Congress general secretary Jairam Ramesh. File
| Photo Credit: PTI

The Congress on July 12 said the forthcoming Budget must address fundamental questions such as why private investment is “very sluggish” and private consumption is not picking up as the party dismissed claims that economic growth is accelerating sharply and large numbers of jobs being created.

Union Finance Minister Nirmala Sitharaman is scheduled to present the Budget for 2024-25 in the Lok Sabha on July 23.

Congress general secretary, in-charge communications, Jairam Ramesh said, “The non-biological PM’s cheerleaders and drumbeaters claim that economic growth is accelerating sharply and that jobs are being created in large numbers. But if this was the case — and it is not — Why is private investment, a key engine of economic growth, still so very sluggish recording a 20-year low during April-June 2024? Why is private consumption, another key engine of economic growth, not picking up except at the high end,” Mr. Ramesh asked.

“Why have household savings plummeted to record lows and household debt shot up to record highs? Why have rural wages continued to fall and why is the wage share of national income declining?” he said, adding, why is manufacturing as a share of GDP at a record low and still decreasing? Why has the informal sector lost 17 lakh jobs in the last seven years? Why did unemployment reach a 45-year peak, with unemployment for young graduates at 42%?” the Congress general secretary said.

“These are fundamental questions that the forthcoming Budget will have to address while the Finance Minister sings praises of the non-biological PM,” Mr. Ramesh said.

On Thursday, the BJP claimed that around 12.5 crore jobs were created in the last 10 years of the Modi government and cited the latest Reserve Bank of India report to assert the creation of “five crore jobs in 2023-24 alone”.

Several experts have urged the government to provide tax relief to the common man to boost consumption and take steps to check inflation and accelerate economic growth.

The economy has recorded a growth rate of 8.2% in 2023-24. Earlier in February, Ms. Sitharaman presented an Interim Budget for 2024-25 in view of the Lok Sabha elections.

Union Finance Minister Nirmala Sitharaman addresses the Federation of Indian Chambers of Commerce and Industry (FICCI) National Conclave on ‘Viksit Bharat@2047’, in New Delhi on February 27, 2024.
| Photo Credit: ANI

Finance Minister Nirmala Sitharaman on February 27 exuded confidence that India Inc will align itself to the developmental goals of the nation with an objective of making the country a developed nation or ‘Viksit Bharat’ by 2047 on the 100th anniversary of independence.

Ms. Sitharaman said Prime Minister Narendra Modi has clearly indicated that the goal of Viksit Bharat is to be attained to provide the future generations a better India.

Addressing a session on ‘Viksit Bharat @ 2047: Viksit Bharat & industry’, organised by FICCI, the minister said that industry’s role is critical in achieving the goal by 2047.

“You were with India during the freedom struggle, you built industry and capacity despite the colonial pressure…So Indian industry has always kept that spirit up and against terrible odds kept moving along on national interest.

“I can’t see how they will be left out in this game of building a developed India by 2047. So it should be natural to India’s industry to align itself with India’s developmental interests, and after all industry will be the first contributor as much as the first beneficiary…,” the Minister said.

The Finance Miniter also assured the industry that reforms will continue in the third term of the Prime Minister Narendra Modi-led government.

The new government will be formed after the general elections due in April-May and the BJP is confident that Prime Minister Modi will return to power with a greater majority.

Ms. Sitharaman said that India has moved up to become the fifth largest economy and is on the way to become the third largest global economy.

Even after Covid, she emphasised that the government showed its commitment by ramping up capital expenditure. Indian industry can now surely move forward with a great speed globally as investments are coming in.

It is time for the Indian industry to also capitalise, the finance minister said.

She said that several reforms were undertaken by the government during the last 10 years and the trend will continue.

She said that the reforms to be undertaken by the next Modi government will touch on factors of production.

The Minister further said today, without digital infrastructure, no country can move at a pace at which it wants to achieve developmental goals for its own citizens.

India, she said, has shown how making investment in creating the digital infrastructure at the bottom, and scaling it up, led to creation of ‘India Stack’.

