Finance minister Nirmala Sitharaman has her agenda cut out as she presents her maiden Union Budget this Friday. With unemployment, affordable housing, health and education crying out for attention, expectations of tax sops for these sectors are high. If she provides sops to these sectors she could kickstart growth, which has been languishing and touched a low 5.8 per cent in the last quarter, making a mockery of Prime Minister Narendra Modi’s promise of double-digit growth. Rural distress is also significant, with farmer suicides continuing. Economic growth is a challenge for Mr Modi and he had sought re-election so that he could implement the promises made in the first term.
The finance minister is probably aware that she can kill two birds with one stone by giving a fillip to housing, which is a job multiplier. It’s the second-biggest employment generator after agriculture, and contributes between 5-6 per cent to GDP.
The PM had promised 10 crore jobs in his first term to meet the requirements of seven million people who enter the job market annually. In fact, she can begin with announcing sops to kickstart the 5.6 lakh stalled projects worth `4.5 lakh crores launched in 2013.
In the health sector, the PM’s cheap health insurance through Ayushman Bharat is languishing and needs Ms Sitharaman's attention. The most important issue before industry today is investment. Private investment is yet to pick up and the government’s capital expenditure is between 1.6 to 1.8 per cent of GDP. The finance minister must announce some measures that would pump this up to two per cent if it is to meet the growth target.
