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Populist Budget aims to bolster India’s rural economy

Feb 02, 2019

In line with election-year needs, the government has announced sops for the poor, farmers, and the middle class.

New Delhi: The last budget by the Narendra Modi government is being seen replete with populist measures wherein efforts have been made to please various sections of the society. OneWorld South Asia brings reactions of various organisations including India Inc to the interim budget.

Udaya Kumar, MD and CEO, CreditAccess Grameen Limited.

We believe the slew of measures in the interim budget aiming at addressing the Rural & Agriculture sector will ultimately bolster the rural economy. Initiatives like Kisan Scheme will further stabilize farmer’s financial condition, increasing access to credit and increase their income subsequently.

Steps announced for Rural & Agriculture sector further support the borrowers with additional money in their hands, is quite positive for Microfinance Industry. All in all it’s a holistic approach to a better India.”

We welcome the interim budget, in a major relief move for the middle-class taxpayer the Finance Minister Piyush Goyal announced income tax relief for those earning up to Rs. 5 lakh and R.s 6.50 lakh.

Anurag Bhatia, CEO, Head of Investments, Minance

On the whole, the interim budget was exactly that, an 'interim' budget. In line with election-year needs, the government has announced sops for the poor, farmers, and the middle class. However, these sops may not be enough to satisfy everyone.

The government has leaned on the populist side and as a result, the fiscal deficit is higher than planned but it is manageable and you can't blame the government for trying to remain in power.

Support for farmers: Rural distress was a major issue last year and the budget was expected to address that and while a direct deposit of Rs. 6000 for small farmers will go a long way (and help the rural economy) it was lesser than expected.

Roopam Asthana, CEO and Wholetime Director, Liberty General Insurance

Clearly the Government has focused on two large consuming segments viz., farmers/rural poor and middle class populace. This will lead to more money in the hands of these segments and will ultimately flow into the economy in the form of consumption.

The farmer has been suffering from low realization on their produce, which is benefiting the urban consumer in the form of lower inflation and thus the urgent need to provide relief to the farmer.

I am also happy that instead of focusing on loan waivers, the Government is focusing on loan rescheduling and interest rate subvention which will hopefully not promote unacceptable credit management behavior. Overall the fiscal slippage is not something that a large economy like ours cannot handle. I expected some benefits to promote the purchase of more insurance, which is also a shield for the poor and middle class against unforeseen calamities – which was unfortunately missing.”

Abhishek Dubey, Founder & CEO, Muskaan Dreams

The government has presented a well-balanced budget with a focus on addressing the fundamental needs of education in India. The government has raised the bar, by introducing schemes that will help bridge the rural-urban gap, both in the economic and educational sector.

A budget of 38,572 crores in BE (Budget Estimate) is allocated for National Education Mission. 10% reservation in educational institutes and government services for the poor has been implemented, to ensure that there is no shortfall of available seats for any class, and uplift the backward classes.

The government has also planned upon developing one lakh digital schools around the country in the next 5 years, I think digital villages will become a great move for this govt, it will enhance skills of rural youth also help them to get a better job. Most of the startups are working in Tech based solutions and it helps youth to get the job. It will help them to learn about digital technology or skills-based programme.

India is amongst the most youthful nations in the world, and through policies focused on the youth of the nation, like Pradhan Mantri Kaushal Vikas Yojana, great economic development can take place.

I am glad that the concept of employment is changing in India with job-seekers becoming job-creators. The interim budget is expected to offer a big revolution to the nation’s economy.

Dr Siya Seth, Partner, CEO of Sum Drishti Foundation

“Ujjwala LPG scheme is a good initiative by the government to ensure clean fuel for cooking which is directly impacting woman’s health in rural areas. Reaching target of 6 crore connections out of 8 crore is a tremendous feat and we expect this fast growth to continue and reach its target in the next two years,’ Dr. Siya Seth, CEO, Sum Drishti Education Society, a pan-India NGO working for the empowerment of women through social development projects.

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