Nirmala Sitharaman on Budget 2024: ‘Opportunities not adequate, job schemes to benefit 4.1 crore youth’

When I say I’ll review the income tax… there’s a lot that needs simplification. We’ll work towards it. So you don’t need to read such a big book on income tax, it’ll just be a simple form. Even the follow-up should be simple

Can you clarify if older schemes like MGNREGA, Rashtriya Swasthya Bima Yojana and PM-Kisan will continue?

Absolutely. In my speech, which was one and a half hours long, how many subjects will I be able to cover? Several states complained that I did not talk about them in my speech. This does not mean that no money will go into that state. Every scheme is functioning in that state. Apart from these schemes, even those projects that are being carried out in those states with the help of the help of the World Bank and the Asian Development Bank will continue. In the last 70 years, the country did not think of Maharashtra.  It will soon get the Vadhavan Port, the country’s largest, which will draw some of the best large vessels to Indian shores.  Our Cabinet has approved Rs 76,000 crore for that project. But was it mentioned in the Budget? I want to clarify that existing schemes will continue.

You did mention projects for Bihar and allocation for Andhra Pradesh. Are you sending out a special message here?

No, first of all, the Andhra Pradesh Reorganisation Act required all this to be done anyway. In the ten full years since the AP Reorganisation Act came into being — the two states were bifurcated — we have been giving money for the backward districts programme, taking some of the primary institutions — AIIMS, IIT, IIIT — (to the state). So there are certain projects which are getting staggered. Polavaram is one of the biggest national irrigation projects with a dam, storage capacity being immense, Godavari waters being kept there, and from there irrigation going into the fields. This is a national project, we will certainly support it, and that is what I have emphasised. Similar is the backward region development in Andhra Pradesh — Rayalaseema and north coastal Andhra Pradesh — are all part of that. We are only definitely assuring the newly elected government in Andhra Pradesh that we are with them.

We will stand by them, we will ensure those promises which are given in the AP Reorganisation Act will be fulfilled.

You announced projects worth Rs 47,000 crore for Bihar in a speech. Can you talk about it?

Every year, north Bihar goes through loss due to floods. It makes you feel sorry. If you analyse this, it is not Bihar’s fault; the rivers are coming from Nepal. We have been talking to the Nepal government for years. It is nobody’s fault. But there has been a delay. Till the matter is resolved, will Bihar get some relief or not? Therefore, we launched the Kosi-Mechi project. We are trying to divert the scattered water for irrigation so that Bihar does not suffer due to floods.

How will these e-commerce hubs that are being set up with the public-private partnership work and how will the benefiting MSMEs reach the international markets?

The e-commerce hubs, we announced it for the MSMEs. You look at the example of what this open network for digital commerce (ONDC) is doing. It’s actually given at the cost of the government, meaning they don’t have to pay any charge for it, access for MSMEs to reach the global markets. ONDC has proven a very powerful catalyst. Now when you form e-commerce hubs, you are making sure because of these digital assets that we have, and MSMEs in particular can benefit from, it’s like creating a special economic zone, somewhat.

It’s one thing you give MSPs, PM-Kisan… But farmers today require high-quality seeds and better inputs, and we need good research. I announced 109 varieties of climate-resilient seeds, both for field crops and horticulture

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In the new tax regime, you had kept no tax till Rs 7 lakh. Under the new slab, what’s the motive? You said you’ll review the Income Tax act in the next six months. Are we going towards a direct tax code?

Yes. We are moving toward it to simplify it. Why was the new tax regime needed? Instead of filling forms in the same system with a hassle, whether you need an exemption or not, come into this system. Rate is less too. If you don’t need exemptions, you’re getting a better rate here.

Secondly, after the scheme’s launch, people said to give the minimum possible standard deduction. We took it till Rs 50,000. This time, that has been raised to Rs Rs 75,000. So that people have money left in their hand.

Apart from this, even in the rate, we’ve simplified and reduced. So the middle class gets relief in income tax, and we’re moving to have more money in their hands. This time, with the tax rates and standard deduction, it’s relief for the middle class.

When I say I’ll review the income tax… I gave the example of the old and new regime, but there’s a lot else that needs simplification. We’ll work towards it. So you don’t need to read such a big book on the income tax, it’ll just be a simple form and you can file taxes. Even the follow-up should be simple…

And your overall tax proposals, you talk about a revenue foregone of about Rs 7,000 crore. So is this a shortfall, or do you hope to make this up because we are having growth and tax GDP ratio is going to improve?

Yes, because the way in which we have decided to spend money in building capacities, in making sure there are more efficiencies brought, productivity increase, and making sure youth get trained properly to get into good quality jobs… all this will generate economic activity which will give me that comfort to make up for revenue foregone. Which net out, I read it out today, that Rs 7,000, Rs 8,000 crore we can, we hope. Because the ways in which we are bringing in factors for productivity gains will help us.

And other than that, of course, we also make sure that the tax net is widened…

How will the youth benefit from the schemes announced in the Budget?

…Today, for instance, in scheme one, if you recruit a new fresh employee, the government will give Rs 15,000 as one month’s wage, which will be spread in three instalments. In this, the employer also receives because he’ll register him as an EPFO employee. This is one scheme. Here, the employee and employer get incentive.

The second scheme looks at employees which are first time, and also for somebody else who can get into the job, for him we give allowances for both employee and employer. In this, if the employer doesn’t retain him for two years, and removes him within a year, let’s say, every incentive given to the employer will have to be refunded or paid back.

We are making sure that under each scheme, there are more and more new people coming in, fresh appointments happening, companies will be incentivised to grow. Suppose you’re already running a company of 100, and you can get 50 more, you get the incentive.

Its your seventh budget. What framework do you see for the economy?

Like our president said, our budget has a futuristic vision. Technology has been included. Training our youth for Industry 4.0 is not because we don’t have jobs or something like that. Train youths in such a way that they’re job-ready. We’ve got a cruise to India. It will increase employment, tourists, there’ll be hotels in each centre, people who work there will increase, opportunities for handicraft will increase.