This year’s Union Budget particularly reflects the confidence, maturity and vision of the Finance Minister to keep India’s economic growth on the fast track. By his own admission, in the current year we have reached the end of a remarkable fiscal year with GDP growing at 8.6% in real terms.

With the economic growth is seen at 8.75 – 9.25% next year, the Finance Minister has taken a very strong challenge and done a remarkable job not only by focusing on high growth but also making that growth inclusive. Along with massive investments in health, education, agriculture and infrastructure, the Finance Minister’s guiding principles are modern and simple– this is commendable.

Next, to creating food security, the Finance Minister has spared no resources for infrastructure. He is happy that the economy has shown resilience to internal and external shocks. The concessions made to capital goods and the power industry will immensely help the power sector. The corpus of rural infrastructure development fund has also been raised.

For the organized retail sector, the reformation of APMC Act augurs very well.

Discussions to relax FDI also is most welcome. Also significant is the decision to give infra-status to cold storage chain and the proposed boost to infrastructure development with tax-free bonds.

Without any net additional taxation, direct and indirect taxes taking together, the Finance Minister has been able to reduce the fiscal deficit from 5.1% to 4.6%. This means that Government’s borrowing from the market will be less and will create additional room for the private sector to raise money by issue of bonds and equity.

The Finance Minister has tried to touch almost every aspect of our life. Particularly welcome is the cut in tax surcharge for companies from 7.5% to 5%. Also welcome is the foreign dividend tax rate cut for Indian companies.

Also reassuring is the Finance Minister’s assessment that India is on the threshold of a decade of immense possibility and the government is determined to keep tax proposals moderate, simple and easy.

(The author is the Vice-Chairman of RPG Enterprises.)

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