By Mohit Malhotra
Finance Minister Nirmala Sitaraman’s first Budget of the new decade is a highly growth-oriented and forward-looking Budget that focuses on pumping up economic growth. While it comes in the backdrop of the Covid pandemic and at a time of unprecedented economic stress where the government had little headroom for manoeuvre, this digital budget clearly displays the government’s intent to drive back economic growth.
With this Budget, the government has decided to take the investment route to drive long-term economic growth with a focus on healthcare, infrastructure development and privatisation, besides supporting employment generation. As part of a newly launched Aatmanirbhar Swasth Bharat Yojana, Sitharaman allotted `35,000 crore for coronavirus vaccines in the country. A budget of `2 lakh crore was allocated for the healthcare sector.
The government has stayed on the path of its Aatmanirbhar Bharat Abhiyan and announced a series of right measures to speed up growth and shore up an economy badly hit by the pandemic. The absence of any big negatives to spook sentiments is a big positive in itself. There is no Covid cess or increase in tax rates as was being anticipated in the run up to the budget.
Budget 2021 delivered a big bang boost for the infrastructure sector as the government aims to ride on it to reach the goal of $5-trillion economy. The 34% higher allocation under rural infrastructure development fund to `40,000 crore will hasten development of infrastructure for agri and allied activities, social sectors and rural connectivity. This would go a long way in improving penetration and helping drive consumption of FMCG products in the hinterland. Dabur is investing on strengthening its rural footprint to 60,000 villages by the end of this financial year from 52,000 villages in March 2020.
The FM has also made generous allocations for key focus sectors like healthcare, railways, roads and water. There are also some decisive steps forward on the reforms front by raising the FDI limit in insurance, allowing registration of one-person company, privatisation of two public sector banks, besides unveiling a faceless national income tax appellate tribunal and offering relief to non-resident investors on dividend income. These are all positive steps in the right direction.
The first budget of the new decade tries to strike a balance between supporting growth and a modest deficit reduction. Overall, I would call it a growth-oriented and progressive budget that lays down the blueprint for creating an enabling framework that would promote an Aatmanirbhar Bharat.
The author is CEO, Dabur India