“…other than the traditional factors of production like land, labour, capital and the enterprise, I would put digital infrastructure as an important factor, without which we will not be able to scale up and bridge the gap with those who are still aspiring to move forward,” the Minister said.

Ms. Sitharaman also told the gathering that the government is focussing on areas like space and artificial intelligence (AI).

“We have emphasised that India should become a global hub for AI and we will set up centres of excellence for the same,” she said, adding, a great leap forward has been made in logistics.

Whether it is logistics, agriculture productivity or tourism, India has immense potential and government is committed to its policy.

“That is why the prime minister is confident that in the third term we will be the third largest economy. It’s because of the push which he likes to give in these areas, not just fiscal, but legislative and other measures as well,” the Minister said.

Renewable energy has better prospects for not just solar or wind, but the government is also looking at renewing its commitments to hydroelectric power, she said, and added that in green hydrogen and green ammonia, big investments are happening in India.

Union Finance Minister Nirmala Sitharaman.
| Photo Credit: Kamal Narang

Finance Minister Nirmala Sitharaman on July 29 said the focus of the government is on four Is — infrastructure, investment, innovation and inclusiveness — to make India a developed nation by 2047.

She said India has necessary wherewithal to meet the goal set by Prime Minister Narendra Modi.

Besides several investor-friendly reforms undertaken by the government, she said, India has a very vibrant young population and the emphasis on skilling them to suit the requirement of the economy would yield dividend.

With the aim to build India a developed country by 2047, she said “the emphasis has been on four different issues [Is]. We are looking at infrastructure [first I] in a very big way. In the last 3 to 5 years, consistently, the public expenditure for infrastructure building has been ramped up significantly and it will reach Rs 10 lakh crore in 2023-24.” With infrastructure comes investment (second I), she said, adding that emphasis on investment will promote greater participation of both the public and private sector.

So, she said, infrastructure is not just going to be physical such as bridges, roads, ports or airports, but also creation of digital infrastructure is given importance.

“We are looking for both public investment and private investment and creating necessary environment, the ecosystem as we often refer to for attracting private investment. And the global discussions which are going on blended finance is also something which we’re looking at,” she said at an event organised by CII here.

Pointing out that innovation is the third I, she said, “the government has opened up several areas inclusive of the space, nuclear energy, looking at getting out of fossil fuels. We have enough reason to believe the youth today are giving us solutions, which are very good for the frontier technologies that we’re talking about, as much as for the legacy issues which persist in India for which we need solutions.”

On the fourth I, inclusiveness, she said, “as we aim to reach for the developed nation in 25 years by focussing on inclusiveness, making sure that every section of India, the common man, benefits by everything that we do [whether] investment or reforms are trying to take schemes to the people.”

Clean green hydrogen energy generation.
| Photo Credit: Getty Images/iStockphoto

Underlining a commitment to accelerate the Indian economy’s transition to one powered by green energy, Union Finance Minister Nirmala Sitharaman in her Budget speech on Wednesday mentioned a slew of schemes aimed at promoting clean energy and sustainable living.

Green energy was among the ‘Saptarishi’ or seven guiding lights Ms. Sitharaman mentioned in her address that would steer India through ‘Amrit Kaal’ (next 25 years).

She said the Ministry of Petroleum and Natural Gas had earmarked ₹35,000 crore for “priority capital investment”, though neither her speech nor the Budget documents provided more clarity on it.

Following up on the government’s recent announcement of giving a push to ‘green hydrogen’ and promoting renewable energy projects, the Minister said battery energy storage systems with a capacity of 4,000 megawatt hours will be “supported” with viability gap funding to encourage investment.

The Budget also waived customs duty on capital goods and machinery for lithium-ion battery manufacturing. The move is expected to make electric vehicles and storage systems cheaper.

Boost for solar projects

The Ministry of New and Renewable Energy has received a budgetary allocation of ₹10,222 crore, a 45% hike from the ₹7,033 crore it expects to spend in the current financial year. The most significant hikes in the Ministry’s programmes are for ‘off-grid’ solar projects, on which the government is expected to spend ₹61 crore in the current fiscal but has budgeted ₹360 crore for the coming financial year.

