Through public spend, there will be crowding in of pvt investments: FM

Earlier, India did not use to have the resources. But now, back-of-the-envelope calculations suggest that at least Rs 20 trillion of resources are available. Which means you need about Rs 60 trillion worth of projects. So we do not have at this stage, the shovel-ready projects, do you think that will pose a constraint on this growth?

No, I don’t think. Since after the introduction of the National Infrastructure Pipeline, which was end ’19 and early ’20, we had been adding a lot of projects as well to that list and many states have come with very well-designed projects with which we are able to move forward. Over and above what is in that, there is also a keenness now among states to compete for renewable energy related projects. We find a lot of states coming up with very doable projects, and also when sovereign funds from abroad come to India, they are looking for projects, which are scalable. They want projects of that size, they don’t want to invest in ten projects, rather invest in two. We’ve also given them a lot of fiscal benefits and the emphasis that PLI has brought in, … the business has understood that it is for incentivising production at a scale. So every unit that is getting added, is getting added to a particular level. Many states have shown keenness even on that, and therefore I see the approach to large projects, which has an impact, multiplier effect, impact on immediate job creation.

Does the Budget recognise cryptos as an asset class but not as a currency?

I am not yet doing any of that … I want you to give me the opportunity to explain it. There is a process of consultation, which is going on, about crypto … Before the consultation is completed, I won’t be able to do anything on regulating them or formalising a framework for regulation for them, this is one side of the story. Second is, everything that is crypto cannot be a currency. What is a currency? A currency is something which is issued by as a fiat. It is issued by the authorities concerned, by the government or the central bank. If they show something, even if it is digital, only then can it be currency. What happens in the world of crypto, otherwise, is they are creating very many different types of assets, using the digital technology and also using the distributed ledger technology. All of them are not necessarily currency. Currency is that which comes from a central bank, which has the authority to issue currency. So what we have now made a provision for, is for the Reserve Bank of India to issue a digital currency. And that obviously will be riveted in, or based on certain value of gold, or money or government assets or something of that kind. So it will be asset-backed. It will be sovereign-backed in a way, so that is what is currency. The rest … we don’t know yet how we are going to regulate them, because consultation is going on. However, because there is a lot of buying and selling and transacting, resulting in some kind of a profit and it is a sovereign right to tax such transactions and profit making, I have come up with a proposal for a taxation on them and that is to an extent of 30 per cent for profits earned out of such transactions and also a TDS. So that I know who is buying and selling. In the sense, what is the transactions about, money trail, whether it is a) money or b) money … whatever. So, the taxation is on those activities, which are not currency, currency is with the Reserve Bank, but these are some kind of assets being bought and sold, various types of it, I am taxing them.

You have assumed a growth of 11.1 per cent in the next fiscal. What is the logic of this?

It’s not underpromising, it’s being realistic, one. And secondly, when last year’s Budget was brought in, we hadn’t seen Omicron, we hadn’t seen the second wave, at that time, before the second wave, I had given the, Budget. Now second wave has come, hopefully it has gone, now Omicron is on, but even more you have the US Fed, you also have the international crude oil prices going up, metals have become very expensive. So, we will have to keep all this in mind. We are not getting into details of which is considered a challenge, which is considered a headwind, which is not, but at the same time, I think Prime Minister has been very clear that we will have to work out to make the Budget a lot more…a speaking document, it should say what it has, there’s no point in saying things beyond a certain…and that’s what we have followed.

The middle-class have been hurting for the last two years and the anticipation among them is always linked to some tax-break. So, I heard you, you said that I did not raise taxes for the last two years. So, what is your message for the middle-classes?

I fully recognise, every section of the society has suffered, middle-class has definitely suffered but when we talk about middle-class I understand, you understand, all of us understand and each of us also perceive that there is an element of middle-class in us also and therefore we understand the element of suffering. But yet we also belong to some other group, for instance if you or your brother or your son would start a startup and he gets benefits, isn’t that middle-class? If his children are going abroad and if I give them all the facility to transfer money for their education abroad and give them also a passport, which is going to be futuristic and ensure that when they come back they can have a skilling programme and I also make sure that high-class universities are set up in India, isn’t that not addressing the middle-class? And similarly, would we want to think that the farmers are not middle-class? Would they not get benefits, will we think that the MSME running person is not middle-class, so middle-class is a large spectrum, which has that middle-income as being the common factor, but are spread across the board, in one or the other way the government is dealing with it. Affordable housing, is that not for middle-class?

Transcribed by Mehr Gill