One of the notable aspects of the budget is its fiscal discipline. The fiscal deficit is maintained at 4.9 per cent for the current year, with a target to reduce it to 4.5 per cent next year. This balanced fiscal approach ensures that resources are efficiently channelled to the desired sections while maintaining fiscal stability. Such stability is expected to attract liquidity flows into country and result in a lower cost of capital for India, fostering a conducive environment for economic growth.
The budget has earmarked Rs 11.11 lakh crore for Infra capital expenditure, accounting for 3.4 per cent of GDP. This significant allocation underscores the government’s commitment to building infrastructure and boosting the manufacturing sector. The focus on infrastructure development is expected to create a ripple effect, spurring economic activities and generating employment opportunities across various sectors.
Support for MSMEs is a key highlight of the budget. Providing credit guarantee for MSME loans up to 100 crores and Mudra Loans are aimed at bolstering the growth of small and medium-sized enterprises. These measures will provide MSMEs with the necessary financial support to expand their operations, innovate, and contribute significantly to the economy.
The reduction in customs duties on mobile phones, gold, and silver is another positive move. It will also make consumer electronics and jewellery more affordable, encouraging spending.
Salaried employees stand to benefit from the new tax regime, with potential savings of up to Rs 17,500 in income tax. This relief is expected to boost small-ticket consumption, as individuals will have more disposable income to spend on goods and services. The increased consumption will, in turn, drive demand and support economic growth.
The abolition of the angel tax is a significant step towards fostering a vibrant startup culture in India. By removing this tax, the government aims to encourage investment in startups, promoting innovation and entrepreneurship. This move is expected to attract more investors to the startup ecosystem, providing the necessary capital for new ventures to grow and succeed.
The government’s commitment to social welfare is evident in its plan to spend Rs 3 lakh crore on schemes benefiting women and girls. Increasing the participation of women in the workforce is a priority, and these schemes are designed to empower women, providing them with the skills and opportunities needed to contribute to the economy.
The government offers education loans up to 10 lakh rupees for students enrolled in any course at domestic institutions. This initiative aims to make higher education more accessible and will boost talent creation in the country. Additionally, students benefit from a 3% interest subvention e- voucher, reducing the overall loan cost.
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Disclaimer: Views expressed are by Vikas Khemani, Founder, Carnelian Asset Management & Advisors
First Published: Jul 24 2024 | 12:08 PM IST
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