INTERIM BUDGET 2024 : FEW OBSERVATIONS

As the Loksabha election is due  leading to the formation of  a new Government, in the meantime the revenue and expenditure activities of the Government should continue uninterrupted for which the Interim Budget is  presented.It  provides budgetary revenues and expenditures for the smooth functioning of the Government till a new Government takes charge immediately after the forthcoming elections.Eventhough technically speaking it is an vote of account government's use it as an opportunity to state their achievements and outline the prospects for future Government. Further as claimed by the Government the budget marked a milestone in India's journey towards a developed country by 2047with continued focus on leveraging technology as the backbone of transformation. Availabilty of Digital public infrastructure and the use of technology and  digital platforms have been the common thread of all reforms. Digitalisation has led to substantial progress not only in financial inclusion but also to provide economic opportunities for every strata of society. 

. The focus as stated by the Finance minister would be on four segments namely Garib(poor),yuva ( youth)Annadata (farmers) ,and Mahila(women) and the next five years will be years of unprecedented development and golden moments to realise dream of developed India by 2047. Accordingly the interim budget 2024 has projected nominal GDP ( Gross  National Product) of ₹327.7 trillion indicating 10.5 % increase from ₹ 296.6 trillion in the current fiscal year 2023-24 .As per the interim budget 28 percent of its reciepts come from  borrowings followed by income tax 19,Goods and services Tax 18 corporate tax 17,Customs duty and Excise 9 and other sources 9 %.On the other hand government's expenditure- 20%  goes on loans and interest payments,10% on pensions and subsidies 8% on defence,  22% on finance commission transfers and 24% on Government Schemes.1The revised estimate for 2023-24 also indicated that the fiscal deficit or the difference between Government earnings and Government expenditure.is expected to be at ₹17.35 trillion or 5.8 % of the GDP In 2023- 24. it is projected  to decline further to ₹16.85 trillion or 5.1% of GDP in 2024-25.Government further aims to reduce it to lower than 4.5 % by 2025-26.With regard to total Government debt owed to its lenders as on 2024 March the debt and liabilities are expected to reach ₹ 168.72 trillion or56.9 % of GDP. .In the case of Direct Taxes- The personal income taxes are expected to reach ₹11.56 trillion or 3.5% of GDP against  corporate income taxes of ₹ 10.43 trillion or 3.2% GDP. Similarly  Government intends to collect GST  ₹ 10.68 trillion or 3.3% of GDP  which includes Central GST and states GST .The revenue estimates appear to be more realistic with  a tax buoyancy of 1.1 and growth of tax revenue at 11.62 %.Various measures adopted in recent years including Digitalisation in a big way, permitting filing of updated returns., use of Annual  information Statement (AIS)and simplification and rationalization of tax rates and new tax regime were responsible for increase in personal income tax revenues. 

As per welfare programs In the housing sector a new scheme is to be launched to help deserving sections of the Middle class living in rented  houses,or slums,and unauthorized colonies to buy or build their own houses.Rooftop solarisation will be enabled to  one crore households to attain upto 300 units of free electricity every month.Two crores more houses will be taken up in the next five years to meet the requirements emerging from increase in number of families. Health vaccination of girls in the age group of  11-14 years for prevention of cervical cancer along with upgradation of Anganawadi Centers  under SatSham   Anganawadis and Poshan 2 services. Further for women empowerment 85 lakh Self Help Groups ( SHG) with 9 crore  women are to become transformed in their mental and socio economic landscape with empowerment and self reliance.The health care scheme undertaken also provides health insurance to Anganawadi workers Similarly for  empowering the youth1.4 crore youth have been trained under skill India Mission. To foster entrepreneurial aspirations of youth 43 crore loans have been  sanctioned under the PM Mudra Yojana. For the technology savy youth a corpus of ₹ one lakh crores will  be established with five year interest free loans.The corpus is expected to establish good support to the concerned sector. Direct Beneficiary Transfer (DBT) has led to savings of ₹2.7 lakh crores and  credit assistance has been given to 78 lakh street vendors under PM SAVInidhiGovernment claims that 25 crore people have moved out of multidimensional poverty .For  the welfare of Annadata (farmers) Direct financial assistance provided to 11,8 crore farmers under PM- KISAN. Crop insurance has been given to 4 crore farmers and there has been integration of 1361 mandis under e Nam supporting trading volume of ₹ 3 lakh crores.The interim  budget made allocation under  production Linked Incentive (PLI) scheme for new sectors Like Toys and leather and footwear  for the year 2024-25 and for the same year total PLI disbursement is pegged ₹ 6200 lakh Crores Another highlight is the establishment  of large number of new institutions of higher learning namely  IIT s ,16 IIITs,7 IIMs, and 15 AIMS to meet the requirements of youth.

 Despite the narration of past achievements , future prospects and vision for 2047 as developed India, finance Miinister in her interim budget strictly adhered to her fiscal consolidation strategy. The claim that 10 crore Indians came out of multidimensional poverty  needs to  be collaborated further. However the tax buoyancy, digital revolution, benefits of PLI schemes to some  sectors, startups and innovation and DBT schemes needs to be appreciated. As  far as Fiscal consolidation is concerned fiscal deficit as a percentage of GDP has been decreasing from 6.8 % in 2021-22 to 6.4 in 2022-23  to revised estimate of  5.8 in 2023- 24 as against budget estimate of 5.9.Interim budget indicated 5.1 percent fiscal deficit for 2024-25  assuming 11.5% increase in tax revenues reduction in fertilizer subsidy from₹ 1.88 lakh crores in 2023-24 to ₹ 1.64 lakh crores in 2024-25  and food subsidies to drop from ₹ 2.12 lakh crores in 2022-23 to 2.05 lakh crores for 2024-25 respectively. The ever  increasing  demand for infrastructure projects and other existing and newly announced social welfare programs  are bound to constrain the fiscal deficit target announced for 2024-25.