A day after presenting the Budget for 2023-24, finance minister Nirmala Sitharaman said growth was the predominant focus from Day 1 when she and her team sat down to prepare the last full-year Budget ahead of Lok Sabha elections.
“The Prime Minister was also on board with it. He said growth ka momentum rakhna chahiye (we need to keep the growth momentum). If anything, we need to speed it up, oil it better and run it better, and that is why this number of Rs 10 trillion for capital expenditure came up,’ Sitharaman said in an interview.
She said given that there was no let-up in the pandemic, and the hit the private sector took due to this, the government remained consistent with its capex plan over the last three years. “We weren’t really looking if they were investing or not. We went about investing. Simultaneously, of course, the private sector has come out, the twin balance sheet problem has been addressed, they have deleveraged themselves considerably,” she said.
To a question if the high government capex outlay for yet another year meant the private sector was still averse to invest, she said: “We cannot sit back and watch. So I’m not even getting into that terrain where you’re saying that it (private sector investment) may not happen this year also and, therefore, would you want to go on with the government expenditure…I’m single-mindedly going on this ground that this is a golden opportunity for India. We should really not miss the bus.”
Sitharaman also said the huge capex did not mean she had wielded the axe on welfare spending. Citing the Rs 79,000-crore allocation for PM Awas Yojana and the higher outlay for Jal Jeevan Mission, which goes to states in the form of grants, she noted that even for NREGA, it being a demand-driven programme, the government would keep adding to its allocation through extra grants during the year.
By allowing standard deduction and restructuring the tax slabs, the finance minister said she expected about 50-55% of taxpayers to shift to the new exemption-free income tax regime. “Even for those utilising the maximum available exemption (in the old regime), the new regime without exemptions would be attractive,” she said.
India had 82 million taxpayers in 2019-20. Though the tax department could not immediately provide the number of taxpayers who have moved to the new tax regime over the last two years, an official said, the number was small.
The finance minister said her Budget estimates on growth and revenue for the next year were realistic. To a question if the revenue projections were understated, she said: “I don’t want to have a “feel good” number, which we later find is not achievable…At the same time, I don’t want to underestimate capabilities, because this is the time when we are giving impetus for growth.”
When pointed out that global research agencies have projected lower growth estimates for India than the government’s nominal growth projection of 10.5% for 2023-24, Sitharaman said: “Globally, everybody’s challenges are increasing, and therefore, there will be a dip in 2023-24…So, this dip (in projections by other agencies) is also because of the global uncertainty, which is not relenting at all… People, however much they are trying, are not able to extricate their economies from it. That’s why this difference. Especially with this Budget, I think it is going to be completely the global uncertainty rather than what is happening within the country. And for that, like I said, we need to be prepared.” Asked if she was disappointed that she didn’t push the envelope on some of the difficult reforms like land, farm and labour, the FM said: “The government’s commitment and its intent on reforms is intact. But the fact remains that many of those, who supported it earlier, reneged…Governance is also about working together with people however much anybody would campaign against us. I’m very clear on all the three, that the positions of people (who opposed) have been hypocritical and undermined elected representatives’ decision-making in Parliament.”