Finance Minister Arun Jaitley has presented a positive Budget, amid concerns over mounting economic slowdown and weak global economy. This year’s Union Budget aimed to spend more in rural areas, infrastructure and poverty alleviation, and yet maintain long-term economic growth. It has also allocated funds to bring more irrigation, roads, electricity and sanitation to rural India.
Even though the Economic Survey, presented a day before the presentation of the Union Budget, painted a sober picture for 2016-17 — primarily due to a weaker second half — the Budget provides the necessary impetus to sustain GDP growth at over 7%. Agriculture and infrastructure have undoubtedly been given special attention, which will help in employment generation and boost the economy in the long run.
In addition, the finance minister has provided strong push to inclusive growth by significantly investing in the long-term drivers of the economy, such as education, skill development and growth of the rural economy.
Some of the other positives in the Budget presented were reduction in corporate tax rate from 30% to 25% for small companies with annual turnover of less than R50 crore to make them competitive in the global market.
It is a welcome step that would provide a much-needed fillip by creation of jobs and putting more money in their pockets. The government has shown its clear intent towards fast-tracking inflow of FDI, and the scrapping of the Foreign Investment Promotion Board (FIPB) is a notable step that would go a long way in supporting the objective of Ease of Doing Business and which may give further boost to FDI in the country.
In addition, the government’s impetus to reduce the borrowing cost and increase access to credit will surely help businesses to grow. We see the biggest-ever allocation to the infrastructure sector which would benefit all sectors, including the fast-growing pharmaceuticals.
Like in the preceding years, the Budget this year too did not announce anything specific for the pharmaceutical sector — although there were a couple of positive measures like the government’s efforts to amend rules governing drugs and cosmetics to lower prices and encourage use of generic products; a new Medical Device Bill is likely to come soon which may attract further investments in the pharmaceutical sector; as many as 1.5 lakh health sub-centres to be converted to health wellness centres; Aadhaar-based health cards for senior citizens; and the launch of the Digi Gaon initiative to promote telemedicine. You may also like to watch this video
Further, the finance minister reiterated his commitment to keep current account deficit and fiscal deficit under control; GST implementation will be as soon as possible. In conclusion, it may be said that the finance minister presented a positive Budget; as he mentioned in his speech, the government has set the agenda towards “transforming India”.