The last full-fledged budget of the Narendra Modi-led government and the first one after GST rollout is much anticipated. With the day finally arriving today, speculation about Union Budget 2018 is rife across the country. Various sectors such as e-commerce, health, agriculture, education, Information Technology (IT), and manufacturing among others expect major policy initiatives which will drive growth and support development and expansion.
Here are a few sectors which will most likely benefit from Union Budget 2018:
- Union Budget 2017, the first budget post demonetisation, boosted digital operations and transactions in the country. With the 'Digital India' initiative, high on Prime Minister Narendra Modi's agenda, Union Budget 2018 too, is expected to give a major push to digitization.
- Industry experts also believe that the budget will focus more on the rural distress. Job programs, irrigation projects, and improvement of health infrastructure in rural India is expected to get a push.
- The previous Budgets presented by Finance Minister Arun Jaitley have been all development oriented. One can expect the same from Union Budget 2018 as well. Employment-intensive sectors will most likely be boosted. And since the MSME sector in India plays a crucial role in providing large-scale employment at a comparatively lower capital cost; new schemes and initiatives can be expected.
- In Budget 2018, the government may reportedly also tweak income tax slabs and rates. Multiple deductions might be replaced with a standard deduction to reduce the tax burden on consumers.
- Union Budget 2017 saw the merger of the Railway Budget with the General Budget. Further, Economic Survey 2017-18 stated that during 2017-18 (up to September 2017) the Indian Railways carried 558.10 million tonnes of revenue earning freight traffic as against 531.23 million tonnes during the corresponding period of previous year, showing an increase of 5.06 percent during this period. It is expected that Union Budget 2018 will lay emphasis on railways infrastructure development.
- The Economic Survey 2017-18 focused on the need to address the issues of pendency, delays and backlogs in the appellate and judicial arenas towards Ease of Doing Business. These issues, it said hamper dispute resolution and contract enforcement, discourage investment, stall projects, hamper tax collection, stress taxpayers and escalate legal costs. The survey emphasized the importance of an effective, efficient and expeditious contract enforcement regime for economic growth and development. Budget 2018 is expected to provide a way out.
- Controlling inflation has been a priority area for the Modi-led government. And the government has taken a number of measures for this purpose in the past. From regular review meetings on prices and availability to the implementation of Price Stabilization Fund (PSF), strict measures have been taken to control inflation numbers. Budget 2018 is expected to do just the same.
- The Economic Survey also pointed out that low level of tax collections by the local governments in rural areas is posing a challenge in reconciling fiscal federalism and accountability in the country. Unlike in other countries, reliance on direct taxes in India seems to be declining, a trend that will be reinforced if the Goods and Services Tax (GST) proves to be a buoyant source of revenue. Budget 2018, among other things, will extensively look to stabilise GST in the country.
On a related note, with this budget, Arun Jaitley has joined an elite group of finance ministers who have had the opportunity to present the Union Budget over five times.
Yashwant Sinha, P. Chidambaram, and Pranab Mukherjee have all presented the budget five or more in the Parliament.