Budget 2016: Focus on rural India, social welfare in Jaitley’s speech
Finance minister Arun Jaitley unveiled what appeared to be a pro-poor budget on Monday, announcing higher spending in the rural economy to fire demand.union budget Updated: Feb 29, 2016 13:18 IST
Finance minister Arun Jaitley unveiled what appeared to be a pro-poor budget on Monday, announcing higher spending in the rural economy to fire demand.
But the minister also promised to pursue economic reforms, including winning approval for a goods and services tax and a new bankruptcy law, to keep India expanding as the world’s fastest growing major economy in his second full budget.
He announced record investments in a rural job generating scheme as well as higher spending to boost irrigation as part of efforts to facedown looming crisis in the rural economy.
Jaitley announced two schemes to promote organic farming and said 28.5 lakh hectares will be brought under an irrigation scheme under the Pradhan Mantri Krishi Sichai Yojana.
Jaitley said a dedicated long-term irrigation fund will be created in NABARD with a corpus of Rs 20,000 crore.
“The total allocation for agriculture and farmers’ welfare is Rs. 35,984 crore,” Jaitley said, and added: “The government will allocate Rs 5,500 crore for a crop insurance scheme.”
“The government will reorient its intervention in farm and non-farm sectors to double the income of farmers by 2022,” Jaitley said, echoing Prime Minister Narendra Modi’s pledge to focus on the wellbeing of the agrarian community.
The ruling NDA dispensation has been criticised by opposition parties, especially the Congress, for allegedly being ‘pro-industrialist’ and ‘anti-poor’.
Shares of rural and agriculture companies were trading sharply up on measures suggested in the Budget speech.
Jaitley also said a unified agriculture market e-platform will be dedicated to nation on birthday of Dr. BR Ambedkar.
“We had to work in an unsupportive global environment and obstructive political atmosphere,” Jaitley said, in an apparent dig at the Opposition.
The finance minister has the job to make India regain its spot as an investors’ darling as well as signal long-term economic reforms without hurting the country’s vast consuming class.
“We must strengthen firewalls against risks through structural reforms, rely on domestic market so that growth does not slow down,” Jaitley said.
The government will undertake nine-point reforms, including steps to ensure ease of business in governance, fiscal discipline to ensure benefits for people, the minister said.
In his budget speech, Jaitley announced a new initiative to provide subsidised cooking gas to BPL families.
“I am presenting this budget when the global economy is in serious crisis… We converted difficulties and challenges to an opportunity.
“Indian economy has held its ground firmly,” Jaitley said as he began his speech.
>> Rs 1,000 crore allocated for new EPF (Employees’ Provident Fund) scheme
>> Rs 38,500 cr allocated for MNREGA in 2016-17, the highest ever if entire amount is spent
>> Rs 2.87 lakh crore will be given as grants-in-aid to village panchyats and municipalities to boost rural economy
>> Govt to spend Rs 850 crore in a few years on animal husbandry, cattle and livestock breeding
>> States will be encouraged to take up decentralised procurement of foodgrains
>> Record agri credit target of Rs 9 lakh crore in 2016-17 set
>> Rs 19,000 crore allocated for Pradhan Mantri Gramin Sadak Yojana in 2016-17. In all, Rs 27,000 cr after state contribution
>> Rs 2.87 lakh crore to be given grant-in-aid for gram panchayats and municipalities; it is quantum jump of 228%
>> Rs 60,000 crore for recharging of ground water recharging
>> Govt will work for passage of insolvency and bankruptcy laws. We will undertake significant reforms
>> Govt will enact a law to confer benefits on deserving sections on Aadhaar platform
>> Next financial year will cast an additional burden due to implementation of 7th Pay Commission and OROP
>> CPI inflation was 9.4% in the last 3 years of previous government. It has come down to 5.5% now
>> Growth has acclerated to 7.6% in 2015-16 notwithstanding contraction of global exports
>> Our external situation is robust, CAD has declined to $14.4 bn this year, will be 1.4% of GDP at the end of fiscal