NEW DELHI: If one had to rank the Budget presented by the Finance Minister on Wednesday, 8 out of 10 might be a probable option. The focus is on developing major infrastructural projects and therefore entails massive increase in the proposed capital expenditure. The allotment of Rs 10 lakh crore plus is a huge jump from the previous year’s budget. This is a good sign for any economy, as sustainable income will come only from capital projects. Better infrastructure would create a better environment for business to flourish and provide large employment opportunities.

The highest ever capital outlay of Rs 2.4 lakh crore for railways would mean more routes, more trains, particularly the Prime Minister’s pet project ‘Vande Bharat’ trains and better facilities to passengers. However, one would expect an increase in fares to recover, if not fully, at least partially, such a huge capital outlay.

The focus on circular economy is evident and that shows this government’s commitment in putting in place the best ESG (Environment, Social, Governance) practices. Allotment of Rs 35,000 crore for priority capital investment in the green energy transition, ‘Atmanirbhar Clean Plant Programme’ to improve availability of disease-free, quality planting material for high-value horticultural crops at an outlay of Rs 2,200 crore and focus on green farming could boost accrual of carbon credits.

The intention of the government seems to be increasing the income of the farmers as promised in its election manifesto. Provisions have been made in the budget to encourage agri start-ups and digital public infrastructure for agriculture to be built as an open source, open standard and interoperable.

This will help farmer-centric solutions besides improving access to farm inputs, market intel, and support for the agriculture industry. Promoting production of millets would assist farmers in a big way as raising such crops would require less water compared to water-intensive crops production of wheat and rice. Farmers working in dry lands would be immensely benefited as well.

The proposal to create several warehouses dedicated for storing agricultural produce is another step towards increasing the income of the farmers, as farmers can store their materials and sell them at an appropriate time when they get a better price.

On the personal Income Tax front, relief has been provided to the middle class and that would free up money in their hands for spending or saving. However, for the affluent sections, the surcharge rate on income above Rs 5 crore has been reduced from 37% to 25%. At this stage, the government could have continued with the old rate at least for a year.

The middle class would have been happier with a reduction in excise duty on petroleum products particularly when India is able to procure fuel relatively at a better price from Russia, instead of slab rate changes.

This is because the relief given in Income Tax would apply only to taxpayers, whereas reduction in fuel cost would benefit all including the business community and possibly contribute towards more production and consumption.

It is heartening to see that production of mobile handsets in India has been increasing year on year creating huge job opportunities for the youth. However, more handsets would mean more e-waste which is contrary to the green initiatives taken by this government.

On the ease of doing business, the finance minister announced that nearly 39,000 compliances have been done away with and many actions have been decriminalised. This is definitely a welcome move and should help India to improve their rankings in ease of doing business.

Lot of attention has been given to education and skilling. Revamped teacher training via District Institutes of Education and Training is a step towards improving the skill. The National Digital Library for children and adolescence covering diverse subjects in diverse languages is another welcome move to increase the knowledge and skill base of the youth of this country.

On healthcare, this government has done a good job during the COVID-19 period. Realising the importance of healthcare, the proposal to have 157 new nursing colleges, programmes to promote research in pharmaceuticals to become Atma Nirbhar (self-reliant) are steps in the right direction. India is not far away from becoming a global pharma powerhouse similar to its prowess in Information Technology.

This is a job-oriented budget which sharply strengthens the domestic manufacturing while focussing on MSME. The budget also trains its gaze on a technology-driven economy to boost tourism, artificial intelligence-based initiatives, all of which will prepare India to face future challenges. A balance has been struck between development goals and taking care of the rural sector.

The fiscal deficit of 6.4 per cent may be worrisome but still commendable considering the gloom prevailing in the global economy. One area of concern could be the spend on defence. Budget on defence has only gone up marginally, which in our view, has to be more considering the threat from China. However, this government has taken all the steps to protect the integrity and the borders of this country and would have deliberated well to put this number as defence budget.

Another area of concern is the drastic reduction of fertiliser and food subsidy by 22% and 31% respectively. This would further exert pressure on cash flows of fertiliser manufacturers who are struggling financially as there are outstanding subsidies to be received from the government.

Last but not the least water conservation, including rain harvesting, creating new tanks, restoring existing rivers to glory are some of the areas where the government could have allocated substantial funds in the budget.

— JC Laddha, MD, DAA Consulting served as MD, Century Textiles & Industry Ltd. Prior to this, he held several leadership positions in the Aditya Birla Group reigning over various businesses of the Group

— D Arvind is Managing Partner of D Arvind and Associates LLP, Chartered Accountants. Prior to this, he was a partner in the Big Four Firms handling Indirect Tax Practice. He is a practising CA, in India and the UK

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