Budget 2022: These are the 5 big challenges before the Finance Minister, the best suggestions given by economists

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Budget 2022- India TV Paisa
Photo:India TV

Budget 2022

Highlights

  • Efforts should be made in the budget to get money in the hands of the common people.
  • On the lines of rural MNREGA, urban MNREGA is necessary for the urban unemployed
  • Need to increase spending on health to at least 3 percent of GDP

New Delhi. Finance Minister Nirmala Sitharaman will present the general budget on 1 February amid the Corona epidemic. In this budget, the Finance Minister will have to focus especially on many challenges including accelerating the pace of the Indian economy recovering from the Kovid-19 crisis, reducing unemployment, increasing the income of farmers and small businessmen. India TV spoke to the country’s well-known economist Arun Kumar on the challenges related to the budget in front of the Finance Minister and took his suggestions. Here are the highlights:-

1. Reducing Unemployment and increase jobs

Unemployment has increased rapidly after the Corona epidemic. Although there has been an improvement in recent times, it is still much above average. According to CMIE, the unemployment rate in India is currently 6.9%. At the same time, the urban unemployment rate stands at 8.4% and the rural unemployment rate at 6.2%. The Finance Minister will have to emphasize on reducing unemployment through the budget. For this, budget allocation on Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) should be increased in the budget. Apart from this, on the lines of rural MNREGA, announcement should be made to start urban MNREGA for the urban unemployed. This will help reduce the unemployment rate and increase employment.

1. Bringing Domestic Demand Back on Track

The National Statistical Office (NSO) estimates that India’s economy will become the world’s fastest growing economy at 9.2% during 2021-22. Despite that this year’s growth rate is coming in at a negative rate of last year’s unprecedented 7.3%. That is, there is a need to increase the pace of the Indian economy. To encourage the government to increase demand. Regarding increasing demand, economist Arun Kumar says that the biggest impact of the corona epidemic has been on the small income group. Due to the crisis of livelihood, their purchasing power has almost ended. 40% of the country’s population is the worst affected. In such a situation, to increase the demand, the government should make efforts in the budget to get money in hand among the people of the lower rungs of the society. For this, the government will have to take steps like cash transfer.

3. Controlling Rising Inflation

Retail inflation has risen to 5.59 per cent due to costlier food items. At the same time, wholesale inflation is at an all-time high of 13.56 per cent. Due to rising inflation, the purchasing power of the people has been affected and the budget of the house has been disturbed. The Finance Minister should emphasize on measures to increase expenditure while controlling inflation. There is a need to emphasize the ways of increasing the savings of the people in the budget. By doing this, money will come in the hands of the people, which will increase the demand, which will work to give impetus to the economy.

4. Providing Affordable Health Services

The healthcare sector has faced a major challenge during the Corona pandemic. Common people have to face a lot of trouble. Experts say that in view of the epidemic like Corona, the Finance Minister should focus on the availability of affordable health services. For this, there is a need to increase the expenditure on health to at least 3 percent of GDP. This will help in better provision of hospital and treatment across the country, which will be a big relief to the low income group.

5. Reducing Fiscal Deficit and Increasing Investment

In Budget 2021, the challenge before Finance Minister Nirmala Sitharaman will be to focus on increasing the fiscal deficit and investment. Excessive borrowing and spending during the Corona pandemic has also increased the fiscal deficit. At the same time, private investment is still very low. This is not creating employment opportunities. At the same time, increasing the fiscal deficit will affect the rating of the country. Measures to avoid this will have to be done in the budget. Along with this, emphasis will have to be laid on doubling the income of the farmers. The agriculture sector has played an important role in handling the country’s economy in the Corona crisis. Prime Minister Narendra Modi has also spoken of doubling the income of farmers by 2022. That’s why everyone’s eyes are on the announcement for the farmers in this budget, because while this announcement can remove the displeasure of the farmers, on the other hand it will also be helpful in increasing the income of the farmers.

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