Interim Budget: Eye on 2024, vision for 2047 | Latest News India - Hindustan Times
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Interim Budget: Eye on 2024, vision for 2047

By, New Delhi
Feb 02, 2024 06:15 AM IST

Interim Budget 2024: The budget aims to make India a developed country by 2047, and has been hailed as "inclusive and innovative" by PM Narendra Modi.

Interim Budget 2024: Finance minister Nirmala Sitharaman on Thursday presented an interim budget that promised policy continuity on the back of political stability, exceeded street expectations in terms of fiscal prudence, announced a significant increase in capital expenditure, and continued the Narendra Modi government’s emphasis on welfare, especially targeting the poor, women, the young, and farmers in a year when it is seeking a third term in power.

Finance minister Nirmala Sitharaman with her team ahead of the presentation of interim budget in Parliament on Thursday. (Sanchit Khanna/HT Photo)
Finance minister Nirmala Sitharaman with her team ahead of the presentation of interim budget in Parliament on Thursday. (Sanchit Khanna/HT Photo)

Eschewing populism, and in an implicit display of confidence over the outcome of the mandate, the finance minister indicated that the focus was on making India a developed country by 2047, a goal articulated by Prime Minister Narendra Modi. “In the full budget in July, our government will present a detailed roadmap for our pursuit of ‘Viksit Bharat’ (developed India),” she said.

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PM Modi termed the budget “inclusive and innovative”. Reacting to the budget speech he said it reflected “confidence and continuity”. “It will empower all four pillars of Viksit Bharat: yuva (young people), garib (poor), mahila (women) and kisan (farmers). This budget gives the guarantee of making India a developed nation by 2047.”

Also Read: Budget reflects centre's confidence in continuity: PM Modi

The opposition said the budget “lacked vision and accountability”.

“I listened to the budget carefully. Nothing was mentioned in this budget for the poor, lower middle class, or middle class. This is their budget only for day-to-day affairs. They did not give the details of promises made for 10 years, they should have compared how many promises were made and how many were fulfilled. They should give a comparative statement,” Congress chief Mallikarjun Kharge said.

PM Modi termed the budget “inclusive and innovative”.(HT graphics)
PM Modi termed the budget “inclusive and innovative”.(HT graphics)

On the macroeconomic front, the budget ticked the right boxes. The fiscal deficit this year (2023-24) is expected to be 5.8% of GDP, lower than street expectations — and the government will likely better it. It also estimates a deficit of 5.1% in 2024-25, putting the economy on the glide path to fiscal consolidation. The budget comes against the backdrop of the government’s latest GDP growth estimate for 2023-24, 7.3%, and at a time when inflation is under control and within the Reserve Bank of India’s comfort range of 4% plus-or-minus 2%. “Proactive inflation management has helped keep inflation within the policy band,” Sitharaman said.

On the welfare front, the budget continued the emphasis on the wide welfare net of this government, increasing the scope in specific housing and women’s empowerment schemes, and launching a new one for renewable energy. The low number of new schemes was also a reflection of the effectiveness, efficiency, and sheer scope of the government’s welfare schemes, many built around the DBT (direct benefits transfer) platform leveraging what is called the “JAM trinity” of Jan Dhan (no-frills bank accounts), Aadhaar (the unique ID), and Mobile (mobile phones). “Previously, social justice was mostly a political slogan. For our Government, social justice is an effective and necessary governance model. The saturation approach of covering all eligible people is the true and comprehensive achievement of social justice,” Sitharaman said.

Also Read | Interim Budget 2024: A little more for all labharathis? Focus on ‘core of core’ schemes

On the business front, the interim budget demonstrated consistency and continuity of policy by not really changing anything. The continued emphasis on capital expenditure, which the interim budget increases by 11% to over 11 lakh crore, will boost business, both directly and through the multiplier effect, and comes on the back of a threefold increase in cap-ex over the past four budgets. It is this expenditure that has powered the economy in the absence of private investment, although the finance minister suggested that the strategy of “crowding in” private investment is now beginning to bear fruit. Private investment is now “happening at scale”, she said in her speech.

Industry veterans hailed the budget.

“In this global environment of high uncertainty, macroeconomic stability driven by prudent fiscal management is of essence for growth and the much-needed resilience. In spite of the constrained canvas of an interim budget, the budget proposals have been substantive,” said R Dinesh, president of the Confederation of Indian Industry (CII).

And with an eye on the future, the interim budget announced a 1 lakh crore corpus which will be used to provide low-interest or interest-free loans of up to 50 years to power research and development, efforts to create an EV ecosystem and others to help India meet its net-zero emissions deadline of 2070, and an initiative aimed at accelerating bio-manufacturing.

Finally, on the political front — 2024 is an election year, and it would be too much to expect the budget to be shorn of politics — the interim budget both reiterated one important electoral strategy of the Modi government (a focus on the “castes” of the poor, young, women, and farmers, perhaps as a way to counter efforts by the opposition to mobilise the backward classes) and demonstrated its confidence that it will return to power in the summer’s general election. As is apt for a numerical exercise, a number says that best: in 2019, the interim budget speech lasted 102 minutes; in 2024, it lasted a mere 58.

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