According to him, this move will benefit 99% of companies and the revenue foregone is pegged at Rs 7,000 crore in 2018-19. This is likely to help the government in the long run in achieving the targets of reducing fiscal deficit to 3 per cent of GDP by 2024-25 and the government debt to 40 per cent of GDP from the current level of 49 per cent. This will probably make the ratings agency, Moody's, cringe given its recent upgrade of India's sovereign rating. It also needs to do more to alleviate the agrarian crisis in India. However, this could have been extended to all corporates leading to more investments and job creation.
While he has implemented big ticket reforms like the goods and services tax and further liberalised the economy, unemployment remains a serious problem.
"The corporate tax provision announced by Finance Minister Jaitley touches only 1.8 per cent of the industries", Raju said. We were expecting waiver of GST for senior citizen health insurance, tax sops for insurance products like home and term life insurance (extremely low on penetration) that provide super-essential and now absent financial security to the middle-class population at large. Rs 2,000 crore will be provided for development of agri market and export of agriculture commodities will be liberalized. "With focus on growth, it is the budget to look forward that would add an impetus to India's growth story", Micromax's Aggarwal noted in his comments.
Professor Biswajit Dhar from the Jawaharlal Nehru University noted that a key requirement for rural India, which accounts for almost 70 per cent of the population, was to boost agriculture productivity.
The Government will keep the MSP of unannounced Kharif crops at least 1. The announcement of 1000 Prime Minister Research fellows is a good initiated to further research in India. It remains to be seen how effective these measures will be in improving farm incomes and its attendant inflationary impact.
"BACC reaffirms its unstinting assistance to the government, and all regulators, in helping evolve a robust ecosystem for crypto currencies", said Ajeet Khurana, Head, The Blockchain and Cryptocurrency Committee of India (BACC). But the Modi government's tenure has seen a collapse in private investment from 36% to 27% of GDP, and an export-squeezing 21% rise in the rupee's real effective exchange rate. That is not directly addressed in the budget except the railway university.
The FM announced massive spending on rural and urban infrastructure as also lower tax rates for small and medium enterprises.
However, being the Finance Minister, Jaitley should know that inflation affects common citizens too, including salaried middle class, yet he failed to increase the IT slab to Rs 5 lakh.
The government also launched the world's largest state-funded health program - "National Health Protection Scheme" under which the government promises to provide up to $32,000 to poor families every year for secondary and tertiary healthcare.
But there's only so much the government can do given that it accounts for 12% of all expenditure.
Through Budget 2018, the government has successfully progressed from its "ease of business" agenda to "ease of living" ahead of general elections in 2019.
He, however, said the GoI will explore use of blockchain technology proactively for ushering in the digital economy.