Impact analysis of Union Budget 2022-23

The finance minister presented the Union Budget 2022-23 in the midst of the third COVID wave, Omicron. The budget this year focused on building a governance and policy strategy for the next 25-year 'Amrit Kaal' period, while also seeking to continue measures undertaken over the last two years to support the economy affected by COVID-19. Key strategy areas are around a microeconomic welfare outlook to complement the macroeconomic growth outlook, promoting digitalisation and technology to recreate a virtuous capex cycle.

We are witnessing a sharp rebound and recovery of the economy which is reflective of our country's strong resilience. This year's budget has underlined the government's focus on long term impetus to growth. While being a balanced budget it emphasizes on capital expenditure while contributing positively to the quality of fiscal policy.

While Fiscal Prudence and Management is concerned the Fiscal deficit is projected at 6.4% of GDP for 2022-23 BE with intent to reach a fiscal deficit level below 4.5% of GDP by 2025-26, with a fairly steady decline over the period. The fiscal deficit in RE 2021-22 is pegged at 6.9% of GDP. To enhance the Agriculture and Rural Economy, Kisan Drones' will be promoted for crop assessment, digitization of land records, spraying of insecticides and nutrients and the scheme under PPP mode to be launched for delivery of digital and hi-tech services to farmers.

For Digital Outlay, One class-one TV channel' programme of PM eVIDYA will be expanded from 12 to 200 TV channels and there will be establishment of Digital University. It has been Proposed to introduce Digital Currency by RBI using blockchain technology, starting 2022-23 and there will be 75 digital banks in 75 districts which will be set up by scheduled commercial banks to encourage digital payments and Finally the Tax Proposals, the government has proposed that transfer of any virtual digital asset (Crypto Tax) will be taxed at 30% and the proposal to reduce surcharge on cooperative societies to 7%, for those whose income is between Rs.1 crore and Rs.10 crore.

S Mohini Ratna, Editor, VARINDIA