The Budget’s push for job creation is welcome, but a key reason for firms to hire is a rise in demand and capacity utilisation levels. Economists feel the consumption push is limited.

Well, there is a moderate tax cut for the salaried class mainly, but also for others to a lesser extent. There is a continued push on capital investment. There is a big push on schemes like the PM Gram Sadak Yojana [rural roads], the Awas Yojana [housing], both rural and urban. These are big spenders in rural areas and there’s a big expansion with the former covering 25,000 more habitations. This is spending in rural areas by rural people who are employed in these roles. So, there is quite a big trust there. Similarly, the three crore new houses coming in, of which two crore would be in rural areas, is also actually a big trigger of consumption. So, I would argue there are measures here to trigger consumption, but they are not in the nature of direct cash transfers. They are consumption measures that act through creation of assets. By the way, the employment incentives, when paid, will also result in some consumption. So it is consumption through some desirable objective rather than consumption through just transfer of cash, for the sake of consumption.

What about measures to rein in food inflation, that has been spiking overall price rise?

Whatever can be done on food inflation is being done. There’s one important point which has not been very much highlighted which in the Budget — a substantial provision for the Price Stabilisation Fund with the highest ever allocation [₹10,000 crore]. We intend to use this more aggressively on the procurement of pulses and oilseeds, building up an adequate buffer stock in years of low prices, and then releasing it at times of high prices. This is an initiative to stabilise food prices, particularly on pulses and oilseeds. And we mean business about procuring it at MSP [Minimum Support Price] for these items. Once we do that, farmers will tend to shift… We hope to see an expansion in the production of these items and reduce the volatility in those prices.

For Andhra Pradesh and Bihar, you have provided funds for some projects, and promised to arrange funds for others…

These will be only through concessional multilateral loans, which could be from the World Bank, Asian Development Bank, JICA, AIIB… any of these institutions, which considerably extend assistance to India anyway. They will lend to the Government of India, and the GoI will on-lend to the States, just as with any multilaterally-funded projects in States. The banks are willing, and we will be able to tie it up. Building of a capital is very much an infrastructure activity. We have not discussed [any interest subvention for the States] yet.

The Budget pivots from targeting the fiscal deficit after 2025-26, to a focus on the debt to GDP ratio. Would this entail a goal like reaching 40% of GDP over time?

It may not necessarily be 40%. We are saying it will decline gradually, how far and how fast, we are yet to determine, but it will be on a declining path. So, after 2025-26, when we will be below 4.5% of GDP and that’s a commitment, the intention is that it will be below 4.5% definitely. But what will be the deficit will also depend on how much we need to keep the debt going down. Should the debt go down by x% and when should it reach what level, those are yet to be determined. So, the deficit will be under 4.5%, but it doesn’t necessarily mean it would be 3% of GDP. And we can afford more than 3%, and still keep the debt declining steady. So that is the change of approach.

Will we have a road map for it or we will take a view each year?

That’s something we will come up with. But we are saying one thing very clearly, that road map will be downwards. The trajectory of the road is downhill in terms of debt to GDP… how fast, what’s the gradient, will be [determined] on a year-to-year basis.

New Delhi:
INDIA bloc parties will stage protests in and outside Parliament today against what they describe as “discrimination” against opposition-ruled states in the recently unveiled Union Budget.

1. The high-level meeting saw participation from several prominent leaders, including the Leader of Opposition in the Lok Sabha Rahul Gandhi, Congress’ deputy leaders in both houses Pramod Tiwari and Gaurav Gogoi, NCP (SCP) chief Sharad Pawar, Shiv Sena (UBT) leader Sanjay Raut, TMC’s Derek O’Brien and Kalyan Banerjee, DMK’s TR Baalu, JMM’s Mahua Maji, AAP’s Raghav Chadha and Sanjay Singh, and CPI(M)’s John Brittas. Congress general secretaries KC Venugopal and Jairam Ramesh were also present.

2. “The concept of a budget has already been destroyed by this year’s Union Budget. They have completely discriminated against most of the states. So, the general sentiment of the INDIA bloc meeting was we have to protest against this,” said Mr Venugopal claimed following the meeting. He later expressed on social media that the budget was “extremely discriminatory and dangerous,” going against the principles of federalism and fairness.

3. As part of their protest, Congress chief ministers will also boycott the NITI Aayog meeting scheduled for July 27. “This government’s attitude is completely antithetical to Constitutional principles. We will not participate in an event that is solely designed to hide the true, discriminatory colors of this regime,” Mr Venugopal alleged.

