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With a plethora of announcements, Modi government seems all set to take forward the Reforms agenda. Its commitment towards introducing the long-pending Goods & Services Tax, besides increasing focus on the rural development, Infrastructure and Health are positive steps that would not just boost overall confidence, but also go a long way in generating employment.
To fulfill Prime Minister Narendra Modi’s Make in India initiative, the Union Finance Minister Arun Jaitley has proposed a series of measures to mobile resources for innovation, startups, infrastructure development, mega projects by presenting Modi government’s first full fledge budget 2015-16 on February 28, 2015.
Presenting the general budget 2015-16 in the Lok Sabha, Arun Jaitley stated that the government will set up of a Self- Employment and Talent Utilisation (SETU) mechanism. The SETU will be a Techno-Financial, Incubation and Facilitation Programme to support all aspects of start up businesses, and other self-employment activities, particularly in technology-driven areas. An amount of Rs.1000 crore is being set up initially in NITI Aayog for SETU.
The minister further stated that “we are now seeing a growing interest in start-ups. Experimenting in cutting edge technologies, creating value out of ideas and initiatives and converting them into scalable enterprises and businesses is at the core of our strategy for engaging our youth and for inclusive and sustainable growth of the country.” He said concerns such as a more liberal system of raising global capital, incubation facilities in our Centres of Excellence, funding for seed capital and growth, and ease of Doing Business etc need to be addressed to create lakh of jobs and hundreds of billion dollars in value. With this objective in mind, SETU is being set up.”
The Arun Jaitley has stated his intentions to establish the Atal Innovation Mission (AIM) in NITI. AIM will be an Innovation Promotion Platform involving academics, entrepreneurs and researchers and draw upon national and international experiences to foster a culture of innovation, R&D and scientific research in India. Jaitley said that the platform will also promote a network of world-class innovation hubs and Grand Challenges for India. Initially a sum of Rs.150 crore wail be earmarked for this purpose.
Reacting to the budget, the Union Minister for health & Family Welfare, J P Nadda has termed it as balanced, progressive, pragmatic and pro-people. He said that the budget will lead to all around social and economic development that is inclusive and outcome oriented. The announcements of various mechanisms in expanding the healthcare insurance to the needy is a laudable step towards making healthcare affordable and accessible to all. Good health will enable higher productivity in various sectors, and thus forms an integral component of the development agenda of the country. “I welcome the move towards the Universal Social Security System backed by Accident Insurance and Bima Yojana”, Nadda stated.
Commenting on Union Budget 2015-16, Dr Jyotsna Suri, President, Federation of Indian Chambers of Commerce and Industry (FICCI) said, “The budget has also given a huge boost to the Make in India program by correcting the inverted duty structure in 22 thrust sectors and by allowing complete tax pass through for both category 1 and category 2 Alternative Investment Funds. The latter action, a long standing demand of FICCI, will help mobilise higher resources for investments in manufacturing sector.”
With this budget Dr Jyotsna Suri said, “We see after a long time clear national targets being set for the year 2022 that would mark 75 years of India’s independence. The announcements made by the government both in the budget as well as outside of it provide for a concerted effort to move towards these socio-economic targets.”
Sharing his thoughts, Rana Kapoor, President, Associated Chambers of Commerce and Industry of India (ASSOCHAM) said, “ More money in the hands of states would bring in growth from grassroots, reduction in corporate tax to 25% from 30% in a phased manner is a welcome move even though the businesses should be prepared to forego exemptions,”
Other credible measures include a boost to the small and medium enterprises through Micro Units Development Refinance Agency (MUDRA) Bank, major initiatives have been taken for deepening financial markets like bond markets, besides the decision to monetize gold are well thought measures,” said Kapoor and added that “The dampeners could be from the increase in service tax from 12 to 14% while deferment of General Anti Avoidance Rule (GAAR) and commitment on Goods and Service Tax (GST) are welcome measures.”
Sunil Duggal, Chief Executive Officer, Dabur India said “ Finance Minister has presented an inclusive and balanced Budget that seeks to put Indian Economy on a faster growth trajectory. With a plethora of announcements, this government seems all set to take forward the reforms agenda. Its commitment towards introducing the long-pending GST, besides increasing focus on the rural development, Infrastructure and Health are positive steps that would not just boost overall confidence, but also go a long way in generating employment. The announcement that the GST will finally be introduced on April 1, 2016 is definitely rejuvenating for the Fast-moving consumer goods (FMCG) industry. The increase in Service Tax from 12.36% to 14 %, however, could have been avoided at this stage especially with the advent of GST.
“His focus has been on empowering the Aam Aadmi and with his Income-Tax proposals, the individual tax payer can now get exemptions of up to Rs 4.4 Lakh. This would provide much needed relief to the salary earners and put more money and more savings in the hands of the common man. This, coupled with the abolition of Wealth Tax, will go a long way in fuelling consumerism. The reduction in Corporate Tax is a positive and will help make India Inc more competitive. It is also heartening to see that the new government has stressed on the need to make borrowers more accountable and the intent to introduce a Bankruptcy Law is a good step,” added Sunil Duggal.
Welcoming the budget proposals Sunil Duggal said, “Jaitley’s renewed focus is on improving infrastructure. Providing good infrastructure, particularly improving connectivity to the hinterland, has been mentioned as thrust area for the government. I am quite happy with the government continuing the rural focus and looking at enhancing allocation to MNREGA, besides focusing on skill development for the rural populace. These initiatives would help put more disposable income in the pockets of the rural consumer, improve their standards of living and ensure continued rural demand for branded consumer goods.”
Welcoming the Union Budget Prime Minister, Narendra Modi said “It is a budget with a clear vision. It is a budget that is progressive, positive, practical, pragmatic and prudent. Budget is investment friendly and removes all doubts on tax issues. It assures investors that we have a stable, predictable and fair tax system. Atal Innovation Mission and SETU underline our commitment to enable innovation, entrepreneurship and start-ups to grow and shine in India. 2015 Budget will further reignite our growth engine, signalling the dawn of a prosperous future #SabkaBudget.”