Union Budget – Artifex.News

States seek improvements in 50-year interest-free loan scheme

admin — Sat, 22 Jun 2024 11:48:28 +0000

Union Finance Minister Nirmala Sitharaman.
| Photo Credit: PTI

States have urged the Centre to make some improvements in the 50-year interest free loan scheme for pursuing capital investment projects, under which the Union government has proposed to give them ₹1.3 lakh crore this year, the same amount as 2023-24.

Ministers from States made suggestions related to the ‘Scheme for Special Assistance to States for Capital Investment’, first launched in 2020-21, during pre-Budget consultations chaired by Union Finance Minister Nirmala Sitharaman on June 22.

Ms. Sitharaman also heard out several suggestions from State Ministers regarding the Union Budget 2024-25 likely to be presented next month, along with requests specific to their regions, and assured them that their ideas and inputs will get “due consideration by the Union Government during the preparation of Union Budget 2024-25”.

Apart from Finance Ministers from several States, the meeting was attended by the Chief Ministers of Goa, Meghalaya, Mizoram, Nagaland, and Sikkim, along with the Deputy Chief Ministers of Bihar, Madhya Pradesh, Odisha, Rajasthan and Telangana.

“In her remarks, the Union Finance Minister underlined Union Government’s support to States through timely tax devolution, Finance Commission grants, and arrears of GST Compensation being provided for providing stimulus to growth,” the Finance Ministry said in a statement.

On the ‘Scheme for Special Assistance to States for Capital Investment’, Ms. Sitharaman iterated that while most of the loans under it are untied, a part of the allocation is conditional and linked to citizen-centric reforms by States and sector-specific capital projects. She requested the States to avail these loans by fulfilling those requisite criteria.

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States to play a critical role in next generation reforms: CEA Anantha Nageswaran

admin — Mon, 05 Feb 2024 01:30:00 +0000

Chief Economic Advisor to the Government of India, Dr. V Anantha Nageswara.
| Photo Credit: SRINATH M

With the economy regaining momentum, it is time for fiscal policy to step back, Chief Economic Adviser V. Anantha Nageswaran told The Hindu, explaining the interim Budget for 2024-25. Identifying some of the next generation reforms needed in the coming years, he said recent changes, including the Goods and Services Tax (GST), Insolvency and Bankruptcy Code (IBC), and direct taxes also need a periodic review. Edited excerpts:

This Budget largely stuck to a vote on account with some signalling for the future, unlike the 2019 interim Budget. Was this based on the government’s 10-year track record which your recent Economic Review termed commendable?

That is the main reason. It’s also important to articulate that you come up with a counter-cyclical fiscal policy when it is needed, and when the economy recovers, you must pull back the fiscal stimulus slowly in such a way that you rebuild the fiscal space for the next time it is needed. The problem in the world today, and part of the reason inflation was such a big surprise for many countries in 2022 and 23… is not because of the Ukraine-Russia conflict or supply chain disruptions, [though] they might have added their bit. But the real issue was the stimulus that stayed too much, too big, and for too long. The same thing happened in India in 2010-11 and 2011-12, when the crisis didn’t affect us that much, but we still had a stimulus which stayed for too long. Then you have to deal with the aftermath. I don’t think we want to repeat all of that. At the same time, the government is not taking its eyes off the ball on financial inclusion and taking care of the poor. That’s why PM Gareeb Kalyan Anna Yojana was extended for five years. So this is the reason to stick to the framework of what a vote on account should be, and the projection of a 5.1% of GDP target for fiscal deficit. As the economy develops a momentum of its own, fiscal policy can go back to rebuilding the fiscal space which might be needed at some point in time in the future.

Now that the Central government debt to GDP ratio is 58%, should we review the timelines to reach the 40% goal enunciated for 2025-26 prior to the pandemic?

I think, over time, if you’re going to pursue faster fiscal consolidation, and your nominal GDP growth lies above the cost of borrowing, I think the debt to GDP will begin to consolidate regardless of whether you have a target.

You had identified some priorities for future reforms, including health and learning outcomes and easier MSME compliances, and the Budget mentioned next generation reforms. What would those entail?

