- The FM intends to pump money the Budget in the economy and it obviously comes at the cost of fiscal discipline (Fiscal deficit at 9.5% is above most estimates) but it is understandable as we are living in between the world’s major crisis .i.e, covid -19.
According to the Finance Minister, Nirmala Sitharaman who presented the Budget for the year 2020-2021 said that it was one of the best budget in the record of 100 years if we consider the crisis that our economy is facing. She was very satisfied that she managed the situation of crisis by not thinking about the fiscal deficit pegged at 9.5% of the GDP. Therefore,it signifies that the government is ready to let go there fiscal discipline and permit the deficit for the benefit and betterment of the life of the people in the economy.
And later, the FM announced a new Center-sponsored scheme with an expenditure of Rs 64,180 crore to uplift healthcare infrastructure across the country for social welfare purpose. This will help the population as they can now easily able to afford their healthcare issues. As the healthy population will help more to our economy to achieve, growth and success in long run.
As the budget was preceded by the New Education Policy of 2020. One of the major budgetary allocations is 93224 crores to the Ministry of Education figures. Afcourse it will be as it is dealing with human capital which is one of the pillars of the budget. It is also focused on skilling through the help of various other schemes like joining with UAE and Japan for skill development.
To reduce the fiscal burden on the Exchequer, the highest targeted divestment of 1.75 lakh crore never expected was made due to the crisis. Although the common population has been defended from not being burdened with Covid mess and tax increase in regard of a pre-budget build-up, a cess on Agriculture Infrastructural and Development was announced as well.
As if we focus on the infrastructure sector an 8500 km of new highway projects have been declared in the budget. This will bring a huge opportunity for the economy with big-spending, job creation, money in the hands of the labourer, better transportation in long run etc. cannot be ignored, the government needs to be perfect about the implementation because if these are not executed properly they will not be effective.
Additionally, with time, as the economy builds better or recovers, the fiscal deficit will become as it previously announced to 3% level. The government also take care of a rise in the interest rate that is the other economic fall-out because of much higher borrowings to fund as per the budget plan.
