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(GIST OF KURUKSHETRA) Budget 2024-25:Future-proofing the Rural Indian Economy

(SEPTEMBER-2024)

Budget 2024-25:Future-proofing the Rural Indian Economy

Context:

The Budget for 2024-25 is the action plan of the to outline a roadmap towards India’s development in the next five years. It lays the strongest-possible foundation for an ‘Atmanirbhar’ (self-reliant) and ‘Viksit’ (developed) Bharat. The budget has been presented with the ‘mantra’ of ‘Sabka Saath, Sabka Vikas, and Sabka Vishwas’ and the whole of nation approach of ‘Sabka Prayas’. It focuses on upliftment of four major castes, that is, ‘Garib’ (Poor), ‘Mahilayen’ (Women), ‘Yuva’ (Youth) and ‘Annadata’(Farmer).

About:

With a view to give boost to trade and industry, particularly, in rural areas, three major economic railway corridor projects will be implemented - energy, mineral and cement corridors, port connectivity corridors and high traffic density corridors.

Expansion of existing airports and development of new airports will continue expeditiously.
Metro and NaMo Bharat systems will be expanded in the spirit of transit-oriented development.

Infrastructure-led Growth:

The Jal Jeevan Mission (JJM) focuses on providing clean and accessible water, vital for health of the rural folks, while also creating jobs in water management and infrastructure. The proposed budget enhancement for these programmes in the current financial year, are a clear acknowledgement of the pivotal role infrastructure plays in rural upliftment.

The expansion of rural capital expenditure into areas like trade-tech signifies a move towards modernizing trade and industry which are highly significant for increasing productivity and sustainability.

1. Scheme A: First Timers

The scheme will provide one-month wage to all persons newly entering the workforce in all formal sectors. The direct benefit transfer of one-month salary in 3 instalments to first-time employees, as registered in the EPFO, will be up to Rs. 15,000. The eligibility limit will be a salary of Rs. 1 lakh per month. The scheme is expected to benefit 210 lakh youth.

2. Scheme B: Job Creation in Manufacturing

This scheme is intended to incentivize additional employment in the manufacturing sector, linked to the employment of first-time employees. An incentive will be provided at specified scale directly both to the employee and the employer with respect to their EPFO contribution in the first 4 years of employment. The scheme is expected to benefit 30 lakh youth entering employment and their employers as well.

3. Scheme C: Support to Employers

This employer-focused scheme will cover additional employment in all sectors. The Government will reimburse to employers up to Rs. 3,000 per month for 2 years towards their EPFO contribution for each additional employee. The scheme is expected to incentivize additional employment of 50 lakh persons.

4. Scheme: Centrally sponsored scheme in collaboration with State Governments and industry Under this scheme, 20 lakh youth will be skilled over a 5-year period and 1,000 Industrial Training Institutes (ITIs) will be upgraded in hub and spoke model with outcome orientation. The course content and design will be aligned to the skill needs of industry and new courses will be introduced for emerging needs. The Model Skill Loan Scheme will be revised to facilitate loans up to 7.5 lakh with a guarantee from a government promoted Fund. This measure is expected to help 25,000 students every year.

5. Scheme: Internship opportunities in top companies The Government will launch a comprehensive scheme for providing internship opportunities in 500 top companies to one crore youth in 5 years. They will gain exposure for 12 months to real-life business environment, varied professions and employment opportunities. An internship allowance of Rs. 5,000 per month along with a one-time assistance of Rs. 6,000 will be provided to the youth. Companies will be expected to bear the training cost and 10 percent of the internship cost from their CSR funds.

Schemes in Higher Education

A financial support will also be provided for loans upto Rs. 10 lakh for higher education in domestic institutions for helping youth who have not been eligible for any benefit under government schemes and policies. E-vouchers for this purpose will be given directly to 1 lakh students every year for annual interest subvention of 3 percent of the loan amount. The Anusandhan National Research Fund will be operationalized for basic research and prototype development.

The current Budget provides:

credit guarantee schemes in manufacturing, which should result in more funding for small businesses;
a new assessment model for granting credit (an innovative way to address MSME funding challenges); and
additional legal windows for expeditiously solving insolvency issues.

If we cast a glance at the seemingly hidden Gems in the budget, there are quite a many:-

Private sector-driven R&D allocated Rs. 1 lakh crore.
Solar Power budget doubled from Rs. 5000 crore to 10000 crore.
PLI on Pharma doubled from Rs. 1200 crore to Rs. 2100 crore, a move towards de-risking from importing Chinese ingredients(APIs)
Semi-conductor development allocation doubled from 3000 crore to 6900 crore, is for sure, a new age move.
The Vibrant Village Program Rs. 1000 crore; the Urban Digital Mission Rs. 115 crore, e-buses in areas difficult to travel-1300 crore, defence equipment manufacturing industries-40000 crore, for naval fleets-4000 crore, etc.

Conclusion:

As we navigate the complexities of the global economic landscape, the path to a prosperous India unequivocally goes through its villages and fields. Through a judicious mix of policy measures, resource allocation, and institutional reforms, the Budget endeavours to navigate the challenges and capitalise on the opportunities inherent in India’s economic landscape. As the nation embarks on a transformative journey towards inclusive prosperity and resilience, the Budget serves as a guiding compass, steering India towards a future defined by progress, equity, and opportunity.