28 February 2015, New Delhi: Welcoming the first Budget of Modi Government, FICCI President Dr. Jyotsna Suri said “This budget has laid down the road map for taking India to double digit growth. We not only see a clear direction in which the economy is going to be steered but also the key milestones that we need to cross on the way. There are several positives not just for the industry but for every section of society. FICCI compliments the Finance Minister for his foresight and for presenting a highly progressive and visionary budget anchored on reforms in an array of areas.”
- There has been a clear commitment towards better targeting of subsidies and the Finance Minister has indicated further scaling up of the Direct Benefits Transfer scheme.
- Creation of a unified national agriculture market has been talked about. FICCI too has been advocating this for long as the agriculture sector is one of the most fragmented sectors in the economy. Move towards a single national market for agri-produce will help rein in the inflationary pressure in case of food commodities as well as provide better prices to farmers for their produce.
- MSMEs have been the backbone of the Indian economy and these too came in for special support in the budget. To tackle the problem of long receivables realisation cycle of the MSMEs, an electronic trade receivables discounting system (TReDS) has been established. The related move of setting up of the Micro Units Development Refinance Agency (MUDRA) bank will help meet the funding requirements of micro enterprises in the informal sector and provide a boost to entrepreneurship.
- The much needed comprehensive bankruptcy code will be introduced in fiscal year 2015- 16. This is another important measure in improving the ease of doing business in India.
- For the first time we see several steps being taken towards creating a universal social security system for all Indians which will lay the foundation for a more confident society.
- A national investment and infrastructure fund has been set up in the form of a trust to raise debt funding in various forms and in turn invest as equity in infrastructure finance companies. This would be an additional avenue to support infrastructure financing and hopefully lessen some of the pressure on the public sector banking system.
- The new Atal Innovation Mission to be housed in NITI Aayog will provide support to the Make in India program and help Indian industry climb up the technology ladder.
- The budget for the first time has also announced several measures to monetise gold. FICCI had recently submitted a report on this subject and we are happy to note that some of the suggestions contained therein such as developing an Indian Gold Coin, having a Sovereign Gold Bond and revamping the Gold Deposit and Gold Metal Loans scheme have been taken up by the government. These measures should help in more effective utilisation of domestic gold reserves through recycling and thus help reduce the imports of gold that have put pressure on the current account in the past.
- Another major item in the budget is the announcement of introducing a new comprehensive law on black money held abroad along with a new and more comprehensive benami transactions (prohibition) bill to curb domestic black money.
- Continuing with the government’s efforts to improve tourism sector in the country that is a major employment generator, the budget provides for resources for up-gradation of facilities at select cultural world heritage sites in India as well as extension of Visa on Arrival facility from the present 43 countries to nearly 150 countries in a phased manner.