By the Editor
So the first budget of new government is out and as far as people’s response is concerned, it’s so far so good for prime minster, Narendra Modi and finance minister, Arun Jaitley. Despite unpopular price rise that were undertaken by the new government this budget came as a fresh wind of relief for the masses battling inflation and day by day growing cost of living. As far as our analysis goes for this budget, we are very much in the same boat like any other common man who doesn’t have any inkling about complex economics and finances but it doesn’t take much of a rocket science to understand that less tax, more savings equals fatter wallet.
The most applauded aspect of this fiscal year’s budget is the increase in tax exemption limit from 2 lakh to 2.5 lakh in Indian rupees. This will give a little breathing room in already tight finances of the service class, especially fellow young professionals in the IT industry who learns the drudging part of life in meager pay and long working hours. Home buyers are also happy about the tax deductions and seem positive about the declaration of home for everyone by 2022. But considering the rising prices of real estate market and continuously expanding suburban limits, this remains to be seen how this goal will be achieved given our growing problems about environment and pollution.
Another intention that’s very clear of the government is to increase investment in the country’s infrastructure and industry. It has two sides to it, obviously our current system needs overhauling and for that we need funds. Because of lack of vision and leadership our industries and government run entities have been severely lagging behind in efficiency and performance in recent years. Private funds would require more output and streamlining, which can bring these organizations back on track. It would be safe to assume that after increasing FDI limit to 49% in insurance, government would not stop there. Railway is also bracing itself for some outside help. Retail, defense and other sectors might soon follow suit in coming years because BJP has a clean majority and it’s free to act its vision without friction from allies or opposition parties. There is other side of this coin too, since private parties would be willing to take chances with the Indian government, they might want to push the envelope on not so profitable schemes that government runs for the poor and disenfranchised. One case can be of bank employee unions who might resist the merger, private influence and direct investment in government sector banks. How Modi government can maintain this balance and take everyone ahead will prove to be a tough road.
There are always some ups and downs in every budget and there would be varying opinions on its effectiveness but looking at an overall picture it has been received positively. People are hopeful that these plans would be acted upon in an efficient, transparent way that can lead us to a sustainable economic growth and prosperity.