Many reforms are not next generation, but a continuation. We have been doing Direct and Indirect Tax reform. Corporate tax rates have been simplified. For households, you have two options available to compute taxable income, and there are capital gains taxes on different assets. All those things can be re-examined even if you decide not to change them. What I would consider a next-generation reform is, as the Finance Minister said, about consultations and consensus building with State governments and stakeholders, because much of these lie in the realm of sub-national governments — States and below. Whether it is health or learning outcomes, skilling issues, land reforms, land conversions — the most important thing, and then the labour codes notification, which is key for employment generation. All these things are predominantly State subjects or equally between the State and the Centre. I would consider those as the areas for next generation reforms. The other area is the energy security aspect in the context of energy transition. You can’t do energy transition unless discoms are viable, which also falls in the realm of State governments.

Do we need a new prescription on discom reforms after the UDAY scheme?

Ultimately, everything has to come down to — are you economically viable and able to recover user charges correctly. Packages can only take care of the legacy losses. But to move forward, we honour power purchase contracts and we charge an economically viable rate, which is not unaffordable and not unviable for power producers. Therein lies the answer. If you want to subsidise, you must be extremely transparent and provide some kind of targeted transfer of money to those households and businesses whose consumption you want to subsidise, so that it is not generalised.

How important are reforms like GST rate rationalisation?

That is something the GST Council should look at. It’s about seven years since the introduction and rates are being rationalised over time for different reasons. But I think you can take a look at it from a comprehensive perspective. In the last Budget, the FM made a point about taking a look at the regulatory institutions and frameworks and regulations in periodic intervals. A similar thing can apply to any policy decision that is in perpetuity. If it has a natural sunset clause, it’s okay. But for things that are there forever, it is a good idea anyway to have a periodic review and take a look at how effective they are, what needs to be tweaked or overhauled. Many of these things like GST and IBC come under that category.

In the preface to the Economic Review presented before the Budget, you said 7% growth when the world economy is growing 2%, is better than 9% achieved with the world growing 4%. But we are slightly delinked from the world economy, with exports not really being a key growth driver…

Still, the marginal utility of growth in a growth-constrained world is definitely more precious, and it brings with it a lot of advantages in terms of drawing investments in. If everybody is growing 7% and the world economy is growing at 4%, investors have lots of options, including our domestic investors who can take money out these days. But if you’re growing at 7[%] and others are growing at two or three [per cent], then you definitely stand out, and that naturally lets our investors stay, and brings in foreign investors, both of the portfolio variety and the direct variety. And that naturally creates one virtuous circle. In that manner, you can definitely argue there are 7% GDP growth in a world which is growing at two to three per cent compared to eight when everybody’s going between four and five — this is definitely more precious. Moreover, we were not the only ones growing at 8%-9% in the past, which is why the BRICS coinage was conceived and investors had a choice. Today, you look at the emerging market or developed countries’ space. In G-20, we stand out because we did not overstimulate during the pandemic, we took care of the vaccination drive quite well, and we did not have a nationwide lockdown after the very first one. That allowed economic activity to resume quickly, and the stimulus wasn’t massive, but targeted, so you didn’t have to deal with the cleaning up as other countries are stuck with. So all these things are now enabling you to grow at a rate, which is may not be eight or nine, but seven. But in a growth-constrained world, it does help you stand out and that has its own advantages vis-a-vis attracting and retaining investments.

That high growth also culminated in the rise of non-performing assets.

Yes, I used to say then as well, as a columnist, that this is not high-quality growth and is unsustainable. And then we continued with the fiscal stimulus and monetary stimulus to bring back those growth rates. So, [former Reserve Bank of India (RBI) Governor Raghuram] Rajan himself said to a Parliament Standing Committee, in a written submission, that the bad debts were lent out between 2006-2008. As an RBI Governor who initiated the asset quality review, he must be knowing what he was writing about. So high growth and high quality growth would be absolutely desirable, but moderate yet high quality growth is far more desirable in a growth constrained world.

Part of the reason things went south then was that growth hopes got exaggerated after two years of 8%-9%, and businesses expected that to continue…

There’s always excess optimism. This is why we would rather have run a marathon at 7% than a sprint of 8% for three years, and then go down to 2%-3%.

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Highlights and key features of Interim Budget 2024

admin — Fri, 02 Feb 2024 09:29:00 +0000

Union Finance Minister Nirmala Sitharaman presents the Interim Union Budget 2024 at the Lok Sabha of the Parliament House in New Delhi.
| Photo Credit: ANI

Union Finance Minister Nirmala Sitharaman on February 2 presented the interim budget for 2024, ahead of the upcoming general elections.

