The Union Budget for upcoming financial year 2023 -24 was Presented in Parliament by Union Finance Minister Mrs. Nirmala Sitharaman on 1st February 2023.
The Union Budget is officially Known as Annual Financial Statement. The term Budget is not mentioned in Indian Constitution. In Fact , in Indian Constitution under Article 112 there is the Provision of Annual Financial Statement which refers to the estimated Receipts and estimated expenditure of the Government for a Particular Fiscal Year ( Here fiscal year 2023-24 ).
The Union Finance Minister has presented the Economic Survey for fiscal year (2022-23) on 31st January 2023. Post this on dated 1st February the Budget for fiscal year 2023-24 was tabled in Parliament.
The Budget would come into effect from 1st April 2023 (Fiscal year 2023-24) only after it gets Passed in the Parliament with Simple Majority. Like Economic Survey , Budget is also Prepared by Department of Economic Affairs , Ministry of Finance.
Union Budget
- Revenue Budget
- Capital Budget
The Union Budget is divided into two Parts Revenue Budget & Expenditure Budget. Revenue Budget refers two both the source of Revenue for Government (Direct & Indirect taxes, other revenues ) and Revenue Expenditure ( Expenses that is mandatory and cannot be avoided like salary, Interest Payment, Subsidy and other Expenditures).
On the Other hand Capital Budget is all about investment in creating Infrastructure (like Building Roads, railways, Power & other Assets etc. ) which is long term investment and is going to give return after some years while it influences the Commercial Activities to a great extent as it Provides Employment to People and various stock holders as the Projects works begin.
While Preparing Budget there are several key factors that are kept in mind. The Budget for 2023-24 has been based on Saptarishi (Seven Key Priorities) that is going to guide India through the Amrit Kaal. Through these initiatives India is aspiring to be in the list of Developed Economy by 2047. The Seven Priorities (Saptarishi) includes: -
- Inclusive Development – It refers to that economy where everybody contributes something in the development of Country and no one left apart. It takes into consideration the Participation of all citizens irrespective of gender , caste , class & skill.
- Reaching the last Mile – The Government is trying to include those sections which had remained aloof from the Inclusive Development. Those who are capable and willing to contribute but could not do so due to some problem. Through certain Policy those sections of People (Impoverished, Tribals other backward communities) would be made part of the Development. Through this Government wants to ensure the benefit of development to the last citizen of the Country as well.
- Infrastructure & Investment – For every Developing Economy investment on Infrastructure is inevitable. Infrastructure refers to good Roads (to have efficient robust surface Transport), Power & Energy (Electric Generation Plants ) and investment on Educational Institutions , Hospitals and others. A total fund of Rs. 13 trillion has been the effective Capital expenditure for the Fiscal year 2023-24.Capital Expenditures Promotes growth as it helps in reducing logistical cost , Private Investment increases in Economy. Under Infrastructure Rs. 2.4 trillion allocated for Railways, Rs 2.7 trillion for Roadways, Rs. 1.9 trillion for Electricity in the Budget announced for Fiscal Year 2023-24.
- Unleashing the Potential: Under this the Government has allocated certain funds for technology like Artificial Intelligence, 5G & Fintech Services, Center of Excellence for AI. This technology will help in modernizing the Agriculture by Precision
- Green Growth: Rs 19800 Cr has been allocated to Produce 5 MMT of Green Hydrogen. Such energy is best for Environment and it will also reduce India’s dependency on Fossil fuels to some extent. The Budget says India has to achieve net Zero Carbon emission by 2070. Certain other initiatives have been taken to ensure this target like 50 % energy through renewable source, reducing carbon emission up to 1 billion tons by 2030. Under this Priority of the Government, certain funds have been allocated in the Budget for giving loans for Development of Environmental Friendly Projects like Bharat Prakritik Kheti, Vehicle Scrapping Policy and various others
- Youth Power: 47 lakh youth will be chosen for stipend-based Training Programs Under National Apprenticeship Promotion schemes. The Government has also put emphasis on Tourism as it being the major source of Employment generation from unskilled to skilled workforce. Through the Budget the Government has put emphasis on skill training to youth as per the requirement of 4th Industrial Revolution which can be attained through AI, Robotics, IOT, 3 D printing, Skill India Digital Promotion.
- Financial Sector: Credit guarantee for MSMEs in order to revamp Credit scheme and provide collateral free loan of up to 2 Cr to MSMEs. Under Collateral free loan, Government becomes the Guarantor. Certain other provision pertaining to Financial Sector Regulations, Central Data Processing were covered in the Budget.
The Union Budget (2023-24): The Key highlights of the Budget is as follows –
- Economic Empowerment of Women through Self Help Group: Women Empowerment has remained key area of this Budget. Through 81 lakhs SHGs (Self Help Group) Government wants to ensure the empowerment of women. These SHGs would be supported by Government so that these becomes the large Enterprises. The Deen Dayal Antyodaya yojana had mobilized Rural women into these SHGs.
- Presently the Percentage of Women Participation in Economic activities has not been Satisfactory. The SHGs would enable more participation of women in economic activities in both Rural & urban areas. This will eventually empower women with respect to their economy as well.
- Capital Expenditure: The Fund allocated for Capital Investment is Rs. 10 lakh Cr which shall account for 3.3 % of GDP. The Government is concerned about Infrastructure Development as it has implications for growth. In fact, investment on Infrastructure such as Roads gives return in long term which is about three times the amount invested. There are two sources for Capital Expenditures – one is Budget & the other is Internal & Extra Budgetary Resources of Public Sector Enterprises.
- Mechanical Scavenging: -- Government wants to ensure 100 % Mechanical Scavenging. It will Prevent loss of life in manual scavenging.
- MSMEs (Micro, Small & Medium Enterprises): This Sector is very significant for Indian Economy as it has 29 % contribution in India’s GDP and more than 12 Crore People are engaged or employed in this Sector. The fund of Rs. 9000 Cr has been allocated for MSMEs in the Budget to revamp the Credit Guarantee Scheme. It will be effective from 1st April 2023.
- It will enable additional collateral free Guaranteed Loan of Rs. 2 Cr, eventually cutting the cost of Fund by 1 Percent.
- A fund of Rs.15000 Cr has been allocated for improving the socio-economic condition of 75 Particularly vulnerable Tribal Groups under PM Particularly Vulnerable Tribal Group Development Mission.
India which is the fifth largest economy in the world , third with respect to Purchasing Power Parity; certain Provisions of Empowerment of women , fund allocation for MSMEs, Inclusive growth will help in boosting the economy and will fulfill the Dream of being in the list of Developed Country by 2047.Huge Investment under Infrastructure Promotes Production Capacity but in addition to it certain structural reforms pertaining to Labor Reforms, Land acquisition , skill Training, Environmental Protection & Intellectual Property rights will enable the Proper growth to happen.
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