Jai Kisan Budget

The Budget this year was watched closely by India and the world. This is the third Budget of the current government and comes after the successful Make In India initiative. This Budget is about getting the basics done in many areas, notably in four areas.

The first and important one is fiscal discipline and reforms in the financial sector. The Finance Minister has stuck to getting the fiscal deficit under control at 3.5 per cent. He has done this while factoring the Seventh Pay Commission and the One rank One Pension outflow. He has also signalled expenditure at ₹19.78 trillion.

Considering a bankruptcy code is a good and welcome move. The recapitalisation provision of public sector banks at ₹25,000 crore will not solve the issue fully but at least gets it started.

The allocation of ₹2.18 trillion for roads and railways is the right move for infrastructure. The idea to use existing disused airports by upgrading them is another good idea to connect the country.

The use of digital technology for land records, for developing e-portals for farmers and breeders is excellent. Integrating Rural India into the mainstream economy has been a challenge due to the physical distance challenges; this is being overcome with digital adoption and inclusion.

The third area is farmers and rural areas. Nine States are in drought this year and addressing that has been a priority. The concept of 100 per cent FDI in retail and marketing of fully India sourced food, fruit and vegetables will help develop the value chain in the food industry. The plight of farmers affected by the weather elements is being addressed through a ₹9 trillion calamity fund.

The digitisation of land records will be a long but correct journey. The 100 per cent electrification of all villages by May 1, 2018 is another positive move. The allocation of ₹2.87 trillion for gram panchayats is taking empowerment right to the last level of governance. The vision of doubling farmer incomes by 2022 is good news for a consumption society.

The fourth area is the creation of jobs. The government clearly recognises the importance of creating a million jobs every month. The EPF contribution in the case of new employees for the first three years is novel. The idea of setting up a national career service centre will help millions of youth. The finance minister clearly recognises the important job generation potential of the retail industry with its 15 million store footprint. The retail industry is the largest services employer in India and allowing small and medium retailers to choose a 24 x7 business hour cycle voluntarily helps generate many jobs in this sector.

This is a different direction for a different India. The Finance Minister has also given tax breaks for the first three years for new manufacturing units, following up on the Make In India agenda. This is an almost ‘must happen initiative’ for the government and society. The Finance Minister has clearly focused on getting the rural sector growing again.

Agriculture accounts for 17 per cent of the GDP but accounts for 47 per cent of all workforce. This Budget has tried to set a number of the basics going for the rural market.

The amnesty scheme is another step to get to better governance. Amnesty schemes have not really delivered in the past when offered or did not realise their full potential. Will this amnesty scheme be different? No budget ever pleases every stakeholder. The finance minister has tried his best. He has tried to balance the most urgent needs of the country with pragmatic fiscal discipline..

The writer is Chairman and CEO, Pepsico India

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