impact of interim budget 2019 on various sectors of Indian economy??
Answers
Farm sector
Measures:
Inclusion of animal husbandry and fisheries in Kisan Credit Card (KCC) scheme and availing of interest subvention
Impact:
Inclusion of allied sector farmers
Concerns:
Land remains collateral
Hypothecating livestock and fisheries will have issues for asset identification, tagging and recovery
Measures:
Pradhan Mantri Kisan Samman Nidhi (PMKSN) Scheme
Impact: Direct benefit transfer to small and marginal farmers
Concerns:
Landless labour left out
Land record reconciliation
Land record not fully digitised
Increasing fragmentation of land
Social sector
Measures:
Stagnant allocation of Rs 60,000 crore for MGNREGA
Impact: Lower achievement of targeted person-days
Concerns: The outlay has to be hiked during the year or the target person-days has to be reduced
Measures:
Increased allocation to Ayushman Bharat
Impact: Increase in beneficiaries
Concerns:
Adequacy of Budget outlay in the event of accelerated enrolment
Timely payments to hospitals
Measures:
Pradhan Mantri Shramyogi Man Dhan Yojana
Impact:
Widening the ambit of social security net for unorganised marginal wagers
Concerns:
How the discontinuity in payments is treated
Low interest amongst workers due to large premium paying duration
Measures:
National Programme on Artificial Intelligence
Impact: Greater preparedness to address disruptions by technology
Concerns: Scale of investment and capability dictate that it should be done in partnership with private partners . Measures:
Increased allocation to National Education Mission
Impact: Improvement in the quality of education
Concerns: While school education seems to have received adequate outlays, there is no clarity on the much-needed reforms in higher education
In the previous two budgets, the intent to drive rural demand was apparent. Today as well, there were announcements providing monetary support to farmers, with assured income support benefitting 12 crore families.
For micro, small & medium enterprises (MSMEs), which are critical, large-scale growth engines of the economy, the interest subvention scheme is expected to help drive capex and generate employment in the unorganised sector.
This budget has also laid much needed focus on realty, underpinning government commitment towards housing for public and providing tax exemptions to developers, Hopefully, these initiatives will help improve end-user demand towards real estate, bringing relief to developers amid the current demand and liquidity slowdown.
A positive stimulus for real estate will aid financial institutions since they serve as a large source of funding to the sector, and also help in employment generation.
In line with the increasing tax collection, the minister has offered an impressive tax rebate for individuals having income of up to Rs 5 lakh. Other initiatives have also brought taxpayers cheer. Separately, the minister’s aim to announce certain measures to improve efficiency within the Income Tax Department is likely to go a long way in improving tax compliance. The government has clearly delivered on its goal of reducing the tax burden. The improving health of the banking sector was highlighted, considering recapitalisation of Rs 2.6 lakh crore.
The budget also underlined the achievement in containing inflation at 4.6% despite overall growth. Though India is solidly on track of development, given the progressive reforms and GDP growth, we still saw a slip in the fiscal deficit target for FY19, having increased to 3.4% from 3.3%. That said, the markets have so far taken the announcement in their stride and continue to bat solidly.
Overall, I would rate this as a good interim budget, a much-needed step in the right direction. And amen to the concluding remarks of India becoming a $5-trillion economy in five years and $10-trillion economy in the next eight years