With no dramatic pre-poll sops the Ms. Sitharaman stuck to fiscal deficit targets; announced new urban housing scheme, more rural homes, rooftop solar solutions; and turned the focus to eastern States.

Here are a series of videos by The Hindu detailing the same.

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Success of India grounded in pursuit of reforms over last years: IMF MD

admin — Fri, 02 Feb 2024 04:48:00 +0000

International Monetary Fund (IMF) Managing Director Kristalina Georgieva
| Photo Credit: REUTERS

The economic success of India is grounded in the pursuit of reforms over the last years, Managing Director of International Monetary Fund (IMF) Kristalina Georgieva said on February 1 exuding confidence that it would achieve its goal of being a developed nation by 2047 by staying the course.

“India has been a bright spot in the world economy, and it continues to be so. We are upgrading projections for Indian growth to 6.5% in 2024. This comes on the back of fairly strong performance in 2023. The success of India is grounded in the pursuit of reforms over the last years,” Ms. Georgieva told a group of reporters here.

Editorial | Poll posture: On the 2024 Interim Budget

Ms. Georgieva said that one very significant advantages of India is the bold actions on the digital front with the digital public infrastructure, digital ID and making digital a strong comparative strength of India allowing small entrepreneurs to tap into markets in the way they were not able to do before.

“We also see in India recognition that female participation in the labour markets is insufficient. I think Prime Minister (Narendra) Modi is right to bet on Indian women and open up more space for their participation in the economy,” she said.

“Last but not least, India recognizes that innovation is what is going to drive a future competitiveness, very effective and efficient investment in R&D as we saw with the moon landing. This creates a very fertile ground for future growth,” the IMF head said.

Also Read | India to emerge as third largest global economy by 2027: Finance Minister

“Where India needs to be watchful like all other countries, it has to be watchful how the strength of public finances and the use of public money support this medium long term objective of strong growth,” she said.

To a question on Prime Minister Modi’s call to make India a developed nation by 2047, when the country celebrates the 100 years of its independence, she said this is very much achievable.

“I see no reason why this will be unachievable. Stay the course,” Ms. Georgieva said hours after the Union Finance Minister in her interim budget said that the Modi’s government is working to make India a ‘Viksit (Developed) Bharat’ by 2047, and that this development would be “all round, all inclusive, and all pervasive”.

Also Read | Finance Ministry says economy likely to grow closer to 7% in 2024-25

The IMF managing director said staying the course also means eliminating obstacles for private entrepreneurship.

“I see in India as actually everywhere space for more to be done,” she said.

“This has been a very visible strength for India: confidence. And confidence not just in the leadership, (but also) confidence of the people. When I was last in India, I talked to people from all walks of life and there is that sense of confidence in the economy; confidence in the country,” Ms. Georgieva said.

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2024 Interim Budget | Biased in favour of rich: Chidambaram

admin — Thu, 01 Feb 2024 17:28:52 +0000

Former Finance Minister and Congress leader P Chidambaram addresses the media regarding the Union Interim Budget 2024 during a press conference, in New Delhi on Thursday.
| Photo Credit: ANI

India’s demographic dividend has been “destroyed” as the BJP-led National Democratic Alliance’s approach to the economy “is biased in favour of the rich”, Congress leader and former Finance Minister P. Chidambaram said on Thursday, after the presentation of the Interim Union Budget in Parliament. He added that the party was not afraid of a white paper analysing the previous Congress-led United Progressive Alliance government’s record on handling the economy.

Congress president Mallikarjun Kharge, in a video statement, claimed that both “vision and accountability were missing” from the Interim Budget. “Any budget has two aspects: one, to provide a status report on the previous years, and the other is to provide a vision for the next year. Both of these are missing from this Interim Budget,” Mr. Kharge said.

Addressing a press conference at party headquarters, Mr. Chidambaram slammed the Budget’s provisions for key sectors, including the youth, women, and farmers, as well as the policy of “minimum government and maximum governance”.

‘Rampant unemployment’

While Finance Minister Nirmala Sitharaman had talked about youth, she did not acknowledge the “rampant” unemployment, said the Congress leader, adding that she had not mentioned that over 30,000 farmers and agricultural labourers had died by suicide between 2020 and 2022, nor the low participation of women in the labour force.

