Union Finance Minister Arun Jaitley outlining the nine priority areas for the government that will transform country in the Union Budget which is no doubt a far sighted move concentrating on boosting infrastructure growth. Budget 2016 outlines several programmes with these nine priority areas as center points and will lay greater emphasis on social sectors, education and skill building and job creation for building a knowledge based and productive economy. The nine priority areas of the government are, agriculture and farmer welfare, rural sector, social sector, education skills and job creation, infrastructure investment, financial sector reforms, governance , fiscal discipline, tax reforms to reduce compliance burden. On the income tax front, the budget has continued with the status quo on the tax slabs while it has given small exemptions. It remains to be seen if Jaitley will loosen his purse strings or continue to consolidate. In the event the government decides to increase spending, it would be a challenge to ensure that the funds are channelised into capital investments. Even if budgetary consolidation continues, India’s fiscal metrics will remain weaker than rating peers in the near term. Rising rural distress because of back-to-back droughts has put considerable pressure on the Finance Minister to spend more on social schemes, while at the same time he has to win back foreign investors craving for faster reforms. Jaitley has shifted the proportion of expenditure towards infrastructure and away from subsidies in the last two budgets. Besides implementation of the Seventh Pay Commission, he also faces challenge of bank recapitalisation. Proposed Health Protection Scheme will greatly benefit the common people of the country. The budget is for everybody. Budget has been provided for infrastructure like ports, rail and airports. In the health sector, for poor people, up to rupees one lakh cost of hospitalisation will be borne by the government. This budget will help India achieve twin objectives of economic growth, equitable distribution of benefits and resources at an accelerated pace. The budget will need to focus on the commodity driven sectors by providing protection measures, since these sectors are stressed due to the collapse in global demand and oversupply.
