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Budget 2021-22 will fuel entrepreneurial spirit among Indians: Sitharaman
The finance minister on Monday unveiled a Union Budget providing significant increase in health and capital expenditure to boost the economy that contracted by 23.9% in the first quarter of the current financial year mainly because of a 68-day nationwide lockdown since March 25, 2020.
Union finance minister Nirmala Sitharaman on Thursday said despite the devastating impact of the Covid-19 pandemic on the economy, the Budget 2021-22 has not levied any new tax on the people, instead it has relied on non-tax resources other than just disinvestment for enhanced capital investments that will spur growth.
“I underline that we have not burdened any section of Indian society with any additional demand for even an additional rupee,” the finance minister said at a closed-door virtual meeting of the Federation of Indian Chambers of Commerce & Industry (FICCI).
Sitharaman on Monday unveiled a Union Budget providing significant increase in health and capital expenditure to boost the economy that contracted by 23.9% in the first quarter of the current financial year mainly because of a 68-day hard nationwide lockdown since March 25, 2020, but quickly recovered to contract by a slower 7.5% in the next quarter ended September 30. The recently launched Covid-19 vaccination drive has given a further boost with the International Monetary Fund (IMF) projecting 11.5% growth for India in 2021-22 and the Economic Survey estimating a real growth of 11%.
“This Budget marks a clear directional change for the Indian economy and that directional change is not what the government has offered as a sudden response, but it was something that was preoccupying the Indian minds for over 30 years,” she said while addressing FICCI’s national executive committee meeting on Thursday.
This Budget is trying to raise resources which are non-tax resources at a time when we need a lot of money to spend, FICCI said in a statement quoting her. “It’s a budget which raises resources but not on the back of increased taxation. There is a directional change in the budget which is so distinct that it will fuel the entrepreneurial spirit which Indians show given the right opportunities,” she added.
Stating that revenue generation would improve through this year, she expressed confidence about robust collection of non-tax revenue other than just disinvestments through various other monetisation of assets.
Sitharaman also urged the industry to come forward to make investments. “I hope the industry will understand the spirit with which the budget is placed before you and therefore also come forward to participate in this inevitable exercise. Industry, having cleared all its debts and finances, should now be in a position to invest money to expand and grow and clearly show signs that it is now ready to receive any joint ventures for the sake of technology that it prefers to have,” she said.
For providing immediate stimulus to the economy, the government will be spending in a big way in public infrastructure and three large areas where big ticket expenditure will happen include infrastructure, health and agriculture. “Government alone, even if it brings bags full of money, cannot meet the demand of growing and aspirational India,” Sitharaman said.
Speaking about the Budget proposal to set up Development Financial Institutions (DFI), the finance minister said the government will enable one DFI and the entire financing of long-term infrastructure will happen in a very market-driven way, which itself will bring in efficiency.
The government has taken up a confident, trustworthy and transparent accounting statement in our budget, she said. “There is no patching up or white washing. It has made an honest attempt to give an honest statement of the government’s finances and with the reforms announced along with the stimulus. It is clear that this government is not sitting cautiously, and it is coming forward with faith in Indian industry and business leaders,” she added.