“By deliberate neglect over the last 10 years, the government has destroyed the demographic dividend story and dashed the hopes of millions of youth and their families,” Mr. Chidambaram said. “It is a government of the rich, by the rich and for the rich. The government is either ignorant or callous to the fact that the top 10% owns 60% of the nation’s wealth and earns 57% of the national income, and that income inequality has widened significantly in the last 10 years,” he added.

Per capita income vs GDP

Asked about India being described as the fastest growing economy, the former Finance Minister said that the “fastest growing economy is not a badge of honour”.

“China’s GDP is five and a half times more than our GDP. If they grow at, say 3%, in order to match their annual growth, we have to grow at 15%… So don’t talk about GDP growth. Talk about the per capita income growth. If the GDP is growing at such a high rate, why is the per capita income growing at half that rate?” he asked.

High food inflation

The Congress veteran said that the Finance Minister had barely touched on the issue of inflation, despite the fact that food inflation is at 7.7%, while the real wages for casual workers have stagnated for four years. “She spoke about free grain to 80 crore persons, but she did not speak about India’s rank in the Global Hunger Index or the widespread malnutrition among children leading to a high proportion of stunting and wasting,” he said.

Mr. Chidambaram added that the “minimum government” policy has, in reality, “undermined federalism, starved State governments of funds and virtually reduced the third tier of governance — panchayats and municipalities — to ciphers”.

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2024 Interm Budget | Allocations for Social Justice and Tribal Affairs Ministries see a marginal increase

admin — Thu, 01 Feb 2024 17:02:32 +0000

The interim Budget saw an allocation of ₹13,000 crore for the Ministry of Tribal Affairs for the next fiscal year.
| Photo Credit: BISWARANJAN ROUT

The Estimates presented by Finance Minister Nirmala Sitharaman for financial year 2024-25 on February 1 left the budgets for Social Justice and Tribal Affairs Ministries largely unchanged with marginal increases seen in the estimated allocations for both ministries compared to the FY 2023-24 Budget Estimates (BE). While ₹14,225 crore has been set aside for the Ministry of Social Justice and Empowerment, ₹13,000 crore has been allocated for the Ministry of Tribal Affairs for the next fiscal year.

This comes even though the Revised Estimates for FY 2023-24 saw expenditures reduced by 38% and 23% for the Tribal Affairs Ministry and Social Justice Ministry, respectively, compared to the allocations set aside in BE 2023-24.

The Social Justice Ministry was able to spend only small percentages of the amounts set aside for key schemes like the SEED scheme for Denotified, Semi-Nomadic and Nomadic Tribes, the National Action Plan for Drug Demand Reduction, and the NAMASTE scheme to end unsafe sewer cleaning throughout FY 2023-24, as per the Revised Estimates. Similarly, the Tribal Affairs Ministry fell short in spending on its flagship project of Eklavya Model Residential Schools (EMRS) and on transfers to States under the PM Adi Adarsh Gram Yojana.

Despite this, the government has prioritised spending on these schemes for the next financial year. For instance, the Social Justice Department has increased the allocation under the NAMASTE scheme to ₹116.94 crore even though it was able to spend just ₹30 crore out of the ₹97 crore allocation made in this financial year’s estimates. Similarly, the SEED scheme’s allocation has been maintained at around ₹40 crore for the year even though the department was able to spend just ₹15 crore on it.

As for the Tribal Affairs Ministry, despite being able to spend just ₹2,471.81 crore out of its ₹5,943 crore allocation for this fiscal on its flagship EMRS project, the Ministry has set aside ₹6,399 crore for this project to be spent over the next fiscal. The PM-JANMAN programme targeted towards the Particularly Vulnerable Tribal Groups (PVTGs), launched in November, 2023, saw an allocation of ₹240 crore under the transfers to States head, with a ₹25 crore allocation for the Central sector component of it under the Tribal Affairs Ministry. Apart from this, ₹1,600 crore has been set aside to be disbursed as grants under Article 275(1) of the Constitution for the welfare of Scheduled Tribes.

In addition, the government has reduced the allocations for FY 2024-25 under the Free Coaching Scheme for Scheduled Castes and Other Backward Classes by over ₹12 crore; the allocation for the Pradhan Mantri Janjatiya Vikas Mission (PMJVM) — for forest produce self-help groups (SHGs) — also saw a reduction of over ₹110 crore compared to the FY 2023-24 estimates. Further, the allocation under transfers to States for the PM Adi Adarsh Gram Yojana has gone down by over ₹400 crore.

