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Wednesday, Oct 27, 2021
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Union Budget 2020: What FM Nirmala Sitharaman Can Do To Pull Economy Out Of The Rut

Union finance minister Nirmala Sitharaman has little option but to bite the bullet to put the spark back in the faltering Indian economy

Union Budget 2020: What FM Nirmala Sitharaman Can Do To Pull Economy Out Of The Rut
Photograph by PTI
Union Budget 2020: What FM Nirmala Sitharaman Can Do To Pull Economy Out Of The Rut
outlookindia.com
2020-01-27T12:53:35+05:30

In the past seven months, Union finance minister Nirmala Sitharaman has announced more policies than what were included in her first budget in July 2019. It’s a different matter that most of the budget decisions were rolled back. Now, she is about to present her second budget amid rumours of a Cabinet reshuffle, a perceptible lack of confidence within India Inc, and dark clouds of a global economic crisis hovering overhead. It was also not lost on anybody that the finance minister was absent from a recent meeting convened by Prime Minister Narendra Modi with top economists ahead of the Union Budget.

Sitharaman has her task cut out—Asia’s third largest economy is struggling against headwinds of a prolonged economic slowdown that has seen thousands of job losses amid backbreaking setbacks across sectors. Against an ambitious target of making India a $5-trillion economy by 2024, the government has predicted a GDP growth of around 6 per cent in 2019-20, the slowest in 11 years. It’s a bad time to be the finance minister. But a flurry of recent and hectic decision-making has raised expectations. A corporate chieftain says this is Sitharaman’s opportunity to present a dream budget. Days before the presentation, the FM claimed that she was working to end the “trust” deficit with India Inc. Everyone seems to be talking about a few “big-ticket” announcements. Each sector expects goodies from the budget bag. However, this may not be an easy task given the current fiscal constraints and domestic and global challenges.

From the FM’s perspective, the tasks are simple. She has to put more money in the hands of consumers, as she did for India Inc when she slashed corporate tax from 30 per cent to 22 per cent a few months ago. She has to initiate steps to enhance public investment and...

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