New Budget to Increase India’s Economic Growth
India’s new budget was released by the government’s finance minister Arun Jaitley on Saturday. It contained strategies to be implemented that would provide an enabling environment for economical growth. The budget strikes a right balance between expenses incurred from the provision of social amenities, welfare for the poor and investment.
Narendra Modi, the new prime minister of India promised to bring a revolution to the Indian economy before stepping into office last year and this is the first budget geared towards implementing what was promised.
The budget included plans to really cut down corporate tax, increase employment and also provide social security system. This produced a positive response from Indian business leaders and economists. They think the new budget will launch the country to an era of progressive growth, estimating an economical growth of about 8.5 percent in the year ahead.
Ajay Shriram, Confederation of Indian Industries President said that – “It’s a very positive budget. No big bang, but a steady move forward, It’s moving in the right direction”.
The finance minister, Arun Jaitley said to the parliament in India while unveiling the budget that the rate of growth of the nation was constant with low inflation rates and an increase in the foreign exchange reserves.
“We inherited a sentiment of doom and gloom. The investment community had almost written us off. We have come a long way since then, we have turned around the economy, dramatically restoring macroeconomic stability and creating the conditions for sustainable poverty elimination, job creation, durable double digit economic growth.” the Indian finance minister said in his speech at the parliamentary meeting. He also stressed that “the credibility of India’s economy has been re-established. India is about to take off on a faster growth trajectory once again.”
Some of the main focus of the new budget are:
To make pensions and insurance accessible to the less privileged in the Indian society through a “universal social security” system.
Funds for welfare will be directly transferred into bank accounts so as to stop corrupt practices.
To solve energy problem by increasing electricity wattage through the installment of five 4000 megawatts power plants.
Tax for services and goods will be the same through out the nation by the year 2016.
To increase growth, funds invested in infrastructure will be increased to $11.3 billion.
The finance minister, Arun Jaitley also said that “India’s high corporate tax rates compared to other Asian countries hurt its ability to attract foreign investment, and lowering the tax rate will bring higher growth and more jobs”.