The union government is currently working on a two-pointed Budget, unveiling on 29th February, which will drive towards the market economy to have an overall growth but at the same time which will address the rural population and further their growth. The budget is expected to broader social security measures and also, changes in agricultural policy.
- The budget, according to sources, will be more focused on credit issues and lessen the security to have greater access to equity funds. The Indian economy at present is growing at a good rate of 7.6% but it is mostly depended on and surrounded around by urban population and government capital spending. But this budget will see a high priority for rural demands.
- The government plans to come up with new social initiatives to address the rural demand and provide emphasis on irrigation to lessen the risk in farming. Also, the Pradhan Mantri Jan Dhan Yojana initiative about social inclusion programme is expected to be added with more initiatives to provide benefits to rural India. According to sources privy to this budget revealed that the Food Security Act will be backed with even more funds to help move direct benefit transfers. It simply means that subsidy payments directly will be transferred to beneficiary’s bank account. Also, it is known that a bigger direct transfer through cash distribution of fertilizer subsidies will also be provided.
- To encourage rural entrepreneurship to create non-farming jobs, MUDRA loans will be given priority as well. Farm infrastructure will also be given priority by more to form better rural roads as well as irrigation. Simultaneously the government will also influence Nabard (National Bank for Agriculture and Rural Development) to fund irrigation through tax-free bonds.
- On the market front, the government is planning to scrap Rajiv Gandhi Equity Savings Scheme which has not been too much of a success, with a new method to attract more investors to the stock market. The union government is also looking for various ways to have systematic investment to encourage the flow of savings into equities.
- Lastly, the budget is expected to address the bad loans that the disturbed the public sector banks. The upcoming budget is also expected to find solutions to the problem pertaining to development.