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Budget 2018 | This Budget will make growth sustainable: Ashok P Hinduja

The focus was on boosting rural and urban growth, increase discretionary spending and drive Infrastructure development

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Ashok P Hinduja
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Budget 2018 could prove to be transformational for Bharat Varsh. It has addressed the needs of all the segments of the society, including students, women, senior citizens, farmers, SMEs and the salaried class. The focus was on boosting rural and urban growth, increase discretionary spending and drive Infrastructure development.

The focus on health, education and poverty reduction will go a long way in making the growth of the Indian economy more sustainable. The overall revenue receipt is expected to grow by 9.55% in FY 18 and for the new fiscal; it is estimated to grow at 14.63%. With the digitisation of the tax administration, the government would be able to achieve the revenue growth targets.

Considering the present economic conditions, restricting the fiscal deficit to 3.5% in March 2018 and the target of 3.2% in March 2019 is commendable. It has been able to contain the deficit through divestments.

To give impetus to the agricultural sector, Budget for financial year 2018-19 provides for higher minimum support prices and an increased farm credit target.  The concept of Agri Enterprise, one-third of the gross margin for the farmer, reduction in cost of farming and enhancing the revenue of farmers will go a long way in doubling the farm income.

The introduction of a health insurance scheme for over 10 crore families, with a cover of Rs 5 lakh a year, will increase the social security of families. This is the largest health Insurance scheme in the world and will provide good social security to those covered by this scheme.

Introduction of the Long-Term Capital Gains Tax on equity gains of above Rs 1 lakh may dampen investor sentiment in the near term. India is the only country that has dividend distribution tax, stock trading tax and long term capital gains tax. It was expected that the government would rationalise the tax structure.

Extending the corporate tax of 25% to companies having a turnaround of upto Rs250 cr would increase tax compliance and lead to increased capital investments. Giving tax concession to Farmer Producer Companies would create many more companies like Amul in India and boost the co-operative sector.

Investing Rs1 lakh crore over four years in improving educational infrastructure will go a long way in promoting education for all.

The government has also announced steps to boost infrastructure development in the economy. Apart from the planned expenditure, the provision to use Invit Structure to mobilise funds for infra projects will help generate funds for development. Road construction, affordable housing and tourism were low-hanging fruits to boost employment. The government has done well to capture them by allocating substantive funds.

One lakh gram panchayats have been connected under BharatNet. FY19 allocation for rural telecom is set at Rs 10,000 crore which would help digitisation of villages.

Ashok P Hinduja
Chairman, Hinduja Group Companies India

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