(As part of a Budget special series by ETMarkets.com, we reached out to money managers seeking their perspective on Budget 2023 with a simple question: What if I were the Finance Minister of India)
As the finance minister of India, I would take several steps that can be taken to improve the country’s economic situation.
Here are five key points that can be considered:
1. Address the issue of high inflation: India has been facing high inflation for several years, and this has led to an increase in the cost of living for citizens and a decrease in the purchasing power of their money. To combat this, the finance minister can focus on reducing food and fuel prices by implementing policies such as reducing taxes for these items and improving supply chain efficiencies. Energy security is one area that has been lacking in India since a long while.
2. Create jobs: India has a high unemployment rate, and this has led to a number of social and economic problems. To address this, the finance minister can focus on creating jobs in various sectors of the economy, such as manufacturing, agriculture, and service industries. This can be achieved by implementing policies such as tax incentives for companies that create new jobs, providing subsidies to small and medium-sized enterprises and investing in infrastructure development.
3. Increase foreign investment: India has a large market and a growing economy, but it is still not attracting as much foreign investment as it should. To attract more foreign investment, the finance minister can implement policies such as reducing red tape and bureaucracy, providing tax incentives for foreign companies, and improving the overall business environment.
4. Improve infrastructure: India’s infrastructure is in dire need of improvement, and this is holding back economic growth. To address this, the government can push more FDI into investing in the development of roads, ports, airports, and power plants and invest in new technologies such as renewable energy.5. Tax net reforms: The poor tax net of India remains a concern as the parallel economy continues to thrive. There is a urgent need to rejig the indirect tax collection and implement it in such a way that direct taxes may become less important in the times to come. Also, some tax incentives to use digital pay systems combined with gradual reduced of paper money using CBDCs can widen the tax net and improve the tax to GDP ratios.
In conclusion, as the finance minister of India, there are several steps that can be taken to improve the country’s economic situation.
By addressing the issues of high inflation, unemployment, increasing foreign investment, improving infrastructure and implementing capital market reforms, the finance minister can help to promote economic growth and improve the lives of citizens.
(The author is a smallcase manager & Founder, Weekend Investing)
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
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