Union Budget 2023-24 promises a bright future for India

The Budget this year promises a bright fut­­­­ure for India. The govern­m­ent has to be comme­n­ded for the increas­ed tax collections, cont­­­ai­­­­n­ment of fiscal deficit despite an increa­sed capex progra­m­­­­me and still betting on 7 per cent plus GDP grow­th despite global tailwinds.
 
It is evident that India’s Finance Minister has stuck to a broad growth strategy that was unveiled a couple of years ago. She has clearly aimed the Budget to incentivise the private sector in the economy to invest in the productive capacity, thereby creating jobs and pushing growth. At the same time, the government has been consistently increasing its capital expenditure and raising more revenues via disinvestment. The fiscal prudence displayed has been exemplary.

 
Particularly refreshing was the increase in capex for infrastructure development outlay.  The budgetary allocation towards capital investment will rise by around 33 per cent to Rs 10 trillion. Moreover, the government is also setting up an Agri Accelerator Fund to encourage agri startups in rural areas.
 

In the healthcare segment too the Finance Minister has thought long-term. In FY23, the healthcare expenditure on GDP has gone up to 2.1 per cent from 1.4 per cent in FY19. With Ayushman Bharat gaining ground, it is time to prepare the nation with a robust healthcare infrastructure.
 
The pharmaceutical industry’s request to incentivise and encourage R&D investments has been granted. The new Centers of Excellence programme, aimed to promote R&D in pharma, will encourage investment opportunities that will fuel innovation in the sector. It will not only begin to unleash the high potential of India’s rich scientific talent, this will further encourage the industry to invest in R&D.

 
This year, the government has announced significant measures to encourage collaborative research and innovation between the academia and the industry. Making select ICMR Labs available for research by public and private medical college faculty and private sector R&D teams is one. Another is setting up of three Centres of Excellence for Artificial Intelligence in top educational institutions. This partnership will help in interdisciplinary research and in developing cutting-edge applications in the area of healthcare.
 
Dedicated multi-disciplinary courses for medical devices in existing institutions to ensure the availability of skilled manpower for futuristic medical tech­­­­­­­­nologies, high-end manufacturing and research will further strengthen the nation’s healthcare.

 
The Indian government has rightly focused on infrastructure capex to boost the economy and generate employment, given that infrastructure has a double multiplier effect on economy. Setting up new nursing and medical colleges in the hinterlands of the country is a welcome move.
 
The PLI schemes announced across 14 areas are seeing success in capitalising on the shift in global supply chain as most companies adopt China+1 strategy. This is providing a significant boost to new investments in the manufacturing sector, with record number of project announcements in the last 12 months. India’s pharma sector with its dependence on API imports is also getting benefitted by the PLI scheme.

 
Another need of the hour was to boost consumption, particularly in an inflationary environment and against global tailwinds of looming recession. The rationalisation of income tax, particularly for the salaried class and the MSME entrepreneurs will enhance disposable income and further boost consumption in the country.
 
In the current turbulent global environment, India has emerged as a beacon of resilience and stability due to the actions/policies adopted by the government. The last couple of years have resulted in India being one of the fastest growing economies, while fears of recession prevail in the US and Europe.  It is time for India to be bold and invest to create conditions that will stimulate further economic activity. The country clearly has a growth agenda and this Budget is designed to boost private sector investment and promises to propel India’s growth further.

 
This Budget has its tasks cut out for everyone. Digitalisation, Innovation and Co-operation are the three pillars from which the budget makes the clarion call to all the stakeholders — industry, companies and citizen — to prepare India for its 100 years of independence in 2047.
 

The writer is Managing Director, Sun Pharma