New Delhi, Delhi, India
While applauding the Union Budget 2016-17 budget announcements, President, PHD Chamber, Dr. Mahesh Gupta said that Budget has touched the ground and its focus on rural India would go a long way to generate demand in the economy and give a push to overall growth and development of the country. We are happy that our suggestion to increase deduction on exemption for Income Tax on interest paid on Home Loans has been partly accepted as there is an additional exemption of Rs. 50,000 for housing loans up to Rs. 35 lakh, provided cost of house is not above Rs. 50 lakh which will give a boost to the real estate sector, he said.
The nine pillars of Union Budget viz. Agriculture, rural sector, health sector, education skills and job creation, infrastructure and investments, financial sector reforms, governance and ease of business, fiscal discipline, and tax reform to reduce compliance burden are inspiring and will not only fuel economic growth but increase India’s competitveness, said Dr. Gupta.
We suggest that there should not be any cap on the price of house. It should be open-ended for the house buyers, said Dr. Mahesh Gupta.
Stimulus to real estate sector would provide a significant fillip to the economy and enhance India’s GDP and so will be the level of enhanced revenue to the government and desired fiscal consolidation, said Dr Gupta.
Allocation of over Rs. 87,000 crore for rural development is encouraging as it will increase farmers’ income in the coming times and fuel rural demand which is the need of the hour, he said.
Allocation of Rs. 38,500 crore for MGNREGA will facilitate employment generation in rural areas and will facilitate all-inclusive growth in the economy, he added.
However, the supply side should also be focussed particularly availability of food items should be ensured as demand is going to increase in the rural segments in the coming times, said Dr. Mahesh Gupta.
Allocation of Rs 2.87 lakh crore to Gram Panchayats is highly appreciable as it will help in growth and development at the grassroots of villages, said Dr. Gupta.
Focus on development of infrastructure through high allocation of Rs. 2,21,246 crore while capital expenditure of Rs. 2 lakh crore on railways and roads will lead to creation of state of the art infrastructure which is much needed for upscaling manufacturing growth and fueling economic growth in the coming times, he said.
The medium term goal of the government to abolish permit-raj regime is inspiring as it will fasten clearances and facilitate ease of doing business, added Dr. Gupta.
100% FDI allowed in marketing of food produce manufactured and processed in India will give a boost to not only the Food Processing Industry but also Agriculture sector. It will give a push to Make in India initiative of the government, he said.
The government’s decision to retain fiscal deficit at 3.9% in 2015-16 and target of 3.5% in 2016-17 despite burden due to 7th Pay Commission, shows government’s commitment to maintain fiscal prudence, said Dr. Mahesh Gupta.
The budget focuses on socio-economic development as Rs. 1700 crore has been allocated for 1500 multi-skill development centres while 62 new navodaya vidyalayas to provide quality education, he said.
Also the additional healthcare cover of Rs 30,000 for senior citizens is a step in the right direction, he said.
Though no changes have been made in income tax slabs, the increase in deduction for rent paid to Rs. 60,000 from Rs. 20,000 will benefit the households, said Dr. Gupta.
The allocation of Rs. 25,000 crore towards recapitalization of Public Sector Banks is inspiring. However, the current state of banks desires more allocation of funds, he added.
The Price Stabilization Fund set up with a corpus of Rs. 900 crore is inspiring as it will help to maintain stable prices of pulses which have been a cause of worry in the recent times, he said.
The increase the turnover limit under Presumptive taxation scheme under section 44AD of the Income Tax Act to Rs. 2 crores is highly appreciable as it will bring big relief to a large number of assessees in the MSME category, said Dr. Gupta.