Discontinuation of Job Creation Focus
The 2025 Budget did not address the Prime Minister’s Package, aimed at creating job opportunities for 4.1 crore youth, which was a key focus of the previous Budget.
The future of the employment-linked schemes, such as the Employment Linked Incentive scheme, looks uncertain, with little progress made.
Deflationary Effects and Budget Cuts
The Budget reduces government expenditure significantly, including cuts to capital expenditure, welfare schemes, and rural development programs.
Public spending on rural areas, agriculture, education, health, and infrastructure is severely cut, impacting consumption and investment, especially in rural regions.
Income Tax Relief vs. Limited Impact
While the income tax rebate for individuals earning up to ₹12 lakh is increased, only 22% of India’s salaried workforce benefits from this.
The rebate, estimated to cost ₹1 lakh crore, is seen as insufficient to boost overall consumption, especially for the majority of low-income workers who would have benefitted more from indirect tax cuts.
Inadequate Economic Strategy
Despite tax cuts boosting corporate profits, they have not led to higher investment or job creation in the private sector.
The government's reliance on tax breaks to stimulate demand, while slashing expenditure, is unlikely to achieve the desired economic growth and employment generation.
The overall strategy appears lacking and ineffective.
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