Economists believe It is believed that in the general budget to be presented this week, there may be some announcements regarding the new pension system and social security schemes like Ayushman Bharat. However, there is little hope of relief in the case of income tax. He also says that to boost the economy, emphasis on infrastructure, increase in rural and agriculture allocation and steps are likely to be taken to promote micro and small industries. Finance Minister Nirmala Sitharaman will present the budget for 2024-25 for the seventh consecutive time and the first budget of the third term of the Narendra Modi-led National Democratic Alliance (NDA) government in the Lok Sabha on Tuesday i.e. 23 July.
Pension schemes will be emphasized in the budget
When asked about the expectations regarding social security schemes in the budget, renowned economist and professor at the National Institute of Public Finance and Policy (NIPFP), N R Bhanumurthy said, “Some announcements are expected on NPS and Ayushman Bharat in the budget. There has been a lot of discussion at the state level regarding pension schemes. The central government had also constituted a committee regarding NPS (New Pension System). The Prime Minister has said something about Ayushman Bharat. In such a situation, some announcements can be expected in both the schemes. “It is noteworthy that while releasing the Bharatiya Janata Party’s manifesto for the Lok Sabha elections, Prime Minister Modi had said that all citizens above 70 years of age will be brought under the ambit of Ayushman Yojana for free treatment up to Rs 5 lakh.
He also said that the party’s focus is on ensuring dignity and better life and employment of the people through investment. Regarding NPS and Ayushman Bharat, economist and Director General of research institute RIS (Research and Information System of Developing Countries) Sachin Chaturvedi said, “This is a very important area. Major programs are already close to reaching the full target. New measures can be expected in this direction.” In this regard, Professor Lekha Chakraborty at NIPFP said, “Social security schemes are important in the post-pandemic fiscal strategy. However, insurance schemes in the health sector make this system more expensive. Instead of insurance schemes, we need strong health infrastructure and health workers. ”
Efforts will be made to reduce the burden of health insurance
When asked about tax relief in the budget amid the BJP not getting a full majority in the Lok Sabha elections, Bhanumurthy said, “I do not think the election results will affect the direct tax policy. Since private consumption is a matter of concern, the GST Council should consider reducing its rates, especially when tax collection has reached a record level.” Chaturvedi also said, “I do not think there will be anything in this regard in the budget.” Chakraborty, who is also a member of the Governing Board of the Munich-based International Institute of Public Finance, said, “Reduction in tax rates will increase the disposable income in the hands of the people and it can promote consumption. But we have to keep in mind that only a small part of the country’s population (about four percent) pays income tax.”
All seven priorities need attention
Regarding the priorities in the budget, Chaturvedi, who is also a member of the RBI board of directors, said, “All the seven priorities already identified in the budget, inclusive growth, last-mile access, infrastructure and investment, capacity utilization, green growth, youth power and expansion of the financial sector should continue to be focused on.” He said, “In this context, three priorities are important for the budget. First, continued focus on infrastructure development keeping capital expenditure as a reference point. Second, boost rural and agriculture related allocation and finally, more encouragement should be given to micro and small enterprises. These three measures will not only have a positive impact on other sectors but will also increase employment in the economy. ”
The focus will be on development along with employment
Bhanumurthy said, “The priority should be to maintain continuity with medium-term policies for growth and to make some long-term reforms towards developed India. Apart from this, the potential growth rate of the economy should be brought to eight percent by continuing public capital expenditure along with providing support to the capital expenditure of the states. Chakraborty said, “This will be a budget to increase economic growth. However, there is very little scope for the Finance Minister to deviate from the path of fiscal consolidation. ” Responding to another question, Bhanumurthy said, “The budget is likely to focus on growth with employment. Since the PLI (production based incentive) scheme has helped the industry during the Kovid epidemic. Now there is a need to assess whether it has also helped in job creation. That is, there is a need to assess the PLI scheme. ”
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