View from India: Budget outlines seven priorities for the next financial year
Union Finance Minister (FM) Nirmala Sitharaman presented the Union Budget 2023-2024 on 1 February. Prime Minister Narendra Modi, who heads the Union Cabinet, has approved of the Budget for the fiscal 2023-2024.
Seven is believed to be a lucky number, and the FM has announced that the Budget will focus on seven areas for growth. These include inclusive development, reaching last mile, infrastructure and investment, unleashing potential, green growth, youth power, and the financial sector. The Finance Minister described the seven priorities as the “Saptrishis (seven sages) guiding us through Amrit Kaal”.
Sitharaman has indicated that the Indian economy has increased in size. It has moved from being the 10th to the fifth largest in the world in the last nine years. “In the 75th year of Independence, the world has recognised India as a bright star. Our growth for the current year is estimated at 7 per cent. This is the highest among all major economies, in spite of massive global slowdown caused by the pandemic and the war,” said Sitharaman, who said Budget 2023 is the “first Budget of Amrit Kaal and the blueprint for India @100”.
By way of explanation, Amrit Kaal is a term that Modi came up with during the 75th Independence Day celebrations. PM used the term as he laid out a new roadmap for India for the next 25 years. The Budget’s vision for the Amrit Kaal includes a technology-driven and knowledge-based economy, with strong public finances and a robust financial sector. Clearly it calls for culminated efforts. It’s a jan bhagidari, or people’s partnership, that can be achieved through sabka saath, or everyone’s support, and sabka prayaas, or everyone’s efforts.
The Budget has thrown light on the capital investment outlay, which has been increased by 33 per cent to ₹10 lakh crore (10tn rupees, or £99bn). This will account for 3.3 per cent of the GDP. To boost the economy, the FM said that the 50-year interest-free loan to state governments will continue for another year. A recent news item has indicated growth indicators in the economy. Satellite imagery of the Earth during the night, which we know as Night Time Light (NTL), reflects human activity and natural events, which is an economic indicator of the region’s prosperity. The Indian Space Research Organisation's National Remote Sensing Centre has released the the 'NTL Atlas', or 'Decadal Change of NTL over India from Space (2012-2021)', which reveals that overall at the national level, the normalised NTL radiance has increased by 43 per cent in 2021 compared to that of 2012.
The Economic Survey for 2022-23 was released just prior to the Budget; the Survey has projected the Indian economy to grow 6-6.8 per cent in 2023-24. Job creation should be put on a fast track in the country. This may happen with private capex (capital expenditure) assuming a 'leadership role'. Sitharaman announced that the country is moving towards the pre-pandemic growth path, and India’s recovery from the pandemic could result in investment opportunities. The FM has tabled the latest edition of the Economic Survey in Lok Sabha, which is constitutionally the House of the People. This is the lower house of India's bicameral Parliament; with the upper house being the Rajya Sabha.
India holds the Presidency of the recent G20 initiative, or Group of 20 nations, for 2023. The intent is to bridge the digital divide and tackle the challenges of food and energy security. “G20 Presidency gives us a unique opportunity to strengthen our role in the world economic order, we are steering an ambitious people-centric agenda to address global challenges and facilitate sustainable economic development,” added Sitharaman.
Narendra Modi became Prime Minister in 2014 and was elected once more in 2019. During his first term as PM, Modi launched the Make in India campaign, a move to promote domestic manufacturing and open up avenues for employment. The intent has been to Make in India and Make for the World. This is being addressed through initiatives such as the Production Linked Incentive (PLI) scheme. As of now, the PLI scheme is available for 14 sectors including renewable energy, auto, telecom and mobile phones.
Modi, during his first and second term as PM, has also focused on ramping up rail and road infrastructure. Basics such as food supply have also been a top priority during the pandemic outbreak. The concern continues, as the Budget endorses a people-centric agenda to take on global challenges. The government has set out on a scheme to supply food grains from 1 January 2023 to all Antyodaya (uplifting of the weakest section of the society) and priority households for the next year. Now that’s food for thought.
Sign up to the E&T News e-mail to get great stories like this delivered to your inbox every day.