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Finance Minister Arun Jaitley presented Budget 2017-18 in Lok Sabha on February 1 , 2017. The minister announced several measures which will affect the economy.
Income tax rate on income between Rs 2.5 lakh to Rs 5 lakh cut from 10 per cent to 5 per cent, giving a relief of Rs 12,500 to individuals less than 60 years of age.
Demonetisation has not had any major impact on the Budget 2017 moreover it feels like the goverenment has continued with its theme that it has been talking about since a considerable amount of time. Even when they were getting on with thier election mode, they spoke of the same changes. These changes include: rural housing, poor, agricultural output, irrigation projects, rural road projects and more.
Former planning commission member Abhijit Sen talks about the lack of demand and disappointing state of private investments.
Shubhashis Gangopadhyay highlights the importance of state level activity needed for the Indian economy as many state governments are caught up in the pre 90s mindset.
The common man will get relief from difficulty he has been through because of demonetisation but the larger reforms like roadmaps for reductions to corporate tax rates to 25 per cent is doubtful to come through
According to D K Srivastava, we have entered into, what monetary policy makers call, a dark corner because the inclination of people to hold on to currency has gone up.
D K Srivastava says that the Indian economy is stuck in a macro fiscal challenege where investment contraction is being followed by consumption contraction. Now, the question is how aggressive the government can be in order to stimulate the economy.
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Skill development has been the major focus of the Modi government which has launched campagins like Start-up India and Skill India over the past few years.
Mahesh Jaising , partner at BMR and Associates says the Budget will focus on customs duty front, and encouraging Make in India. The government might make minor changes in excise and service tax law.
Mukesh Butani, managing partner at BMR Legal says people expect a definitive road map for a cut in corporate taxes in line with announcements made in the 2015 Budget.
Vivek Gupta, partner BMR Advisors says the government should reward the honest taxpayers in this Budget. The government is expected to make announcements related to tax incentives to create employment.
Now, the question is how a budget 2017 proposal counterbalance to help the Indian economy overcome the stress created by demonetisation which has impacted investments and sentiments.
Success of the two flagship programmes of the government of India, Start-up India and Make in India, depends on the quality of graduates Indian institutes produce. Union Budget 2017-18, therefore needs to increrase its focus and attention to education sector by increasing public expenditure to at least 6 per cent of GDP. Education sector has to be in the list of exempted sector in order to ensure that the benefits keep on flowing to the sector which were removed or rather decreased in last year budget.
Business Today's senior associate editor, Joe C Mathew talks about the government's demonetisation decision's impact on the upcoming Union Budget
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