Balanced Budget; Focus on rural infrastructure, small taxpayers and MSMEs to strengthen economy: PHD Chamber

While welcoming the Union budget 2017-18, Shri Gopal Jiwarajka, President, PHD Chamber of Commerce and Industry said the government has provided a balanced and growth-oriented budget; tax benefits to small taxpayers, MSMEs and Infra status to affordable housing are encouraging and would pave the way for a higher growth trajectory in the coming times.

Agenda “Transform, Energize and Clean India” – TEC to transform the quality of governance and quality of life of people, energize various sections of society and clean the country from the evils of corruption is inspiring and pragmatic.

Infra status to affordable housing would absorb semi-skilled and unskilled workforce in the housing and construction sector, generate employment opportunities and increase demand in the economy.

Though roadmap for MAT is encouraging, effective corporate tax was expected to reduce to the level of 25% to increase India’s competitiveness in global market as most of the economies have less than 23% effective rate of corporate tax.

The socio-economic focus across the segments including farmers, rural population, youth, poor and underprivileged will have a significant impact on the inclusive development of the country, said Mr. Gopal Jiwarajka.

The fiscal deficit target at 3.2% in 2017-18 is in line with the overall thought process of the government. It will help macroeconomic stability and improved growth outlook, going forward.

The 24% increase in the agricultural allocation from Rs. 1,42,289 crore in 2016-17 to Rs. 1,87,223 crore in 2017-18 reveals government’s continuous focus on agriculture reforms to strengthen the rural economy. 

Allocation under MNREGA increased to 48,000 crore from Rs 38,500 crore will enhance the rural consumption and help the rural economy to re-fuel demand.

To create additional 5000 Post Graduate seats per annum to ensure adequate availability of specialist doctors to strengthen secondary and tertiary levels of health care is a good start to fill the gaps in health infrastructure.

Announcements about the proposed amalgamation of existing labour laws into four codes pertaining to wages, industrial relations, social security and welfare will enhance the business sentiment particularly production possibility frontier of the MSMEs as the sector is impacted by existing stringent labour laws.

Reforms in the banking sector will expedite credit growth in the coming times.

Structural reforms in the digital economy vis-à-vis remonetization process are appreciable and help the economy to become less-cash dependent in the coming times.

Abolition of FIPB would attract foreign investors vis-à-vis removed roadblocks to foreign investment and a boost to Make in India program.

100% electrification vision of the government by May 1, 2018 will be a major boost to rural infrastructure and increase the standards of living in villages. It will boost the demand for consumer durables such as TV, fridge, washing machines, etc.

Railway lines of 3500 kms will be commissioned in 2017-18 that will fill the infrastructural gaps to an extent. Also, 2000 kms of coastal connectivity roads have been identified for construction and development purposes.

Allocation of Rs. 3,93,135 crore under a New Trade Infrastructure Export scheme will help to strengthen the export growth.

Political funding reforms to enable higher level of transparency like maximum amount of cash donation at Rs. 2000 per person and mandatory filing of tax return within the time prescribed for all political parties is a good start and welcomed.