Modi Government / The first budget of the New Govt will focus on the economic agenda, command in the hands of Sitharaman

Vikrant Shekhawat : Jun 11, 2024, 08:28 AM
Modi Government: Nirmala Sitharaman has once again been given the command of the Finance Ministry amid Prime Minister Narendra Modi's priority of policy continuity. Sitharaman can put forward the economic agenda of the government while presenting the first budget of the new government next month. However, it will not be easy for Sitharaman to do so. She will have to consider measures to accelerate economic growth without affecting inflation. Along with this, she will also have to look for resources keeping in mind the compulsions of the coalition government. Sitharaman has also been the Finance Minister for five consecutive years in the second term of the Modi government. During this time, she played an important role in taking forward the economic agenda of the government and the country emerged as the fastest growing major economy in the world.

Will take over the reins of the Finance Ministry again

After winning the recently concluded general elections, the government was once again formed under the leadership of the Prime Minister on Sunday. During this, Rajya Sabha member Sitharaman also took oath as a cabinet minister. The economic agenda of Sitharaman, who is going to take over the Finance Ministry in the new government, will include steps to make India a five trillion dollar economy and accelerate reforms to transform the country into a 'developed India' by the year 2047. The new government has inherited a strong economy with fiscal prudence. The Rs 2.11 lakh crore that the government recently received from the Reserve Bank as dividend for the financial year 2023-24 can prove to be very helpful for its fiscal position. The key policy priorities of the third term of the Modi government will include dealing with stress in the agricultural sector, job creation, maintaining the pace of capital expenditure and promoting revenue growth to remain on the path of fiscal consolidation.

The world will keep an eye on these issues

However, despite the jump in tax revenue, non-tax revenue remains a challenge. This is because strategic disinvestment is almost negligible. Strategic sale of several central public sector enterprises including Shipping Corporation, NMDC Steel Limited, BEML, PDIL and HLL Lifecare is still in process. IDBI Bank is also stuck in security and proper and due approval of bidders. The government is also facing a lot of opposition on the banking sector reform front. It has not been able to push forward the policy of privatization of insurance companies along with some public sector banks.

Will have to work hard on slab rationalization

Despite the monthly Goods and Services Tax (GST) collection being comfortable in terms of tax revenue, the GST Council headed by the Union Finance Minister will have to work hard with tax rate and slab rationalization to introduce GST 2.0. Sitharaman took charge of the Finance Department in the year 2019 and since then she has been continuously discharging this responsibility. She is the first full-time woman Finance Minister in independent India. Under her leadership, the country also faced the very adverse situation arising from the Kovid-19 epidemic.