Post Budget Analysis – 2022

On February 7, 2022, the International School of Informatics and Management hosted a panel discussion on "Post Budget Analysis - 2022."

Prof. C.S. Barla, Eminent Economist and Ex-Professor, University of Rajasthan, Mr. J S Upadhyay, Retired AGM, SBI Bank, Jaipur, Mr. Nesar Ahmad, Director, Budget Analysis & Research Centre, Jaipur, Mr. Varun Sharma, Programme Director, Aravali, Jaipur, Mr. Ankit Somani, Regional Council Member, Seven States, Ajmer. Mr. Shailendra Agarwal, Senior Journalist, Rajasthan Patrika, were amongst the eminent panelists who presented their views on the latest budget.

The purpose of the session was to explore the benefits and drawbacks of the recent budget from various viewpoints, as well as to inform students about the budget's financial impact on the country's micro and macroeconomic elements.

Mr. C S Barla provided a comprehensive overview of the budget, discussing the budget's numerous economic consequences across all macro factors. He also stressed the importance of comprehending the country's major issues, such as rural suffering and unemployment. He talked about the expectations that a common man has from the budget and the role of Finance Ministry in meeting those expectations by means of budget. He apprised the participants with the exclusivity of the recent budget by announcing heavy emphasis on increasing capital expenditure to increase the overall speed of the economy.

Mr. J S Upadhyay commented upon the various moves taken by the finance minister in the existing budget like charging 1% TDS on purchase of virtual digital asset, subject to stipulated thresholds, income from transfer of virtual digital asset will be taxed at 30% from now onwards, announcement of the upcoming central bank digital currency (CBDC) and considered all the moves as appropriate. He shared that tax revision for such assets is needed to reduce gap of inequality and levying tax on those who are earning more returns through different investment avenues.

Mr. Nesar Ahmad, shared his views over reduced GDP and slower pace of recovery of the country. He appreciated budget on the ground of allocating budget to housing sector as to meet basic need of the people. But he raised his concern over not allocating anything differently to agriculture sector. He said that heavy reliance on building road and bridges is undoubtedly required but core sectors which include agriculture also need significant attention. He said that Government has not done anything differently to curb employment but the decision in the budget to increase capital expenditure might result in increasing employment opportunities. He informed that existing budget has given due consideration to education sector which would help India immensely.

Mr. Varun mentioned that Finance Ministry should prepare budget keeping in view the real problems and should not just pay attention to data available. The sectors which are lacking behind should be primarily emphasized. The government should decide the ratio of budget allocation between infrastructure and health, as capital expenditure might give wings to economy but health infrastructure can add to life expectancy and quality of life. He shared that government needs to focus on tackling problems like disparity in mortality rate in different states, gender issues and resources allocation.

Mr. Shailendra drew attention to India’s unstoppable growth trajectory. He informed that every year budget outlay is a decisive factor in India to be a powerful country. He appreciated New Education Policy of Government of India and is expecting a significant contribution of it in creating new India. He shared that in India, Government should work less on report preparation and analyze the available data more. He threw light on the fact that next five years are very important for India to prove its mettle in the world economy.

Mr. Ankit shared that the latest budget made no changes to the existing income tax structure, disappointing the general public and several other groups. There were, however, moves that could prove to be a significant boost to the economy as a whole in the future. He also mentioned a fee on long-term capital gains (LTCG) that will be capped at 15% and will be applied to all assets. It only applies to listed equity shares and equity-oriented fund units till recently. He spoke on wage rates, explaining that while MGNREGA wage rates grew by 4% between FY 2020-21 and FY 2021-22, actual salaries paid in most states remained lower than the announced wage rates until December 31, 2021, which is not a positive sign. He expressed his concern over the problem of unemployment and fair wages prevalent in the country.

Mr. C S Barla while concluding the session shared that it is not just about making new policy but it is the effective implementation that will ensure its utility and success. He expressed that the budget should be prepared and viewed in the light of affects of Covid-19. The high dependency on Foreign Direct Investment should be reviewed every year in respect of GDP growth secured. Government should try to reduce fiscal deficit for securing real growth of the country. He shared that currently retail price index is discouraging and should be considered for the purpose of understating the purchasing power of the common man. He emphasized that savings should be encouraged to spur investments.

He acquainted the students with the nitty-gritty of the financial climate and also spoke about the aspects that must have been incorporated in the budget to make it a stable budget in his concluding remarks.

Students posed a lot of questions to the panelists and learned how important it is to engage in budget analysis.



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