4. On Tuesday, Finance Minister Nirmala Sitharaman presented the Budget for 2024-25, marking her seventh consecutive budget presentation, surpassing former Prime Minister Morarji Desai’s record. This budget is the first under Prime Minister Narendra Modi’s third term in office. During her speech, Ms Sitharaman said that the country’s inflation remains stable and is moving towards 4 per cent, with core inflation at 3.1 per cent.

5. “The ‘#BudgetForViksitBharat’ ensures inclusive growth, benefiting every segment of society and paving the way for a developed India,” wrote Prime Minister Narendra Modi on social media. 

6. Speaking exclusively with NDTV, Union Minister Kiren Rijiju claimed that “no one with a sane mind” will criticise the 2024 Union Budget. “I feel this Budget lays the strongest-ever foundation for ‘atmanirbhar’ Bharat because the Prime Minister has already given a clear-cut vision to make India a developed nation by 2047,” he said. 

7. Ms Sitharaman highlighted several key points in the budget, including rewards for key NDA allies, tax relief for new taxpayers, and a focus on job creation for youth. 

8. The budget introduced several changes to the tax regime, increasing the standard deduction in the new tax regime from Rs 50,000 to Rs 75,000 and revising tax slabs to benefit a broader range of income groups. Salaried employees can now save up to Rs 17,500 in income tax under the new slabs.

9. Additionally, the budget included a major announcement for professionals entering the workforce. The government will provide one month’s salary as a Provident Fund contribution for first-time employees, benefiting an estimated 210 lakh youngsters. Additional measures include raising the exemption limit for capital gains on some financial assets to Rs 1.25 lakh per year and abolishing angel tax for all classes of investors.

10. The budget also earmarked significant projects for Bihar and Andhra Pradesh, states whose political leaders recently aligned with the BJP to secure a parliamentary majority. For Bihar, the budget outlines the development of expressways and a power plant, while Andhra Pradesh will see infrastructure projects prioritised, including substantial financial support for capital development.

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Chief Minister Siddaramaiah. File

Karnataka appears to be entering a fresh round of tussle with the Centre as the Congress-ruled State on July 23 declared that it will boycott the NITI Ayog meeting convened by Prime Minister Narendra Modi in Delhi on July 27, accusing the Centre of ignoring its demands in the Union Budget.

“We have decided to boycott the NITI Aayog meeting, which will be chaired by Prime Minister Narendra Modi on 27 July, as a mark of protest,” announced Chief Minister Siddaramaiah in his post on social media platform X hours after the Union Budget was presented by Finance Minister Nirmala Sitharaman.

“Despite my earnest efforts in calling for an all-party meeting of MPs in New Delhi to discuss Karnataka’s essential needs, the Union Budget has neglected our State’s demands. Finance Minister Sitharaman, who also attended the meeting, has ignored the concerns of the people of Karnataka. We don’t feel Kannadigas are heard, and hence there is no point in attending the NITI Aayog meeting,” the Chief Minister said, who earlier listed out the demands of Karnataka “ignored” by the Union Budget at an earlier press meet.

Launching a direct attack on Prime Minister Narendra Modi, he said, “Mr. Modi is unable to see States other than Andhra Pradesh and Bihar because his eyes are set on retaining his post.”

He further said even the demand to approve Mekedatu and Mahadayi projects had been ignored, while funds for metro rail and other infrastructure projects are “still a distant dream.”

It may be noted that the Congress government in Karnataka had launched an offensive against the Centre before the Lok Sabha polls by taking up “My tax, my right” campaign against the alleged injustice meted out to it in the devolution of State’s share of central taxes and development grants. The ruling Congress legislators had staged a protest against the Centre in Delhi then. The State has also launched a legal fight against the Centre by approaching the Supreme Court against the delay in the disbursal of drought relief.

Union Finance Minister Nirmala Sitharaman. File
| Photo Credit: PTI

Finance Minister Nirmala Sitharaman will present the Union Budget 2024 on July 23 at 11 a.m. It will be a record seventh consecutive Budget presentation for Ms. Sitharaman.

The Budget Session of the Parliament started on Monday with the Economic Survey 2023-24 being tabled in both Houses. The session is scheduled to have 16 sittings and is likely to conclude on August 12.

Also Read : Budget 2024 LIVE News, highlights: 23 July

The Budget 2024 presentation will be streamed on various platforms. Viewers can watch the Budget 2024 speech by Nirmala Sitharaman live at The Hindu. Follow our liveblog for all the latest news, reactions, and analysis of Budget 2024. The Finance Minister’s address will also be available to stream live via the Sansad TV.

Viewers of Sansad TV will have the option of listening to the Budget speech 2024-25 in Hindi. As expected the Budget Speech will be in English. STV 1 will telecast the Budget speech live in English only. Whereas Budget speech in Hindi can be listened on STV 2. For accessing the Budget speech in Hindi on STV 2, viewers will need to navigate through the language settings of the set-top box by using the remote control. By selecting Hindi language one can listen Budget speech in Hindi.