Furthermore, the government has made sure that there is a marginal increase in the overall allocation for the pre- and post-matriculation scholarship schemes (all components put together) available for Scheduled Castes, Scheduled Tribes, Other Backward Classes, and Denotified, Semi-Nomadic, and Nomadic Tribes — both in its share and in the share meant to be transferred to States and UTs.

As part of the Interim Budget documents, the government also put out a table on the implementation progress of significant announcements made in the 2023-24 Budget speech. Among these, the Sickle-Cell Elimination Project’s progress has been slow, with just a little over 64 lakh screenings conducted till November 2023, out of a target of conducting over two crore by the end of the fiscal.

Under the PM-JANMAN scheme, the government said that shared databases had been set up to collect village-level population data of PVTG communities, and that a mobile app had also been created by the Bhaskaracharya National Institute for Space Applications and Geoinformatics (BISAG-N) for verifying PVTG population, village data with infrastructural gaps in these villages/habitations.

Further, the government had announced a plan to hire as many as 33,000 teachers and non-teaching staff for EMRSs. Of this, the first batch of over 10,000 staff members are set to be selected for postings by the end of the fiscal. The exam for this selection was conducted in December, 2023.

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2024 Interim Budget | Allocation for Minority Ministry remains same

admin — Thu, 01 Feb 2024 16:28:46 +0000

Union Finance Minister Nirmala Sithaman addresses the press conference after presenting the Union Interim Budget 2024 at Parliament, at the National Media Centre, in New Delhi on Thursday.
| Photo Credit: ANI

The Budget Estimate for the Union Minority Ministry remain almost unchanged with marginal increase for a couple of schemes and programmes. The budget allocation for the ministry has been increased from ₹3,097.60 crore in the financial year 2023-24 to ₹3,183.24 crore for 2024-25.

The Revised Budget for the Minority Ministry in 2023-24 was ₹2,608.93 crore.

Budget 2024 updates

The budget for Quami Waqf Board Taraqqiati Scheme and Sahari Waqf Sampati Vikas Yojna, was ₹17 crore in 2023-24, while the Revised Budget remained ₹8 crore. The government still allocated ₹316 crore for the same in the financial year 2024-25. These schemes are meant to implement the Computerisation of Records, Strengthening of State Waqf Boards and to protect vacant urban Waqf land from encroachers apart from developing it on commercial lines for generating more income in order to widen welfare activities, respectively.

The budget for total education empowerment of minorities was slightly decreased, nearly ₹125 crore, reportedly due to cancellation of scholarship schemes like pre-metric as well as the Maulana Azad National Fellowship (MANF).

The Right to Education Act (RTE Act) covered compulsory education up to Class 8 for all students which is why the pre-metric scholarship was cancelled, said the government in its response in Parliament. The scheme in its new form only covers students of Classes 9 and 10. Smriti Irani, Minister for Minority Affairs, had told the House that the MANF was scrapped as it overlaps with various other fellowship schemes for higher education implemented by the government which also covers students from minorities.

Also read: Key takeaways from interim Budget 2024-25 in charts

The Education Scheme for Madrasas and Minorities has been slashed to ₹2 crore from ₹10 crore in the last budget. The revised budget in the category was ₹5 crore.

The allocation of ₹910 crore has been made under the Pradhan Mantri Jan Vikas Karyakaram (PMJVK), which was ₹600 crore for 2023-24. The objective of the PMJVK is to address the development, deficits in the selected Minority Concentration Areas (MCAs i.e. identified districts headquarters blocks/towns/clusters of villages having substantial minority population which are relatively backward). The Multi-sectoral Development Programme (MsDP) has been restructured and revamped for implementation as the Pradhan Mantri Jan Vikas Karyakaram.

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2024 Interim Budget | Government to consolidate the demand of three Services in defence allocation

admin — Thu, 01 Feb 2024 15:07:07 +0000

In a significant measure to bring jointness in the procurements of the armed forces, the Government has decided to consolidate the demand of the three services in the capital head of the defence budget based on similar items of expenditure such as land, aircraft and aeroengines, heavy and medium vehicles among others. In the interim budget presented by Finance Minister Nirmala Sitharaman, there was no significant change in the allocation for defence with the total allocation for the Ministry of Defence (MoD) stands at ₹6.2 lakh crore for 2024-25.

