Herald: Not a clear roadmap for the economy

Not a clear roadmap for the economy

06 Jul 2019 04:58am IST

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Presenting a Budget where she has not increased direct taxes on the middle class, Union Finance Mini

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06 Jul 2019 04:58am IST

Report by
Presenting a Budget where she has not increased direct taxes on the middle class, Union Finance Mini

The first Budget of the Modi 2.0 Government has effectively – with the hike in fuel prices – increased prices of commodities across the board and pinched the pockets of the people. The middle class of course was not happy and the messages posted on social media clearly underlined this. For the middle class the wait for achhe din could just have got longer.

Praised by the Bharatiya Janata Party as a Budget for a ‘new India’ laying the foundation for an inclusive and progressive nation, it has been panned by the Opposition Congress as ‘old wine in a new bottle’, bereft of any initiatives to strengthen the economy. The opposition may have a valid point for in reality the government announced whatever it had to in February this year, in the interim Budget presented by Piyush Goyal prior to the elections, and left out major announcements from Friday’s Budget speech. There is nothing that can be considered as path breaking in Sitharaman’s maiden Budget speech. 

Do look at this, Defence has not been given any specific attention in the Budget, except for the removal of customs duties on equipment. Now, with the increased threat perception and after the Balakot strike of February last, it was expected that there would be some specific statements and provisions for the armed forces, but this has not happened. On the other hand, the Finance Minister focussed on other areas and announced that the country will soon have a new education policy, and that there will be a comprehensive reform in higher education, with renewed efforts to promote research. While these are welcome statements, we will have to wait for the policy document to be able to comment upon them.

In some good news to Goans, Sitharaman announced that rental laws will be reformed to promote house renting. Given that there are thousands of apartments in the State that remain locked, this would serve to give the owners of these flats the opportunity to lease their premises if the law protects them from the leasee, as currently the relationship between the tenant and the landlord is not adequately addressed. There’s more for Goa, as the Budget has proposed that customs duty on import of cashew kernels be increased to 70 per cent from the current 45 per cent, as had been demanded by the industry. This is ostensibly to support the local cashew growers, who had suffered losses as the price for cashew nuts in the country had dropped due to rising imports. 

But there is more in the Budget that needs to be focussed upon and which will be crucial for the country’s economy in the coming years. There have been fears that the economy is facing a downslide. The measures to address this do not appear to have made their way into the Budget. A day earlier the Economic Survey had focused on development and growth, but there appears little that the Budget has to support this. Job creation itself appears to have been left out, and this is one area that people across the country – of all ages – are concerned about. Unemployment hasunmade governments, and India is seriously facing a job crunch that needed to be handled immediately. 

Though the local business community has welcomed the financial proposals, achieving the projected growth through this Budget, at this point of time, appears to be a tricky task. There are lot of aspirations, but the roadmap towards achieving this is not clear.
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