By Byju Raveendran
The Union Budget 2023-2024 is a fine convergence of economic growth, inclusive development, sustainable development goals, technological prowess, and fiscal prudence. Finance minister Nirmala Sitharaman has done well to walk the tightrope between short-term needs and long-term goals. This is a well-balanced Budget that sticks to the fundamentals of medium-term fiscal prudence while also providing the necessary boost to the economy in the current year. India will continue to shine as a ‘bright star’ and retain its position as the fastest-growing large economy in 2023.
The massive hike of capital investment outlay by 33% to Rs 10 trillion is bound to create millions of new jobs and also build the necessary infrastructure to sustain the rapid growth of India. The Indian Railways has been provided Rs 2.4 trillion, which is the highest-ever allocation to the national transporter. We are not just talking about infrastructure development in metro cities. The budget allocates Rs 10,000 crore per year to the Urban Infrastructure Development Fund (UIDF) which will be used for creating infrastructure in Tier-2 and Tier-3 cities. Inclusive development has remained a key theme for the current government in successive budgets.
By offering exemptions in income tax slabs and taking strong measures aimed at boosting manufacturing, agriculture, green energy, healthcare and education, the Budget aims at consumption-led progressive growth. It is commendable that this boost to the economy does not compromise on the fiscal glide path that the government remains committed to. The fiscal deficit estimate of 2023-24 is 5.9% of the GDP, which is expected to fall further to below-5% in FY 2026.
The tax revenue foregone due to the various rebates is Rs 35,000 crore annually, which will go a long way in incentivising consumption and driving growth, which will create a cascading effect and benefit several sectors. That, along with several other measures rolled out to incentivise the new tax regime, takes a big stride in making India more competitive globally.
The Budget’s focus to develop human capital is also well-received by individuals and industries alike. Growth-focused digital initiatives for skilling such as the launch of the Pradhan Mantri Kaushal Vikas Yojana 4.0 to skill millions of youth in the next three years in new age skills will enhance the employability of our youth, helping the nation reap the benefits of our demographic dividend in this Amrit Kaal.
The proposal to revamp teachers’ training via District Institutes of Education and Training, as well as setting up of National Digital Library for children and adolescents, will uplift learning outcomes in the education sector. The implementation of the Eklavya Model Residential Schools, with the recruitment of 38,800 teachers and support staff, will greatly improve education opportunities for tribal students.
Other inclusive initiatives, such as providing 9 crore drinking water connections to rural houses, household toilet construction, cash transfers to farmers, nearly 10 crore LPG connections under Ujjawala scheme, a huge 66% hike in the allocation for PM Awas Yojana, among others, also underscore the government’s intent to have efficient socio-economic development. Additionally, the Budget also showed its futuristic vision by inculcating new-age technologies, such as artificial intelligence and 5G, as part of its priorities.