“This will bring flexibility in financial management by enabling the MoD to reappropriate the fund among the three services keeping in view the inter services priority. This mechanism will also expedite decision making and ensure better utilisation of the capital budget,” the MoD said in a statement.

Budget 2024 updates

This is a significant measure towards bringing in jointness in procurements among the three services and addresses the shortfall often faced between committed liabilities, milestone payments to be made for past deals, versus the allocation for each service which was faced by Navy and Air Force in the past. For major capital procurements, the authority to prioritise is the Chief of Defence Staff and once cleared is sent to Defence Acquisition Council for approval.

The allocation of ₹6.2 lakh crore is 4.72% higher compared to the Budget Estimates (BE) and marginally lower, -0.38%, than the Revised Estimates (RE) for 2023-24 and is 13.04% of the total Union Budget presented. Of this, 27.67% goes to capital, 14.82% for revenue expenditure on sustenance and operational preparedness, 30.68% for pay and allowances, 22.72% for defence pensions and 4.11% for civil organisations under MoD. The capital allocation, which is for new procurements, stood at ₹1.72 lakh crore, 5.78% higher than the BE of last year.

Budget data shows that from BE to RE of 2023-24, Defence Ministry returned ₹5,371.8 Crore from the capital component while it received an additional ₹28,548.61 Crore under revenue expenditure, other than salary, meant for sustenance and operational commitment. For FY 2024-25, the revenue allocation, minus pay and allowances, is ₹92,088 crore which the Ministry said is aimed at providing best maintenance facilities and support system to all platforms, including aircraft and ships. It also facilitates procuring of ammunition, mobility of resources, movement of personnel, catering to day-to-day expenditure of armed forces in strengthening the deployment in forward areas and keeping the forces always ready to take care of any eventuality, it stated.

Ms. Sitharaman in her budget speech announced a new scheme for development of deep tech for defence purposes. On this the MoD stated, “The announcement regarding a ₹1 lakh crore corpus for Deep Tech for long term loan to tech-savvy youth/companies and the tax advantage to the start-ups will give further impetus to innovation in the defence sector.”

On the capital allocation, the Ministry said that this was in line with the Long Term Integrated Perspective Plan (LTIPP) of the three Services aimed to fill the critical capability gaps through modernisation of the armed forces by “materialising some big ticket acquisitions in FY 2024-25.” The enhanced budgetary allocation will facilitate in equipping the armed forces with state-of-the-art, niche technology lethal weapons, fighter aircraft, ships, platforms, Unmanned Aerial Vehicles and specialist vehicles, it stated.

Planned modernisation of existing Su-30 fleet along with procurement of 12 more aircraft, acquisition of new engines for MiG-29 jets, C-295 transport aircraft under induction and missile systems will be funded out of the budget being allocated, according to the MoD. “Apart from this, to take the initiative of ‘Make in India’ further the Light Combat Aircraft (LCA) MK–I IOC/FOC configuration will be additionally funded to ensure state-of-the-art technology in domestic production. The Indian Navy projects such as acquisition of deck-based fighter aircraft, submarines, next generation survey vessels etc. will all materialise through this allocation.”

Also Read | Interim Budget 2024: Highlights

Infrastructure

Referring to the allocation for Border Roads Organisation (BRO), the Ministry referred to the “continued threat perception” faced at the India-China border, and said there continues a jump in the capital allocation. The allocation for BE 2024-25 is ₹6,500 crore, which is 30% higher than the allocation for BE 2023-24.

“The financial provision made during the budget this year, will, apart from promoting strategic infrastructural development in the border areas, also boost socio-economic development in that region along with promoting tourism,” it stated. Projects such as development of Nyoma air field in Ladakh at an altitude of 13,700 feet, permanent bridge connectivity to southernmost Panchayat of India in Andaman and Nicobar island, 4.1 km strategically important Shinku La tunnel in Himachal Pradesh and Nechiphu tunnel in Arunachal Pradesh are among the projects that would be funded out of this allocation.

