Saptarishi and Budget’s proposals
The budget’s ‘Saptarishi’ and government’s intent to spend more on capital account may help the economy. As past performance of government announcements have shown positive results, hopes for budget promises are more. — Anil Javalekar
Indian budgets are now more for future than for the present. Last budget for 2022-23 talked about ‘Gatishakti’ and ‘monetisation’ of public assets. Current budget is talking of ‘Saptarishi’- seven priorities- so to guide the Amrit Kaal Indian economic development. By listening or reading the budget speech, one feels happy to see that finance minister has so much for India’s future development. However, till the speech reaches to personal tax part, one fails to understand what FM is proposing to solve the current problems of Indian economy. At the end of budget speech, it can safely be said that the budget has more for future and less for current.
‘Saptarishi’ will guide the economic policies
FM called ‘Saptarishi’ to look after the development policies. These ‘Saptarishis’, however, are not the old rishis like Kashyap, Atri or vashisht but the modern must be priorities for Indian economic development. These can be defined as ultimate results of development. The FM of course expect this development to happen not in the current year but in ‘Amrit Kaal’- a 25-year period. This period, however, is too long a period to wait for Inclusive Development, Reaching the Last Mile, Infrastructure development, Unleashing the Indian Potential of growth, Green Growth, engage Youth Power and develop Indian Financial Sector fully.
The ‘Saptarishi’ priorities
The ‘Saptarishi’ or the priorities listed in the budget 2023-24 were, Inclusive development- agriculture and cooperatives, health, education and skilling; Reaching to the last mile, that is antyodaya and include tribal development, micro irrigation, eklavya model schools and digitisation of ancient inscriptions; infrastructure development include increased capital investment, extend help to state governments, create urban infrastructure and increase connectivity to port, coal, fertiliser etc.; unleashing the potentials include, AI development, data governance, ease doing business, E-courts, 5G services etc.; Green growth include green credit, alternate fertilisers, mangrove plantation, optimal usage of wastelands etc.; youth power include launching new courses, boosting tourism and Unity mall etc.; Financial sector include introduction of national financial information registry, data processing centre, savings schemes to mahila and senior citizens, credit guarantee to MSMEs etc. All announcements and new programmes launched in 2023-24 budget were to boost these sectors.
What budget 2023-34 proposed
1. Agriculture and allied sector: The important schemes like Crop Insurance Scheme, Modified Interest Subvention Scheme (MISS), Distribution of Pulses to State / Union Territories for Welfare Schemes, Pradhan Mantri Kisan Samman Nidhi (PM-Kisan), Formation and Promotion of 10,000 Farmer Producer Organizations (FPOs), Pradhan Mantri Kisan Man Dhan Yojana, Agriculture Infrastructure Fund (AIF), Rashtriya Krishi Vikas Yojna and National Mission on Natural Farming will continue as they are. There are new proposals like building up of Digital public infrastructure for agriculture and setting up of Agriculture Accelerator Fund; cluster-based and value chain approach through Public Private Partnerships (PPP) to enhance the productivity of extra-long staple cotton; an Atmanirbhar Clean Plant Program to boost availability of disease-free, quality planting material for high value horticultural crops; making India a global hub for ‘Shree Anna’; PM Matsya Sampada Yojana; setting up of decentralised storage capacity in cooperatives; assistance for Upper Bhadra Project to provide sustainable micro irrigation and filling up of surface tanks for drinking water.
2. Infrastructure development: The budget has focused on this sector. The Capital investment is being increased to Rs 10 lakh crore. The budget to continue the 50-year interest free loan to state governments for one more year to spur investment in infrastructure. One hundred critical transport infrastructure projects, for last and first mile connectivity for ports, coal, steel, fertilizer, and food grains sectors have been identified. Fifty additional airports, heliports, water aerodromes and advance landing grounds will be revived for improving regional air connectivity. An Urban Infrastructure Development Fund (UIDF) will be established through use of priority sector lending shortfall and will be used by public agencies to create urban infrastructure in Tier 2 and Tier 3 cities.
3. Personal tax eased: Increased the rebate limit to Rs 7 lakh in the new tax regime. Reduced the number of slabs to five and increased the tax exemption limit to Rs 3 lakh. Extended the benefit of standard deduction to the new tax regime. The leave encashment on retirement of non-government salaried employees increased to Rs 25 lakh. Relief given to sugar co-operatives. Increased the threshold limits for presumptive scheme of taxation for eligible businesses from Rs 2 crore to Rs 3 crore and for specified professions from Rs 50 lakh to Rs 75 lakh. Tax on capital gains by investing proceeds of such gains in residential property capped at Rs 10 crore.
4. For poor and senior citizens: The financial support will be provided to poor persons who are in prisons and unable to afford the penalty or the bail amount. A scheme to supply free food grain to all Antyodaya and priority households for the next one year will be implemented. Mahila Samman Savings Certificate, will be made available for a two-year period up to March 2025. This will offer deposit facility upto Rs 2 lakh in the name of women or girls for a tenor of 2 years at fixed interest rate of 7.5 per cent with partial withdrawal option. The maximum deposit limit for Senior Citizen Savings Scheme enhanced from Rs 15 lakh to Rs 30 lakh.
5. Other important announcements: One hundred and fifty-seven new nursing colleges will be established. A Mission to eliminate Sickle Cell Anaemia by 2047 will be launched. Teachers’ training will be re-envisioned through innovative pedagogy, curriculum transaction, continuous professional development, dipstick surveys, and ICT implementation. A National Digital Library for children and adolescents will be set-up. Pradhan Mantri PVTG Development Mission will be launched. Three centres of excellence for Artificial Intelligence will be set-up in top educational institutions. A National Data Governance Policy will be brought out. E-Courts project will be launched. A Green Credit Programme will be notified under the Environment (Protection) Act. “PM Programme for Restoration, Awareness, Nourishment and Amelioration of Mother Earth” will be launched to incentivize States & Union Territories to promote alternative fertilizers and balanced use of chemical fertilizers. ‘Mangrove Initiative for Shoreline Habitats & Tangible Incomes’, MISHTI, will be taken up for mangrove plantation along the coastline. A scheme that will be implemented over the next three years to encourage optimal use of wetlands, and enhance bio-diversity, carbon stock, eco-tourism opportunities and income generation for local communities. Pradhan Mantri Kaushal Vikas Yojana 4.0 will be launched to skill lakhs of youth within the next three years. A national financial information registry will be set up to serve as the central repository of financial and ancillary information.
Fiscal management is important
True, budget 2023-24 made many announcements and many programmes will be launched during the year. The concern should be for high fiscal and revenue deficits and increased market borrowings to meet the same. The total expenditure for 2023-24 is estimated at Rs 45 lakh crores and fiscal deficit is at about Rs 18 lakh crores. The revenue deficit alone estimated at Rs 8.70 lakh crores and no efforts seen to reduce the same. The inflation is high and international conditions are volatile and therefore, things may not be favourable as thought of. True, Indian economy is returning to normal after pandemic and likely to perform better compared to other countries. The budget’s ‘Saptarishi’ and government’s intent to spend more on capital account may help the economy. As past performance of government announcements have shown positive results, hopes for budget promises are more.
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