
Agriculture: From the early history of human civilization till now onwards agriculture plays a pivotal role in the economy. Agriculture had also been prime moving force of the economy. Big portions of India's GDP come from this sector. This year the Government allocates Rs .51026 crore for this sector income generating sector which is nearly 6% higher than the last year allotment. Targeted plan for agricultural credit has been fixed to rs. 10 lakh crore . The Pradhan Mantri Fasal Bima Yojna PMFBY which is a land mark progress in the sector for the farmers to save the farmers from any distress in post cultivation period. The Government allocates rs.5500 crore last February for the same and now allocated Rs. 13240 crore to settle area claims. The PMFBY will now cover 40% of the cropped area which was earlier 30%. The Government also increase corpus of dedicated irrigation fund by Nabard from Rs. 20000 crore to Rs. 40000 crore.
Push for cashless economy: Government's constant effort in transforming India from a cash dependent economy to a less cash economy and digital economy also get an important role in the budget. Cash transaction has been capped up to Rs. three lakh for a single transaction. Any high value transaction over three lakh will be under government's radar. The penalty is also equal to the amount received. This move will clearly bring transparency to the economy. We have witnessed parallel economy in our country and with such move tis will be reduced to some extent.
New FDI Policy: In respect of Foreign Direct Investment the government has decided to abolish Foreign Investment Promotion Board. This board was formed as a beacon of liberalization of 1993 under former PM P.V. Narasimha Rao's government. It acts as a single window clearance for applications for prospective foreign investors in sectors falling in the approval route but now the Government decided to run FDI under automatic route which does not require approval.
In sum this budget will boost up the economy from its core. Digitalization in every sector will definitely bring more transparency and Government's positive approach will definitely bring for the outcome of the economy. There is definitely some dearth of money but what we have should be judiciously spent so that our country be more advanced and no one can put a finger.
- Rohan Sengupta