The budget for 2022-23 shows that the government has decided that the budget speech is not the occasion to make ‘big-bang’ announcements. Instead, the budget should signal stability and predictability of policies. This is a welcome change. 

The government had last year decided that large investments in infrastructure was the way to take the economy forward and create jobs. This strategy has worked very well and this year the outlay has been increased by 35.4 per cent to ₹ 7.5 lakh crore. As the finance minister said, this along with the investments to improve logistics, will help in increasing productivity, lowering costs of doing business and making India more competitive. While this is undoubtedly true, what is most heartening is to hear the Finance Minister use this language. She also talked of a trust-based government. The sooner these sentiments are understood and acted upon by the bureaucracy the faster India will move. 

Last year it was accepted that privatisation of government enterprises would be accelerated. Several big ticket privatisations were taken up and Air India has been sold. However, there are delays in several cases. It seems that there is need to review and improve processes, and perhaps some rules, so that this important programme, essential for increasing competitiveness, can meet targets in future.

The role of the private sector in creating a fast growing and competitive economy was very clearly recognized along with the privatisation programme. For several years the government has been implementing reforms designed to make it easier to do business and reduce costs of production. It was apparent from the budget speech that private sector competitiveness is very much in the mind of government. The entire government machinery, and particularly in the States, needs to make this happen. 

Tax rates have remained unchanged but several simplifications and rationalisations have been made. The introduction of a provision under which a person can file a corrected return within two years will not only reduce litigation but also bring in greater transparency. The changes proposed in the system for filing appeals in tax matters will certainly reduce litigation considerably and the costs. 

E-passports, speedier payment systems and expanding digital working will all make for greater transparency and ease of working.

The fiscal deficit is under control and is projected to reduce to 6.4 per cent in 2022-23. The GST system is working well with record collections in January 2022. It seems that the initial difficulties have been sorted out and the time has come for reviewing the system and further simplifying it.

The defence production sector is moving toward greater openness. Private industry will be encouraged to take part in R&D work. 68 per cent of the defence budget is earmarked for domestic procurement. Industry needs to examine how it can quickly improve quality and technology levels to global standards, and in particular help the MSMEs upgrade their systems.

The government has recognised crypto currencies and the RBI will introduce a digital Rupee. We have to see how this affects industry and business and the common man. The telecom sector will witness the introduction of 5G technology and that will make a difference. 

The government is committed to improving the lives of the weaker sections. Economic growth has to be more inclusive and people at large must experience the benefits of industrial growth and better infrastructure. The past policy of largely relying on doles to help the weaker section did not yield the desired results. The government’s approach of providing concrete benefits like supply of cooking gas, construction of toilets, electrification, supply of clean drinking water, affordable housing, and access to the banking system has been more effective. The budget makes provisions for continuing these programmes. At the same time, accelerating manufacturing growth will also create jobs both in the manufacturing sector as well as in the services sector and that will help inclusive growth progress faster. 

The Finance Minister and the government need to be complimented for changing the approach to the budget presentation, and signalling stability and predictability. The markets have appreciated the way the budget has been framed and presented and FY 23 should deliver results in terms of faster growth and greater inclusivity. 

RC Bhargava is Chairman, Maruti Suzuki India Ltd

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