Defence budget Estimates 2024-25

Total allocation for defence has gone up to ₹6.2 lakh crore

Revenue allocation: ₹2.83 lakh crore

Capital: ₹1.72 lakh crore

Pensions: ₹1.41 lakh crore

Civil: ₹25,563 crore

Compared to BE of 2023-24: 4.72%

Compared to RE of 2023-24: -0.38%

Defence budget points:

Total allocation for defence ₹6.21 lakh crore, 4.72% more than BE of 2023-24. This is 13.04% of total Union Budget presented by Finance Minister Nirmala Sitharaman

₹1.72 lakh crore – 27.67% of total defence budget – allocated for capital acquisition

Budget to armed forces for revenue expenditure (Other than Salary) stands at ₹92,088 crore

₹6,500 crore earmarked to strengthen border infrastructure;

₹7,651.80 crore allocated to Indian Coast Guard;

allocation to DRDO at ₹23,855 crore

FM announced a new ₹1 lakh crore corpus for Deep Tech for long term loan to youth/companies

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Honourable mention for bioeconomy in Interim Budget, with trillion-dollar potential in mind

admin — Thu, 01 Feb 2024 14:08:46 +0000

Union Finance Minister Nirmala Sitharaman addresses the post-Budget press conference, in New Delhi, Thursday, Feb. 1, 2024.
| Photo Credit: PTI

In her speech for the 2024-2025 Budget, Finance Minister Nirmala Sitharaman spoke of “a new scheme of bio-manufacturing and bio-foundry” to provide “environment-friendly alternatives such as biodegradable polymers, bio-plastics, bio-pharmaceuticals and bio-agri-inputs”.

The announcement is part of a bid to have the bio-economy contribute $300 billion to the Indian economy by 2030, representing a jump of around ₹18 lakh crore in value from current levels, and $1 trillion by 2047. The products of the bio-economy also play key roles in India’s sustainability and ‘green’ economy targets.

Budget 2024 updates

“The way to upskill India’s bio-science sector is to put money into bio-manufacturing and not only prioritise research,” Shambhavi Naik, a researcher at The Takshashila Institution, said.

In the 2024-2025 Budget, the total allocation for the Department of Biotechnology (DBT) has been cut by 16%, to ₹2,251.52 crore, potentially slowing its recovery from the highs of the COVID-19 pandemic, when it helped develop vaccines, to the pre-pandemic level.

Also read: Key takeaways from interim Budget 2024-25 in charts

The Biotechnology Industry Research Assistance Council (BIRAC), a public-sector enterprise under the DBT that interfaces between academia and industry, has also been allocated what it was in 2023-2024 — ₹40 crore — even though its actual expenditure was higher.

The bio-economy refers to all economic activities that use biotechnologies to produce value, and includes vaccines, diagnostics, bio-ethanol, bio-plastics, genetically modified crops, etc. According to the latest Indian BioEconomy Report (IBER), published by BIRAC in 2023, “The [Indian] innovation ecosystem continues to flourish, and we aspire to become one of the top 5 global bio-manufacturing hubs and among the top 10 biotechnology destinations globally.”

The new bio-manufacturing scheme “will also help in transforming today’s consumptive manufacturing paradigm to the one based on regenerative principles,” Ms. Sitharaman added.

Also read: Where does the money come from and where is it allocated?

“Apart from the faux connection that increased supply will change consumption, the initiative is much needed,” Ms. Naik said. “As with any initiative, it will depend on what the initiative will do. It is not only about the money and tax breaks, but we need to focus on two pivotal things: creating appropriately trained workforce for bio-manufacturing and accessing the appropriate raw materials.”

Considering the existing gap in vocational training, the country currently has “highly paid Ph.Ds or low skilled BSc/MSc” graduates, Ms. Naik said. “We have for a long time now recommended an accreditation course for bio-manufacturing.”

The 2023 IBER report identified many opportunities to boost bio-manufacturing in the country, including a $2 billion investment to help start-ups transition to “large-scale manufacturing”, introducing a production-linked incentive scheme to improve production, and instituting a single-window clearance system for bio-manufacturers.

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Committee will study ‘fast population growth’ and demographic changes: Nirmala Sitharaman

admin — Thu, 01 Feb 2024 13:43:09 +0000

Finance Minister Nirmala Sitharaman’s announcement comes against the backdrop of an indefinitely postponed Census, which means that there is little reliable data to back up her assertion of “fast” population growth in the country.

Interim Budget 2024

A high powered committee will be constituted to consider the challenges arising from “fast population growth and demographic changes”, Finance Minister Nirmala Sitharaman said in her Interim Budget speech on Friday. She added that the committee would be mandated to make recommendations to comprehensively address these challenges in relation to the goal of Viksit Bharat, or a developed India.