The July 23 Budget speech is expected to focus on infrastructure development, social welfare schemes, measures to boost economic growth and simplification of personal tax regime.

Finance Minister Nirmala Sitharaman proposed to double the deposit limit for Senior Citizen Savings Scheme to ₹30 lakh
| Photo Credit: PTI

Finance Minister Nirmala Sitharaman on Wednesday proposed to double the deposit limit for Senior Citizen Savings Scheme to ₹30 lakh and Monthly Income Account Scheme to ₹9 lakh.

In her Budget Speech, the minister also announced a new small savings scheme for women.

“The maximum deposit limit for Senior Citizen Savings Scheme will be enhanced from ₹15 lakh to ₹30 lakh,” the minister said in her 87-minute long speech.

She also proposed that the maximum deposit limit for Monthly Income Account Scheme will be enhanced from ₹4.5 lakh to ₹9 lakh for a single account and from ₹9 lakh to ₹15 lakh for a joint account.

Announcing a new ‘Azadi Ka Amrit Mahotsav Mahila Samman Bachat Patra’, Ms. Sitharaman said a one-time new small savings scheme, Mahila Samman Savings Certificate, will be made available for a two-year period up to March 2025.

“This will offer deposit facility up to ₹2 lakh in the name of women or girls for a tenor of 2 years at fixed interest rate of 7.5% with partial withdrawal option,” she said. The minister also announced to that an integrated IT portal will be established for investors to reclaim unclaimed shares and unpaid dividends from the Investor Education and Protection Fund Authority with ease.

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Clean green hydrogen energy generation.
| Photo Credit: Getty Images/iStockphoto

Underlining a commitment to accelerate the Indian economy’s transition to one powered by green energy, Union Finance Minister Nirmala Sitharaman in her Budget speech on Wednesday mentioned a slew of schemes aimed at promoting clean energy and sustainable living.

Green energy was among the ‘Saptarishi’ or seven guiding lights Ms. Sitharaman mentioned in her address that would steer India through ‘Amrit Kaal’ (next 25 years).

She said the Ministry of Petroleum and Natural Gas had earmarked ₹35,000 crore for “priority capital investment”, though neither her speech nor the Budget documents provided more clarity on it.

Following up on the government’s recent announcement of giving a push to ‘green hydrogen’ and promoting renewable energy projects, the Minister said battery energy storage systems with a capacity of 4,000 megawatt hours will be “supported” with viability gap funding to encourage investment.

The Budget also waived customs duty on capital goods and machinery for lithium-ion battery manufacturing. The move is expected to make electric vehicles and storage systems cheaper.

Boost for solar projects

The Ministry of New and Renewable Energy has received a budgetary allocation of ₹10,222 crore, a 45% hike from the ₹7,033 crore it expects to spend in the current financial year. The most significant hikes in the Ministry’s programmes are for ‘off-grid’ solar projects, on which the government is expected to spend ₹61 crore in the current fiscal but has budgeted ₹360 crore for the coming financial year.

India had a target of installing 100 gigawatt (GW) of solar power projects by 2022 but has only installed 63 GW. Off-grid solar projects constitute less than 5% of the target. The allocation for solar power expected to be supplied to the grid has been raised to ₹4,970 crore, up from the ₹3,469 crore expected to be spent by March 2023. The National Green Hydrogen Mission – a ₹19,000-crore programme to produce, use and supply hydrogen from renewable energy sources – has been allotted ₹297 crore.

3 key measures

“For the budget allocation of ₹35,000 crore (about $4 billion) to start catalysing the nearly $30 billion in energy transition finance required annually by India for its net zero future, three types of measures will be needed: risk guarantees to reduce the cost of capital for low-carbon investments in the country; demand aggregation measures as has been done for LED lighting and electric buses; and viability gap financing for hydrogen electrolysers and offshore wind as announced for battery storage,” Ulka Kelkar, director, World Resources Institute, said in a statement.

Ms. Sitharaman also mentioned a ‘green credit’ programme to be notified under the Environment (Protection) Act. “This will incentivise environmentally sustainable and responsive actions by companies, individuals and local bodies, and help mobilise additional resources for such activities,” she said. “Building on India’s success in afforestation, the Mangrove Initiative for Shoreline Habitats and Tangible Incomes (MISHTI) will be taken up for mangrove plantation along the coastline and on salt pan lands,” she added.

An official in the Environment Ministry, who declined to be identified, told The Hindu that such a programme would be “sweeping” and involve multiple Ministries. “It’s still being finalised. However, it will involve several existing schemes that incentivise emission reductions by industries or the growing of plantations in barren land [that become stores of carbon over time].”

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