The govt. moved
- from a discretionary administration to a policy and system based administration;
- from favouritism to transparency and objectivity in decision making;
- from a blanket and loose entitlements to targeted delivery; and
- from informal economy to formal economy.
The International Monetary Fund (IMF) estimates that world GDP will grow by 3.1% in 2016 and 3.4% in 2017. The advanced economies are expected to increase their growth from 1.6% to 1.9% and the emerging economies from 4.1% to 4.5%. Growth in a number of emerging economies is expected to recover in 2017, after a relatively poor performance in 2016.
There are three major challenges for emerging economies.
- The Monetary Policy of US Federal Reserve to increase policy rates more than once in 2017, may lead to low capital inflows and increase in outflows from the emerging economies.
- Uncertainty in commodity prices especially that of crude oil may have significance influence on the financial situation of the emerging economies; However, the increase in oil prices would get tempered by the quick response from producers of shale gas and oil. This would have a sobering impact on prices of crude and petroleum.
- Pressures for protectionism are building up.
CPI inflation declined from 6% in July 2016 to 3.4% in December, 2016 and is expected to remain within RBI’s mandated range of 2% to 6%.
India’s Current Account Deficit(CAD) declined from about 1% of GDP last year to 0.3% of GDP in the first half of 2016-17. Foreign Direct Investment (FDI) increased from ` 1,07,000 crores in the first half of last year to ` 1,45,000 crores in the first half of 2016-17. This marks an increase of 36%, despite 5% reduction in global FDI inflows.
There were two tectonic policy initiatives, namely,
- Constitution Amendment Bill for GST and the progress for its implementation; and
- Demonetisation of high denomination bank notes. This exercise is part of our Government’s resolve to eliminate corruption, black money, counterfeit currency and terror funding.
Thus IMF has projected a GDP growth of 7.2% and 7.7% in 2017 and 2018 respectively. The World Bank has projected a GDP growth of 7% in 2016-17, 7.6% in 2017-18 and 7.8% in 2018-19.
The surplus liquidity in the banking system, created by demonetisation, will lower borrowing costs and increase the access to credit. This will boost economic activity, with multiplier effects.
- Insolvency and Bankruptcy Code;
- Amendment to the RBI Act for inflation targeting;
- Enactment of the Aadhar bill for disbursement of financial subsidies and benefits;
- Significant reforms in FDI policy;
- The job-creating package for textile sector;
- The presentation of the Budget has been advanced to 1st February to enable the Parliament to avoid a Vote on Account and pass a single Appropriation Bill for 2017-18, before the close of the current financial year.
- the merger of the Railways Budget with the General Budget is a historic step.
Budget agenda for the next year is: “Transform, Energise and Clean India”, that is, TEC India. This agenda of TEC India seeks to
- Transform the quality of governance and quality of life of our people;
- Energise various sections of society, especially the youth and the vulnerable, and enable them to unleash their true potential; and
- Clean the country from the evils of corruption, black money and non-transparent political funding.
- The target for agricultural credit in 2017-18 has been fixed at a record level of 10 lakh crores.
- Special efforts to ensure adequate flow of credit to the under serviced areas, the Eastern States and Jammu & Kashmir.
- The farmers will also benefit from 60 days’ interest waiver.
- The Primary Agriculture Credit Societies (PACS) act as the front end for loan disbursements. We will support NABARD for computerisation and integration of all 63,000 functional PACS with the Core Banking System of District Central Cooperative Banks.
- Fasal Bima Yojana, increased from 30% of cropped area in 2016-17 to 40% in 2017-18 and 50% in 2018-19.
- The sum insured under this Yojana has more than doubled from 69,000 crores in Kharif 2015 to 1,41,625 crores in Kharif 2016.
- Soil Health Cards: Government will therefore set up new mini labs in Krishi Vigyan Kendras (KVKs) and ensure 100% coverage of all 648 KVKs in the country.
- Irrigation Fund setup by NABARD, 20,000 Crore to 40,000 Crore.
- Micro Irrigation Fund setup by NABARD 5,000 Crore. Per Drop More Crop.
- For the post-harvest phase, National Agricultural Market (e-NAM) will be expanded from the current 250 markets to 585 APMCs
- Operation Flood Programme: A Dairy Processing and Infrastructure Development Fund would be set up in NABARD with a corpus of ` 8,000 crores over 3 years. Initially, the Fund will start with a corpus of ` 2,000 crores.
- Mission Antyodaya: Bring one crore households out of poverty and to make 50,000 gram panchayats poverty free by 2019, the 150th birth anniversary of Gandhiji.
- MGNREGA, During 2017-18, another 5 lakh farm ponds will be taken up. This single measure will contribute greatly to drought proofing of gram panchayats. Participation of women in MGNREGA has increased to 55% from less than 48% in the past. Budget : 48,000 Cr.
- Pradhan Mantri Gram Sadak Yojana (PMGSY) – 19,000 Cr,
- Pradhan Mantri Awaas Yojana- Complete 1 crore houses by 2019, Gramin from 15,000 crores in BE 2016-17 to 23,000 crores in 2017-18.
- Deendayal Upadhyaya Gram Jyoti Yojana– achieving 100% village electrification by 1st May 2018. Budget: 4,814 crores.
- Deendayal Antyodaya Yojana– National Rural Livelihood Mission for promotion of skill development and livelihood opportunities for people in rural areas. The allocation for Prime Minister’s Employment Generation Programme (PMEGP) and credit support schemes has been increased more than 3 times.
- Swachh Bharat Mission (Gramin) has made tremendous progress in promoting safe sanitation and ending open defecation. Sanitation coverage in rural India has gone up from 42% in October 2014 to about 60%. Open Defecation Free villages are now being given priority for piped water supply. This will be a sub-mission of the National Rural Drinking Water Programme (NRDWP).
- For imparting new skills to the people in the rural areas, mason training will be provided to 5 lakh persons by 2022, with an immediate target of training at least 20,000 persons by 2017-18.
The total allocation for the rural, agriculture and allied sectors in 2017-18 is 1,87,223 crores, which is 24% higher than the previous year.
SWAYAM: Online Platform for Students: This would enable students to virtually attend the courses taught by the best faculty; access high-quality reading resources; participate in discussion forums; take tests and earn academic grades. Access to SWAYAM would be widened by linkage with DTH channels, dedicated to education.
National Testing Agency: an autonomous and self-sustained premier testing organisation to conduct all entrance examinations for higher education institutions. #Free from CBSE, AICTE allow these organisations to concentrate more on acadenics rather on administration.
Skill India mission was launched in July 2015 to maximise the potential of our youth.
Pradhan Mantri Kaushal Kendras (PMKK), These Centres would offer advanced training and also courses in foreign languages. This will help those of our youth who seek job opportunities outside the country.