Her announcement comes against the backdrop of an indefinitely postponed Census, which means that there is little reliable data to back up her assertion of “fast” population growth in the country; the little data that exists suggests that the country’s fertility rate is, in fact, falling below replacement levels. Despite the absence of sound statistics, security concerns in border areas are also being highlighted on the basis of purported demographic changes.

In response to a question from The Hindu on whether the committee announced by Ms. Sitharaman was aimed at population stabilisation and if it would be set in motion after the next Census, Economic Affairs Secretary Ajay Seth said: “India’s demographics are an opportunity as well as a challenge. The committee will look at those aspects and the final terms of reference will reflect the focus.”

Fertility rate dropping

Though the details of the committee are still awaited, the Minister’s speech suggested there has been a “fast” population growth in the country, even though there is no accurate data reflecting such a trend. India has not had a Census since 2011. The latest Sample Registration System (SRS) report for the year 2020 said that the total fertility fate (TFR), or the average number of children born to a woman over her lifetime, has actually dropped to 2, from 2.1 in 2019.

The National Family Health Survey (NFHS)-5 for 2019 to 2021, released in May 2022, stated that the TFR has further declined from 2.2 to 2 at the national level, in comparison to the last such survey held in 2015 and 2016. NFHS-5 said that there are only five outlier States which have a TFR above the replacement level of 2.1 — Bihar (2.98), Meghalaya (2.91), Uttar Pradesh (2.35), Jharkhand (2.26), and Manipur (2.17).

Also read: Key takeaways from interim Budget 2024-25 in charts

According to Sabu Mathew George, a girl child rights activist, the NFHS data does not give a complete picture as its sample size is too low and the survey is spread over many years. “SRS, which is released every year gives us a better statistical picture than NFHS. Notably, the SRS for the year 2020 was published in 2022. There has been no fresh publication since then. The NFHS-5 was conducted over a period of two years and the data cannot be said to be statistically sound,” Mr. George said.

Missing population data

On September 20 last year, Union Home Minister Amit Shah said in the Lok Sabha that the Census and delimitation of parliamentary seats would only be conducted after the 2024 general election, but did not specify the year that the exercise would take place. The Census, that was to be conducted in two phases in 2020 and 2021, has been postponed indefinitely.

The deadline to freeze the administrative boundaries of districts, tehsils, and police stations in States has been extended nine times by the Registrar General of India (RGI) that conducts the Census.

Another key report — ‘Vital Statistics of India Based On The Civil Registration System (CRS)’ — was last released for the year 2020. It has not been published for the years 2021, 2022, and 2023.

‘Essential for transparency’

Mr. George has petitioned the Supreme Court for the timely publication of the report, as it is “essential for transparency and effective demographic research and interventions in socio-economic planning”. The petition is expected to be heard this month.

The activist said that in 2011, the top court had directed all States to publish the data on their website up to the gram panchayat level. “In the case of sex-selective abortions, it was transparency and demographic research that revealed an alarming drop in sex ratios,” the petition said.

Demographic security concerns

At the annual Director General of Police (DGP) conference in 2021, police officers from Uttar Pradesh and Assam submitted a research paper flagging concerns about demographic changes in districts along the international border with Nepal and Bangladesh. The officers highlighted an increase in the number of mosques and seminaries, as well as a high decadal growth in population in these areas.

The Assam police paper said that the decadal growth in population, between 2011 and 2021, within 10 km of the Bangladesh border stood at 31.45%, which is higher than the projected national and State averages of 12.5% and 13.54% respectively.

In November 2021, the then-Border Security Force (BSF) director General Pankaj Kumar Singh had said that demographic changes in certain border districts of Assam and West Bengal could be one of the reasons for the Home Ministry notification issued a month earlier, enhancing the jurisdiction of the BSF upto 50 kilometres from the border. He had said that the 2011 Census reflected the demographic changes and the “demographic balance has changed in Bengal and Assam leading to revolt among the people… voting pattern has changed in the neighbouring border districts … the government thinking was that this notification can help in catching the infiltrators.”

The Uttar Pradesh police paper said that out of 1,047 villages in the seven border districts of Maharajganj, Siddharthnagar, Balrampur, Bahraich, Shravasti, Pilibhit, and Khiri, 303 villages had a Muslim population between 30% and 50%, while 116 villages had a Muslim population of more than 50%.

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