A please-all Budget has no big idea

The Budget was populist in nature and focused on farmers, informal sector workers, and the middle class.

Assured income for farmers

The Budget, which was expected to have something substantial to offer to the agricultural sector, announced an assured income scheme wherein 12 crore small and marginal farmer families will receive Rs 6,000 per year. The ‘Pradhan Mantri Kisan Sammaan Nidhi Yojana’, which envisages direct cash support to farmers with up to 2 hectares of cultivable land, had a Rs 75,000 crore outlay for FY20. Additionally, there were some measures to help farmers get timely credit for cultivation besides fund allocations for rural development, like building roads and homes.

While all these measures are welcome, the Budget did not have anything in it to push agri-technologies that enable transparent price discovery in commodity markets, as well as help farmers, increase crop yields.

Pension for informal sector

The pension scheme for workers in the informal sector, ‘Pradhan Mantri Shram-Yogi Maandhan’, is welcome as it will provide a social security net for nearly 10 crore Indians. It will also be the first step towards generating formal data on the kind of jobs being created in this sector.

Cheer for taxpayers

The Budget sought to woo the middle class as well by offering a full Income Tax rebate for up to Rs 5 lakh and hiking the standard deduction to Rs 50,000 from Rs 40,000. Higher disposable income thanks to these measures are expected to boost urban demand, which augurs well for overall economic revival.

Fiscal discipline maintained

The government also did well to balance the populist tone of the Budget by signalling its commitment to stick to the road of fiscal discipline, pegging the fiscal deficit at 3.4% of GDP, slightly higher than the targeted 3.3% for FY19.

Some miss

The Budget could have done more to strengthen the existing Startup ecosystem. It was disappointing to see that the startup sector did not receive any relief in terms of a 10-year tax holiday for angel investors. The Budget also failed to announce GST exemption on drugs to treat cancer, which is an urgent need given the huge disease burden that India faces.

Overall, it was a please-all Budget that tried to address various stakeholder groups in the run-up to the elections without unveiling any big idea.

(The writer is Chairperson and Managing Director, Biocon Limited)