With just 30 days left for the Union Budget 2019, Modi 2.0 government gets down to prepare its first Budget for FY20, with individual ministries preparing their wish list, which will be considered by the finance ministry. The newly appointed Finance Minister Nirmala Sitharaman will present her first Union Budget on July 5, according to official statement released by the government on Friday.
The North Block, which houses the finance ministry, will be in 'quarantine' from Monday until the presentation of the Budget to keep the whole Budget a secret exercise. Work has already begun in this regard.
Now that Narendra Modi is back as the prime minister for the second time after the landslide victory in the 2019 Lok Sabha Elections, the government is expected to roll-out bolder reforms. The Budget 2019 will pave the way forward for the Bharatiya Janata Party (BJP) to deliver on unfulfilled promises and tackle complicated economic issues. Infrastructure creation and job growth will grab limelight in the upcoming budget, sources within the ministry told India Today. The government will also focus on the simplification of direct taxes and increasing compliance.
In the interim budget, the Finance Minister had reiterated government's commitment to infrastructure development, but no apparent big-ticket gains were seen from infrastructure perspective. One needs to wait for the main budget to see the actual allocations, which needs to take into account government's commitment and thrust on infrastructure, as well as new initiatives and alternate sources of financing these. Ahead of the Lok Sabha elections, the interim Budget for the current fiscal was presented by the then Finance Minister Piyush Goyal in February earlier this year.
Given that the domestic economy suffered its worst slowdown in five years, it would be a big challenge for the 59-year-old JNU alumnus, Sitharaman, to address slowing economy, financial sector troubles like rising NPAs and liquidity crisis in NBFCs, job creation, private investments, exports revival, agrarian crisis, and raise public investment without compromising on fiscal prudence.
In the upcoming Budget, the key challenges for Sitharaman will be capital infusion in the financial sector and freeing up resources for infrastructure. The government may infuse Rs 40,000 crore into state-owned banks in 2019-20 in order to strengthen their balance sheets to enable them to push credit growth.
The first session of the 17th Lok Sabha will be held from June 17 to July 26, with the economic survey to be tabled on July 4 followed by the presentation of the budget on the next day. The session will have a total of 30 sittings.
Edited by Chitranjan Kumar