New Delhi, Feb 1, 2021: Finance Minister Nirmala Sitharaman’s first Budget of the new decade is a forward-looking Budget with a focus on economic growth, infrastructure development and privatisation, besides supporting employment generation. It takes the investment route to drive long-term economic growth with a focus on Healthcare.
The absence of any big negatives to spook sentiments is a big positive in itself. There is no COVID cess or increase in tax rates as was being anticipated in the run up to the Budget.
At a time of unprecedented economic stress when the government had little headroom for manoeuvre, the Finance Minister has rightly chosen to focus on higher capital expenditure and investments to pump up the economy. The 34% higher allocation under Rural Infrastructure Development Fund to Rs 40,000 crore will hasten development of infrastructure for agri and allied activities, social sectors and rural connectivity. This would go a long way in improving penetration and helping drive consumption of FMCG products in the hinterland. Dabur is investing on strengthening its rural footprint to 60,000 villages by the end of this financial year from 52,000 villages in March 2020.
The FM’s first Digital Budget has made generous allocations for key focus sectors like Healthcare, Railways, Roads and Water. There are also some decisive steps forward on the reforms front by raising the FDI limit in insurance, allowing registration of one-person company, privatisation of two public sector banks, besides unveiling a faceless National Income Tax Appellate Tribunal and offering relief to non-resident investors on dividend income. These are all positive steps in the right direction.
It's heartening to see the government take the bold move towards higher borrowings to focus on long-term growth. Overall, I would call it a growth-oriented and progressive Budget that lays down the blueprint for creating an enabling framework that would promote an Atmanirbhar Bharat.
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