India had a target of installing 100 gigawatt (GW) of solar power projects by 2022 but has only installed 63 GW. Off-grid solar projects constitute less than 5% of the target. The allocation for solar power expected to be supplied to the grid has been raised to ₹4,970 crore, up from the ₹3,469 crore expected to be spent by March 2023. The National Green Hydrogen Mission – a ₹19,000-crore programme to produce, use and supply hydrogen from renewable energy sources – has been allotted ₹297 crore.

3 key measures

“For the budget allocation of ₹35,000 crore (about $4 billion) to start catalysing the nearly $30 billion in energy transition finance required annually by India for its net zero future, three types of measures will be needed: risk guarantees to reduce the cost of capital for low-carbon investments in the country; demand aggregation measures as has been done for LED lighting and electric buses; and viability gap financing for hydrogen electrolysers and offshore wind as announced for battery storage,” Ulka Kelkar, director, World Resources Institute, said in a statement.

Ms. Sitharaman also mentioned a ‘green credit’ programme to be notified under the Environment (Protection) Act. “This will incentivise environmentally sustainable and responsive actions by companies, individuals and local bodies, and help mobilise additional resources for such activities,” she said. “Building on India’s success in afforestation, the Mangrove Initiative for Shoreline Habitats and Tangible Incomes (MISHTI) will be taken up for mangrove plantation along the coastline and on salt pan lands,” she added.

An official in the Environment Ministry, who declined to be identified, told The Hindu that such a programme would be “sweeping” and involve multiple Ministries. “It’s still being finalised. However, it will involve several existing schemes that incentivise emission reductions by industries or the growing of plantations in barren land [that become stores of carbon over time].”

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The Eklavya model residential higher secondary school at Kumizi in Tamil Nadu’s Kancheepuram district. Photo: tntribalwelfare.tn.gov.in

The Union Government will hire 38,800 teachers and support staff for Eklavya Model Residential Schools (EMRS) for tribal students across the country over the next three years, Finance Minister Nirmala Sitharaman said on February 1 during her Union Budget 2023-24 speech in Lok Sabha. 

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Ms. Sitharaman said, “Centre will recruit 38,800 teachers and support staff for the 740 Eklavya Model Residential Schools, which is serving 3.5 lakh tribal students.”

This announcement comes months after The Hindu reported in September last year that EMRSs across the country were running with less than half the number of teachers recommended by the National Education Society for Tribal Students (NESTS), the managing authority of EMRSs.

Data available with the NESTS showed that even among these, more than 70% of teachers were either contractually recruited or on deputation from State government schools. 

NESTS officials had said that they were not being able to fix the teacher shortage because of the structure, under which NESTS does not have power to direct State Education Societies for Tribal Students (SESTS). 

Senior officials in the Ministry of Tribal Affairs said that the Department of Expenditure had already approved a change in the structure, enabling NESTS to take control of all recruitments. The Ministry has already written to the Central Board of Secondary Education to begin the recruitment of teachers as soon as possible.

“This year, we will recruit at least 10,000 teachers for the EMRSs across the country,” the official said, adding that the teachers currently appointed temporarily or on contract will also be given a chance to apply for these vacant positions and will be considered provided they are qualified as per NESTS guidelines. 

Currently, only 401 of the 689 sanctioned EMRSs are functioning and catering to a total of 1.13 lakh tribal students, according to Ministry of Tribal Affairs data. Ministry officials said that they intend to make another 50 EMRSs function by the time the next academic year begins. 

Budget 2023 | What’s cheaper and what’s costlier?

NESTS officials have said that once the new management structure kicks in, the SESTSs will be scrapped providing for regional offices of the NESTS to take up the direct management of the schools on the ground.

The Ministry’s Budget for FY 2023-24 showed that nearly half of its entire allocation for the year has gone to the development and management of EMRSs — coming up to ₹5,943 crore out of the total ₹12,461.88 crore allocation for the Ministry of Tribal Affairs.

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