'Budget will balance and empower economy in long run'

By Anshuman Magazine

“The government has announced a progressive budget which will go a long way in creation of a well-balanced and empowered economy. The Finance Minister Ms Nirmala Sitharaman in her first ever budget presentation struck a fine balance between ease of doing business and ease of living in the country. While expressing confidence that the size of our economy will touch USD 3 trillion by end of the present financial year, she also expressed hope that we will be able to become a USD 5 trillion economy (world’s 3^rd largest) by 2024-25. She also recognised and appreciated the role played by India Inc in driving the self-sufficiency goals of the country and being a partner in achieving national goals related to employment generation, wealth creation and sustained growth.

The allocation of Rs 100 lakh crores for infrastructure development in the next five years is a move in the positive direction. Increased allocation for the development of railways, ports, roads, aviation and intra-city networks such as metro rail, will strengthen the overall infrastructure fabric of the country. In particular, its commendable that the government has paid due emphasis to further empower the rural economy. The FM specifically mentioned the requirement for investing in rural road infrastructure, connectivity and rural housing and promised construction of 1.95 crore rural homes by 2022 under the government’s Housing for All scheme and equipping these homes with toilets, electricity and LPG connections.

On the housing front, an additional deduction of Rs 1.5 lakh has been proposed on interest paid for affordable housing loans till March 2020. A model rental tenancy law will also be established to enhance the rental housing market. These measures, besides sustained investment in the Pradhan Mantri Awas Yojna will continue to support the housing market in the country.

On the shadow banking sector, the government maintained a fine balance between ensuring liquidity and enhancing scrutiny. Placing housing finance companies under the ambit of the RBI and incentives such as credit guarantees for NBFCs will provide a relief to this sector.

Other key steps such as easing sourcing norms for single brand retail, enablers for start-ups, proposed revision of labour laws, enhancing FDI limits for sectors such as aviation, promoting skill upgradation and focusing on the improvement of foreign investor confidence will strengthen both ease of doing business and ease of living in the country.

While several measures have been announced by the Finance Minister to attract greater investments from all possible routes, the actual impact will be realised only post their effective implementation. It definitely provides a good opportunity for all stakeholders to come together and move towards common goals.”

The author is Chairman and CEO, India, South East Asia, Middle East and Africa, CBRE.

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