Current Affairs

Present State

The Union Budget 2024 focuses on infrastructure development, agriculture, digital economy, and healthcare. The government has increased capital expenditure to boost public infrastructure projects such as roads, railways, and ports. The digital economy is another key area of focus, with increased investments in technology infrastructure and initiatives to boost digital literacy and inclusion.

Tax Reforms: Efforts have been made to simplify the tax system, with initiatives to improve compliance and broaden the tax base. The introduction of Goods and Services Tax (GST) has streamlined indirect taxation, though challenges in implementation persist.

Fiscal Deficit: India’s fiscal deficit for 2024 is projected at around 6% of GDP, with the government focusing on controlling expenditures while ensuring long-term growth.

Implications

Investment in Infrastructure: Increased public spending on infrastructure will have a multiplier effect, generating employment and boosting economic activity across sectors.

Revenue Generation: While the government has focused on tax reforms, increasing revenue generation through economic growth and compliance remains a priority to manage the fiscal deficit.

Social Welfare: The budget also prioritizes social welfare schemes, particularly in healthcare and education, to ensure inclusive growth and poverty alleviation.

Way Ahead

Balancing Growth and Fiscal Prudence: While stimulating growth is important, the government must also maintain fiscal discipline to ensure long-term economic stability. Reducing the fiscal deficit gradually while continuing investments in critical sectors is key.

Boosting Private Investment: Incentives for private investment, particularly in sectors like infrastructure and technology, will be crucial to complement government spending and drive growth.

Inclusive Policies: Ensuring that the benefits of growth reach the rural and underprivileged sections of society is essential for sustainable development.