Budget loud on agri-reforms, mute on economic revival

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It was a post-election Budget loud on agri-reforms, mute on economic revival and hence the expectations ran high that the Government after getting a brute majority and massive mandate would deliver on its promises. Hopes soared that the Budget for 2020-21 will deliver on reviving animal spirits by launching a surgical strike on GDP slump and job stagnation.

But the Budget loud on agri-reforms, mute on economic revival though not fully, has belied the hopes and doesn’t smack of measures that will resonate with potential investors or pull back the economy into full gear.

The trumpeting of 10 percent GDP growth of for 2020-21 sounds a pipedream since the nation has been doomed to sub-five percent growth in the last two quarters, the slowest in the past six years.

Another worrying concern is the perpetually shrinking pool of central taxes and in this year’s Budget loud, the amount is seen to be truncated by Rs 59,000 crore.

This downtrend in all certainty will bleed the states in a federal polity which depend on the Central government for financial props.

It is more so in the post-GST regime when some key states are floundering to augment their own tax revenues.

However, considering the positives, the Budget loud on agri-reforms, mute on economic revival, scores high on agriculture. Agricultural credit availability for this fiscal has been pegged at Rs 15 lakh crore.

The Budget loud on agri-reforms, mute on economic revival envisages a 16-point program for agriculture and allied sector reforms.

Notable among these goals are doubling farmers’ income by 2022, providing solar pumps to 20 million farmers and bringing all PM KISAN beneficiaries under the ambit of Kisan Credit Cards (KCC).

The Budget loud has proposed a balanced use of fertilizers to mitigate the influence of the incentive regime that laid undue thrust on the consumption of chemical fertilizers.

KISAN Rail and KISAN UDAN services have been mooted on the PPP (Public-Private Partnership) model to ensure the seamless movement of perishable agricultural goods.

Reaffirming focus on ‘Blue Economy’, Finance Minister Nirmala Sitharaman said fisheries production would be raised to 200 lakh tonne by 2023.

To give a fillip to the sector 3477 Sagar Mitras and 500 Fish Farmers Producers’ Organisation would be engaged.

In total, an outlay of Rs 2.83 lakh crore has been envisaged in the Budget loud for agriculture, irrigation, allied sectors, rural development, and Panchayati raj development.

The Budget touched on disruptive reforms for the education sector including plans to avail FDI (Foreign Direct Investment) and ECBs (External Commercial Borrowings) for ensuring quality higher education.

In an out-of-the-box idea, urban local bodies (ULBs) will offer internship opportunities to engineering students for mutual exchange of knowledge, translating into a win-win situation for both.

A degree level, full-fledged online programmed will also be commenced involving the top 100 educational institutions in the country.

The education sector has got a staggering allocation of Rs 99,300 crore of which a separate outlay of Rs 3000 crore has been done for skill development.

The Budget loud offered good tidings for income tax payees. Professionals with income up to Rs five lakh will be exempted from the tax net.

Likewise, the IT rate has been slashed from 15 percent to 10 percent for employees whose annual compensation is Rs 5-7.5 lakh.

The budget promised to protect the savings of depositors in scheduled commercial banks and enhancing the ceiling of insurance from Rs one lakh to Rs five lakh.

On Railways, the Finance Minister spoke of more Tejas trains to connect to iconic tourism destinations while remaining committed to developing the high-speed bullet train between Mumbai and Ahmedabad.

The Budget talked on corporatizing at least one major port with the subsequent listing on the stock exchange. Initial Public Offer (IPO) of Life Insurance Corporation of India (LIC) is also in the offing.