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Budget 2018: Boosting digital connectivity in rural India

Feb 08, 2018

Increased spending for development in rural India announced in the budget is being welcomed by people as a positive initiative.

New Delhi: Indian Finance Minister Arun Jaitley announced a slew of measures for farmers and the vulnerable which includes an increased allocation in the Union Budget for development in rural areas.

Civil society and corporate world react to government’s plan towards massive spending on farmers and rural areas one of the positive aspects of this budget. OneWorld brings comprehensive post- budget 2018-19 reactions on the rural front.

S Ravi, Founding Partner, Ravi Rajan & Co, and Chairman of BSE

Budget 2018 has emphasized the need for structural reforms with outlays focusing on rural economy and rural infra development at Rs.14.34 lakh crores, benefits to farmers by proposing to fix Minimum Support Price (MSP) at 1.5 times the market price

Umesh Revankar, MD & CEO, Shriram Transport Finance

Prime Minister Modi’s fourth budget is growth oriented and continues to strengthen the mission of rural and infrastructure development. The budget gives impetus on boosting farmer incomes and employment in rural areas.

The Finance minister has rightly touched upon on the MSME sector and provided various measures to stimulate the sector. The government’s MUDRA Yojana has successfully benefitted not only the lower income groups but also encouraged women entrepreneurship. With continued thrust on the MUDRA scheme, the government is sure to achieve its objective to create much-needed employment.

Peter Kerkar, Group, CEO, Cox & Kings

Giving a boost to the rural economy will also enhance the purchasing power amongst those living in rural areas and this in turn will stimulate travel. We have observed this over the last couple of years.

Mahavir Chopra, Director - Health, Life and Strategic Initiatives,

The Finance Minister's reinforced thrust on Digital India through measures like Wi-Fi Hotspots in rural areas will significantly increase internet penetration making India the largest internet enabled population in the world.

Access to internet will create skilled jobs in rural areas, avoid migration, and increase reach of rural population to services (like insurance) available only in cities beyond reach.

Nikunj Turakhia, President, Steel Users Federation of India (SUFI)

The 2018 was Pro-Farmer, Pro-Agriculture, Pro-Poor and Pro-MSME. India being an agricultural based economy, this budget and the measures taken for the agriculture sector will really as confident booster for the farming sector.

On the other populist side, the National Health Protection Scheme is a major step in providing affordable health services for the poor & marginalised section.

Ravi Sreedharan, Founder, ISDM

The Union Budget 2018 has made a very considered effort in allocations towards addressing the rural distress, particularly in the livelihood and agriculture sector. Operation Green supported by an effort to link farmers to markets for better price realisation is a welcome measure by the government.

The MSP increase to 150% for crops, support to organic farming, Increased expenditure allocations to Food processing sector at Rs 1400 crores, increased allocations to fisheries and animal husbandry, extended facilities on Kisa credit cards, and considered increase in credit volume for agricultural sector are some of the much awaited and welcome moves by the government towards boosting the agricultural economy.

Allocation to MGNREGS has seen a 7000 crores increase when looked at with reference to revised estimates of 2017 which stood at Rs 48000 crores. It is important to note however that the present allocation of Rs.55,000 crore is very close to the expenditure records of the scheme in 2016 which stood at INR 53,594 crores.

Also, one of the key challenges concerning MGNREGS has been the delay in payments amounting to a share of 53% in January 2016-17. The governance challenge in the delivery of social security schemes like MGNREGS remains a question yet to be addressed for the current government in 2018-19.

Amar Pandit, CFA, Founder,

The Budget has been a populist budget with major focus on rural development and infrastructure. The populism was expected with the 2019 general elections in mind. The FY19 fiscal deficit target has been revised to 3.3% of GDP which is a decent target considering the impact demonetization and GST had on revenue this financial year.

P Venkatesh, Director & Co-founder, Maveric Systems

The government is continuing with its thrust on building the foundations for both individual and enterprise sectors. On the individual end, the rural development, employment generation through SMEs and rural employment, education, low cost housing and health are coordinated actions and are continuing to receive attention

The establishment of Wi-Fi spots in rural is welcome. This would pave the way for digitization since the infrastructure is available to scale.

Sandeep Sabharwal, CEO, SLCM Group

The Budget has focused majorly on strengthening MSME and agricultural sectors along with a higher spend on infrastructure. These steps will cover the entire ecosystem of economy. As far as the agriculture sector and the farmers are concerned the increase of minimum support price (MSP) of all crops is a move towards Prime Minister’s vision of doubling farmers' income by 2022 and this augurs well for the agriculture value chain.

Other laudable steps that will help the farming universe is connecting APMC’s to eNAM network, setting up Agri-Market Development Fund and adoption of cluster model approach. Also, the announcements made in the budget provide impetus to the food processing industry with allocation of Rs. 500 crore for ‘Operation Green’ to provide logistics, storage and other infrastructure support. All these indicate creation of a newer BHARAT, where the development is more inclusive."

Anshuman Panwar, Co-Founder, Creditas Solutions

The budget focuses on inclusive growth with significant thrust on empowering women, poor and farmers. I believe this will contribute to the holistic growth of India. Doubling the allocation for digital investments is a good move too and will help the country's vision to be a digital-first economy.

Maulik Doshi, Partner, Transfer Pricing and Transaction Advisory Services, SKP Business Consulting LLP

Government promises a Minimum Support Price of 150% of production cost of agricultural produce along with setting up of Gramin Agricultural Markets. This is a significant measure and would be a shot in the arm for the small and marginalized farmers.

K Paul Thomas, M D & CEO, ESAF Small Finance Bank

The massive spending on farmers and rural areas is another positive aspect of this budget. It also includes world’s largest Govt funded health program for the poor. Also tax exemption for FPOs truly deserve an applaud.

Other notable announcements include increase in government contribution to EPF of new employees for the next 3 years and allowing women employees to take a higher take home pay.

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