The Union Budget is an important announcement by the central government as it is an overview of the government’s goal for the coming year. The budget gives a report on economic performance of the country in the previous year and the aims for the upcoming year. The government announces policies for different segments of the economy such as infrastructure, manufacturing, taxes as well as financial statements of the government.
1. Important Dates
Jan 31, discussion commences in Parliament.
Feb 1, Finance Minister Presents Budget.
Apr 6, parliamentary discussion ends.
2. Middle Class – No additional Tax
The finance minister has said to ANI that, “I belong to middle class and identify myself as middle class so I can understand them. She stated that no new tax will be levied on middle class by the government and that the government will continue to “work for the middle class”.
3. ‘Economic Survey’ – Results Expected
The economic survey is the review of the developments in the Indian Economy over the previous financial year, summarizing the impact of the major development schemes and the prospective policies of the government for the short term. The economic survey is expected to be presented on Jan 31.
Expectations -
4. Revision of Tax Slabs –
The tax payers always are on the lookout for the tax policies. There are expectations that there would be revision in the tax slab rates which could be a big difference for people nearing the higher tax slabs.
5. Production Linked Incentive (PLI) Schemes –
As the nation aims to increase manufacturing within the country for domestic consumption as well as exports in an aim to grow the economy. Many Small and Medium Enterprises and Startups especially in advanced tech such as semi-conductor manufacturing, satellite parts, aeronautics, drone tech as well textile, electric mobility, clean energy and under industries look forward to PLI schemes which will determine the decision of manufacturing.
6. Manufacturing –
Manufacturing sector looks out for subsidies from the government to incentivize the industry. The relief could be in form tax breaks, lower taxes, tax exemptions, export tax reduction and the likes. As the country aims at reaching higher economic levels, a robust manufacturing sector is vital in achieving the economic goals as well as an employment creator in the country.
7. Rural Growth –
Statistical Agencies estimate that 46% of national income is from rural areas and two-thirds of the workforce lives there. The government is expected to prioritize spending in the development of infrastructure in Rural areas with a long-term perspective of growth. UBS Economist Tanvee Gupta Jain has forecasted an estimated $10 billion expenditure on agriculture and rural growth as per report by India today.
8. Clean Energy –
India aims to meet the climate change agreements at the Global Level. The G20 presidency is also giving importance to tackling climate change and energy is one of the biggest polluters. The government is expected to announce mandates for the adoption of cleaner fuels, green hydrogen, renewable electricity.
9. Stock Market –
The financial plan of the government and its proposed policies have an impact on the stock market. The Infrastructure and Manufacturing industries are in anticipation of the budget announcement. Increased volatility can be observed in the stocks having a link to the budget such Infrastructure and Manufacturing.
10. Social and Economic Policy –
The budget not only highlights the financial aspects, but also the government’s stance on social and welfare as the budget also includes the government’s policy towards public healthcare, public education and the general welfare of its citizens.
The budget has an impact on the economy of the nation and hence is anticipated by all sections of the society. Amid the worries of recession at a global level, the budget will be a guide navigating the country in turbulent times. As India plans to become the 3rd largest economy in the world which will mean increased expenditure on infrastructure and development. With the general elections just a year away, this budget is an important announcement by the government.
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