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Feature: India Budget Analysis

Budget 2021 -22 lays the foundation for a New India: FICCI With this union budget, the Indian government is sending out clear signals that it is ready for the next decade, according to Manish Singhal, Deputy Secretary General at FICCI.

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Union Budget in India is like a Festival of sorts as it’s much more than a budget as we call it. It’s a combination of State of the Union address, plus an account of the Government’s financial performance, plus, more importantly, a vision statement for the next decade. With such a holistic view of the economy, it also is perhaps the ‘biggest challenge for any Indian finance Minister, to keep both pessimists and optimists satisfied’, as some people say. Indian Union Budget 2021, the first paperless one in the history of independent India, has been proclaimed as one of the landmark Budgets. In many ways, it serves as a blueprint meant to prepare India to take its rightful place in the new global order. The announcements remain aligned to the policy course seen over the last year to deal with the pandemic while keeping the broad vision of creating a ‘New SelfReliant India’ intact. FICCI believes that the Indian government has done a laudable balancing job in addressing both the health and economic crisis.

minimum government - maximum governance. The post-COVID world offers India the unique opportunity to become self-reliant and evolve into a global hub for business. We believe that this budget throws up huge opportunities for investors especially in areas like healthcare, infrastructure, Emerging technologies, Startups and insurance. New Zealand can be an ideal strategic partner for India in its journey to achieve a transformative and inclusive economic growth.

This was ratified by the unprecedented surge in our stock markets, achieving all-time highs. At the same time, economic activity is gaining traction and most of the sectors have moved closer to pre-covid operating levels.

This comes on the back of an attractive corporate tax rate of 15% This was ratified by the for new manufacturing companies unprecedented surge in our stock and the PLI (Production Linked markets, achieving all-time highs. Incentive) schemes. The scheme will At the same time, economic activity make “Indian manufacturers globally is gaining traction and most of competitive, attract investment in the sectors have moved closer to the areas of core competency and pre-covid operating levels. The rapid cutting-edge technology”. FICCI vaccination drive is supporting the believes this move will lead to more V-shaped recovery and is expected to inclusive growth and shall create keep the momentum going in most huge employment opportunities. sectors. With global supply chains undergoing a strategic shift, India must grasp the Our Prime Minister’s vision opportunity with alacrity. There are of an “AatmaNirbhar Bharat”, global value chains that are looking in a globalised economy, was to shift to India, and New Zealand commendably augmented by our can explore Indian market in every Finance Minister Ms. Sitharaman, aspect of economic engagement. by presenting the budget proposals India-New Zealand economic on six pillars – health and wellbeing, cooperation has enormous potential physical and financial capital for growth, which can bring great and infrastructure, inclusive economic and strategic benefits development for aspirational to both nations. New Zealand can India, reinvigorating human consider scaling up their niche capital, innovation and R&D, and technologies in India, for supplying

to the large Indian market and to the world.The healthcare sector was at the focal point in the past one year. The increased total budget outlay for healthcare is a big step for strengthening the delivery system and building better capability and capacity to address the current challenges as well as combat any future pandemics. FICCI is happy to note this budgetary allocation for the healthcare/ well-being sector – which marks a 137% year on year increase and sets a historic precedent by being the highest ever. India and New Zealand can partner for innovations & affordable technologies in the healthcare sector. The 2 countries can also collaborate in research programs between Institutes for healthcare and medicine focussing on vaccine development, therapeutics and diagnostics. New Zealand can also consider investment opportunities to develop hospital chains and diagnostic labs in India. Furthermore in the budget 2021, the emphasis on infrastructure, transport in urban areas, affordable and rental housing will have a compounding effect on the economy. We are happy to see that the government has laid emphasis on garnering adequate capital resources for the sector in the Union Budget. The announcement to set up a Development Finance Institution is welcome and has been a long-standing demand from FICCI. India and New Zealand can work together on infrastructure financing with opportunities to tap into funding required for development projects available under NIP in India over the next 5 years. The increase in the FDI cap from 49% to 74% in the insurance sector will also help draw long term funds for meeting the investment requirements of the infrastructure sector. In addition, the announcement to set up a new special purpose Asset Reconstruction

22 | KiaOra India | Mar 2021INZBC.ORG

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KIA ORA INDIA | VOL 3 ISSUE 01 | MAR 2021  

KiaOra India is a quarterly trade magazine, published by the India New Zealand Business Council. This magazine is published every quarter an...

KIA ORA INDIA | VOL 3 ISSUE 01 | MAR 2021  

KiaOra India is a quarterly trade magazine, published by the India New Zealand Business Council. This magazine is published every quarter an...

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