Budget 2018: The countdown to last full Budget of the present NDA government has begun as Finance Minister Arun Jaitley is likely to present it on February 1, keeping the tradition that was started in 2017. Experts expect this Budget to be a populist one due to the upcoming elections in eight states this year and the 2019 General Election. Arun Jaitley has dropped several hints on what’s going to be his priority for this Budget.
Here are five things that may be on top agenda for the Budget 2018:
Infrastructure: Economic Affairs Secretary Subhash Garg recently said that the government is planning to dedicate a large part of budget towards capital expenditure on infrastructure and will push for foreign investments in the sector. Arun Jaitley, too, said that the focus of the government next year will be on the momentum of infrastructure creation. Arun Jaitley said that while highways and ports have shown satisfactory results, infrastructure development in railways needs to be hurried. “Railway station, quality of trains, proposed bullet train, all need to be strengthened”.
Farmers: Various media reports suggested that the Budget 2018 would be focused on rural population and farmers. India’s government will likely increase funding for the farm and rural sectors in the budget for the coming fiscal year, Reuters reported quoting finance ministry officials. “The government can’t afford farmers’ anger anymore, and will try to boost the economic growth and pump in more funds in the farm sector,” the official said. “It will not be a populist but a pragmatic budget.”
Bank recapitalisation: The government has already announced a massive Rs 2.11 lakh crore massive bank recapitalisation plan, of which, Rs 76,000 crore will come from budgetary allocations and market raising. “We want to ensure the ability of banks to support growth by improving their lending capacity. If we want to formalise the economy, we have to strengthen the bank,” Arun Jaitley said while listing his three key priority areas for the next year.
Employment: The Narendra Modi government is likely to focus more on creating employment and employment-related funding. According to media reports, the government is likely to provide India with its first National Employment Policy (NEP) to address the crucial issue of job creation.
Corporate tax cut: Arun Jaitley, in his Budget 2015 speech, had proposed lowering the corporate tax rate from 30% to 25% over a period of four years. Before the 2018 Budget, which is the fourth and the last full Budget of the present government, the pressure to act on what was promised in 2015 is mounting — especially after the United States passing the law to cut corporate tax from 35% to just 21%. Corporate India, which met Arun Jaitley, during the pre-budget consultation meeting, had also put forth this demand.