Budget and Economies of scale for 2023-24

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A budget is known to be a balanced one when the estimated expenditure is expected to be equal to estimated receipts in a financial year. This type of budget is based on the principle of 'Living within means' and is believed that Govt. expenditure should not exceed the revenue. A balanced budget, though is based on ideal approach to maintain fiscal discipline, but such budget does not ensure of  financial stability at times of depression or deflation. Such budgets donot provide any solution to unemployment and,as such not suitale to less developed countries as it restricts their expenditure and limits their economic growth.Theotrically it is easy to balance the budget,but when comes to its implementation, such balance is hard to achieve. 

In India, economy has vast resources like manpower, techniques, minerals  and financial services. The main issue, as I think is to balance and use these resources in such a manner to accelerate the economy. A glance at the following will prove to be friutful if implemented.

1. EDUCATION - This is the main trigger to give a boost to the economy as well a great source for consolidation of family budget both in short as well as long run. All the education facilities are provided/ being provided both in urban and rural sector to the youth. Education should also focus on development of attitude, behaviour subjects which will infuse honesty and love for the country among the students. 

Funding can be managed by creating 'Interest Differential Fund' from out of FDI investments coming to India. To be clear on this, it is to be noted that rate at which foreign investment /borrowing comes to India through Govt.channels at the lesser rates as compared to the rate which is charged from the local industries/companies. This difference can be created as 'Interest Differential fund' to fund the education sector in the country. It will reduce financial burden on the Govt as well.

2. EMPLOYMENT - Govt. should consider giving incentive to start up ventures/services as also to  provide soft loans. This will boost employment to the youth as they are educated - can set up their own establishments either to give jobs to the  youth. 

Manufacturing startups should focus on substituting the imported items with the country made products thereby restricting imports and target for export of such items at the competitive rates in the global market. 

Soft loans can also be considered for the established industries to increase their production capacity by employing more workforce in order to make their products available in the global market at the competitive rates. This will not only make Rupee stronger but shall prove to strengthen foreign exchange resource.

3. TAXATION - With the expanded workforce and more money in the market, inflation is likely to be contained. Govt. may consider relaxing tax rates since the revenue will increase due to above measures  ( if implemented ). Standard deduction increase will certainly motivate taxpayers to be more functional in payment of taxes. Govt. revenue overall will certainly increase.

4. INFRASTRUCTURE - Construction of roads, building covers of a wide spectrum of financial sector to boost the economy while providing jobs to skilled and unskilled workers, cement, iron industry and its allied services.   

4. Involving youth in jobs like construction and implementing flood control measures, more power and water supply to agriculture, installation of wind mills in rural areas, development and operation of old forts, palaces in various parts of country to tourist resorts and their related services will boost more job opportunties. 

It is expected that the Govt. may consider these measures and let us wait for the Budget for 2023-24.

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