Dr Pabitra Kumr Jena
The Economic Survey 2024 presented a complete analysis of India’s economic growth performance in lieu of global uncertainty. While it highlights India’s resilience and stable macroeconomic indicators, it also highlights key structural challenges that the Indian economy faced during the2024-25 financial year. These challenges include a slowdown of private investment, the manufacturing sector remains vulnerable to external shocks and persistent rural-urban disparities.In order to address the above challenges, the current budget aimed at accelerating inclusive growth, stimulating private sector investments, uplifting household sentiments, and augmenting the spending power of India’s rural and urban masses.
In this current budget, the foundation of development to achieve inclusive growth is spread over ten comprehensive areas, which include stimulating agricultural growth and productivity, enhancing rural development and resilience, working towards inclusive growth, augmenting manufacturing productivity for advancing Make in India, creating a conducive environment for Ministry of Micro, Small & Medium Enterprises (MSMEs), facilitating employment-led development, Investing in people, economy and innovation, ensuring energy efficiency, increasing exports and fostering innovation. To achieve fruitful results in the above ten areas, the budget considers agriculture, MSME, investment, and exports as four powerful engines of the development journey of the Indian economy. The budget stated that reform is fuel, whereas inclusivity is spirit, and Viksit Bharat is the final destination.
Agriculture as the first engine of growth the Prime Minister Dhan-Dhaanya Krishi Yojana targeted to enhance agricultural productivity, implement crop diversification and sustainable agriculture processes, expand post-harvest storage at the panchayat and block level, advancementof irrigation facilities, and simplify availability of long-term and short-term credit. The proposed scheme is expected to benefit 1.7 crore farmers.
A wide-ranging multi-sectoral ‘Rural Prosperity and Resilience’ programme will be launched in cooperation with states. This will address the unemployment situation in agriculture through training, investment, innovation, and uplifting the rural economy. The goal is to create sufficient job opportunities in rural areas to reduce migration to a greater extent.A complete initiative to enhance production, optimize supply chains, facilitate processing, and ensure profitable pricing for farmers will be implemented in collaboration with state governments. Institutional structures for the implementation and engagement of farmer-producer organizations and cooperatives will be established. A National Mission on High Yielding Seeds will be on track with the goal of improving the research environment, developing and spreading seeds that have a high yield, are resistant to pests, and can withstand climate change, and making more than 100 different seed kinds commercially available.
The Government would establish a framework to sustainably exploit fisheries in the Indian Exclusive Economic Zone and High Seas, particularly emphasizing the Andaman & Nicobar and Lakshadweep Islands, to unleash the marine sector’s hidden potential. Kisan Credit Cards (KCCs) were given to farmers in order to create inclusive growth in rural areas. These cards provide short-term loans to 77 million farmers, fishers, and dairy producers.The loan cap under the Modified Interest Subvention Scheme would be increased from ?3 lakh to ?5 lakh for loans obtained via the KCC.
India Post will be restructured into a significant public logistics entity. This will address the increasing demands of engineers, emerging entrepreneurs, women, self-help groups, MSMEs, and large enterprises. India’s 10 million registered MSMEs, employing 75 million individuals and contributing 36% to manufacturing, are establishing the nation as a worldwide hub. In order to improve efficiency, technological advancement, and capital accessibility, investment and turnover thresholds for MSMEs will be increased to 2.5 and 2 times, respectively, to facilitate their growth and job creation.The Government will launch tailored credit cards with a maximum of ?5 lakh for micro firms registered on the Udyam platform. In the inaugural year, 1 million such cards will be distributed.
A new initiative will be introduced for 5 lakh women, as well as first-time entrepreneurs from Scheduled Castes and Scheduled Tribes. This would offer term loans of up to ?2 crore over the next five years. The initiative will integrate insights from the effective Stand-Up India program. Online training for entrepreneurship and managerial skills will also be conducted.
The Government will establish a National Manufacturing Mission, including small, medium, and large firms, to advance “Make in India” through policy support, implementation roadmaps, and a governance and monitoring structure for central ministries and states. This budget will also emphasize clean tech manufacturing for a sustainable environment and society.
Tourism will also play a bigger role in inclusive growth in the budget, which compromises the top 50 tourism destinations in the country, which will be developed in collaboration with states using a competitive approach. States would give land for the construction of essential infrastructure. This budget also allocated performance-linked incentives to governments for efficient destination management, encompassing visitor amenities, cleanliness, and marketing initiatives. Medical tourism and healthcare in India will be advanced through collaboration with the business sector, alongside capacity building and streamlined visa regulations.
Among other major initiatives for inclusive growth, this budget emphasized establishing fifty thousand Atal Tinkering in government schools to foster inquisitiveness, invention, and a scientific approach among youth. Further broadband connectivity will be extended to all government secondary schools and basic health centres in rural regions under the Bharatnet initiative.Five National Centres of Excellence for skill development would be established, leveraging global experience and collaborations to prepare our youth with the necessary skills for “Make for India, Make for the World” manufacturing. The collaborations will encompass curriculum development, trainer training, a skills certification framework, and regular evaluations.
This budget also announced reforms in the power, urban, mining and energy sectors. Finally, great relief has been given to taxpayers of our country to bring back aggregate demand and keep it on track, creating a natural investment climate for Indian as well as foreign investors, which would promote inclusive growth in the Indian economy to reduce income inequalities.
(The author is Associate Professor, School of Economics, Shri Mata Vaishno Devi University, Katra, Jammu & Kashmir)
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