By – Ramesh Chandra Lahoti
The union budget 2024-25 has been described by some as “bland” but sometimes bland is not bad! Status quo in tax is a relief for businesses who have a fear of tax hikes in a budget.
Be that as it may, the big picture of the budget is the reining in of fiscal deficit at 5.1% of GDP, rise of average real income by 50%, solar power relief and schemes for encouraging sunrise sector.
The expectation of 7% growth in the coming years provides a massive fillip to the confidence of industry & trade, while the rooftop solarisation scheme that will provide 300 units free power and help households save nearly Rs 18000 per year is a bonus.
Given the limited nature of the interim budget, the finance minister has predictably prioritized capex spending, particularly in sectors like railways, and defense.
The budget has recognized the need to encourage the farm sector to increase its productivity but more should have been done as it is critical to India’s overall growth. The focus on increased allocation for enhancing storage infrastructure in this sector is welcome, but the budget should have also included specific provision for improving the infrastructure in APMCs.
The proposal to introduce five major economic railway corridors, viz. energy, mineral and cement corridors, port connectivity corridors, and high traffic density corridors to improve logistics efficiency and cost, is a need of the hour for industry & trade, in particular.
Women empowerment has been given a massive boost through 30 crore Mudra loans to women entrepreneurs and this should be aggressively continued, so as to enhance the proportion of women business owners.
Skilling of 1.4 crore under Skill India Mission is a milestone that should be taken to the next level by taking more such initiatives involving industry bodies at the State-level.
The formalization of the economy has been emphasised but the FM could have gone beyond intentions by doing more to integrate India’s vast informal economy into the formal economy, through measures such as streamlining regulations, simplifying tax structures, and incentivising formalisation, and at the same time, shunning the temptation to pile on excessive compliance burdens on small businesses.
For senior taxpayers who have been facing the brunt of litigation, the budget has taken a significant step to benefit nearly one crore taxpayers, freeing them from tax demands for a prescribed amount and period.
The budget has also missed a great opportunity to boost the retail sector by reducing GST for retail products.
Ramesh Chandra Lahoti, President, FKCCI
