UNION BUDGET — First budget of Modi-2 fails to spring surprises, no big-ticket reforms planned; it’s the usual blah-blah


NEW DELHI: The first budget of the Modi government in its second five-year-term did not spring any surprise. Since the government had introduced major social welfare and pension schemes for farmers, the unorganised labour and retail traders, in its mini-budget introduced and passed in Parliament two months before the 2019 Lok Sabha polls,  the present budget – for the coming nine months – was a continuation of the previous one.

The middle class expected attractive changes in the Income Tax sector, but there was nothing special for the salaried class. The Rs five lakh income ceiling for avoiding tax remains as it is. Those in higher brackets of income tax will have to pay more. Those with an income of more than two crore to five crore will have to pay a surcharge at the rate of 3 per cent of their income, and those earning above five crore will have to pay a surcharge at the rate of seven per cent.

The government opted not to budge and earn the goodwill of the salaried middle class even though assembly elections in the coming months will see Mumbai, Delhi and Pune, among some other big cities exercising their franchise. The government thinking appears to be that it can afford to go easy for now, as the Lok Sabha polls are just over and the government has a long five-year uninterrupted term. 

Yet, the social welfare sector has not been ignored altogether. Nearly 1.95 crore free houses are proposed to be provided to BPL families under the Pradhan Mantri Awas Yojana. Also, some 1.25 lakh km of roads will be upgraded under Pradhan Mantri Gram Sadak Yojana at an estimated cost of nearly Rs. 80,200crore, which would mean pumping a lot of money into the rural sector and helping the labour force find steady income.

Sitharaman claimed that the government has made big advances in tackling the problem of non-performing assets or NPAs. “The hard measures of the past three years have brought great relief. A record recovery of over Rs. 4lakh crore has been achieved over the last four years. The government proposes to allocate Rs. 70,000crore for PSU bank recapitalisation. The railway infrastructure will require a heavy investment of Rs. 50lakh crore up until year 2030.
In the rural sector push, the government stresses on complete electrification of villages. The recommendations of a high-level empowered committee of retiring power old plants and other structural reforms will be taken up. A one-nation, one grid policy is contemplated for implementation.

The Modi government’s UDAY has been of much help to the nation. Multiple measures would be undertaken to deepen the corporate bond market.  A proposal is to increase minimum public shareholding in companies to 35 percent from 25 percent. Sitharaman said the government intends to encourage heavy inflow of FDI in sectors like the media, aviation etc.
On the education sector, she said the government is happy that a few Indian institutions have entered the global list of best institutions of higher learning, where Indian presence was lacking.  The government plans to make India a hub of higher education so that foreign students in large numbers can be encouraged to do their higher studies here. It plans an allocation of Rs. 400 crore for setting up or fashioning world-class higher education institutions.

On the tourism front, where India is not able to make a major mark yet, the government aims at developing 17 sites as world-class tourist centres. Goa is by far the only place where tourists land up in large numbers now because of the presence of orderly night life. Mumbai has lost its old charms, but Delhi attracts sizeable number of foreigners, many of them heading for Rajasthan, Himachal Pradesh and also Agra.

The government’s Bharatmala project is aimed at enhancing road connectivity. Sagarmala will also help in better port and waterways connectivity.  These UDAAN scheme in the aviation sector, started by the Modi government in its first term to take aviation to tier-2 cities etc, is hoped to improve connectivity and bridge the rural and urban divide, Sitharaman said.
MODEL TENANCY LAW: The government aims to come up with a Model Tenancy Law. “Current rental laws are archaic as they do not address lessor-lessee relationships fairly. A model tenancy law will be finalized and circulated to states,” the minister said, adding the government would work on reforms to promote rental housing sector across the nation.  India’s rental market is of $20billion size. Large parcels of land held by government and PSUs would be used to build large housing societies.
SUBSIDISED HOUSING FOR POOR: The minister said as part of the government’s steps to provide affordable housing for all, 1.5 crore homes were completed in the first phase of Pradhan Mantri Awas Yojana (PMAY). About 1.95 crore houses are proposed to be provided in the second phase of PMAY. The government’s plan is to provide housing for all homeless people by year 2022. An additional income tax deduction of Rs1.5 lakh on home loans for affordable houses costing below Rs45 lakh has been announced. AGENCIES, IHN-NN
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