Key Points of Budget 2023
In this budget 2023, the government is focusing on 7 areas and they called it “Saptarishi – 7 priorities”.
- Inclusive development
- Reaching the last mile
- Youth power
- financial sector
- Green growth
- Unleashing the potential
- Infratectute and investment
These are the major areas the government is focused on. these are considered the pillars for the growth of the Indian economy.
Under Inclusive development (sabka saath sabka vikas) in Budget 2023
the government is focusing on multiple areas, here we are going to look the agriculture and cooperatives. The major points are
- Building digital public infrastructure ( inclusive and informative solutions for farmers)
- setting up an agriculture Accelerator fund (encouraging innovative startups in rural areas)
- Horticulture Clean Plant Program (To boost production of high-value horticultural crops)
- Making India Global Hub For Millets
- Targeted Funding 20 lakh crore (agricultural credit targeted at Animal Husbandry, Dairy, and Fisheries sector)
- Setting up of widely available storage capacity (Will enhance Farmers’ remuneration by enabling sale at appropriate times)
Another important area is health. The major focus of healthcare
- 157 New Nursing Colleges to be established
- Sickle Cell Anaemia elimination Mission to be launched
- New Programme to promote research in Pharmaceuticals to be launched
- Joint Public and Private Medical Research to be encouraged via select ICMR labs
The other area which covers under budget 2023 is education and skilling
- Revamped Teacher’s training via DistrictInstitutes of Education and Training
- National Digital Library to be set up for children and adolescents
- States will be encouraged to set up physical libraries at Panchayat and ward levels
Reaching the last mile in Budget 2023
The areas that cover under this, are included below
- Pradhan Mantri PVTG* Development Mission to be launched
- Financial assistance to be given for sustainable micro irrigation in drought-prone regions of Karnataka
- More teachers to be recruited for 740 Eklavya Model Residential Schools
- Bharat (SHRI)^ to be set up for the digitization of ancient inscriptions
Infrastructure and Investment in Budget 2023
The areas that cover under this, are included below
- Incentives to boost Investment in Infrastructure and productive capacity
- Increased capital investment outlay by 33.4% to 210 lakh crore
- Continuation of 50-year interest-free loans to State Governments to incentivize infrastructure investment
- Highest ever Capital outlay of 22.4 lakh crore for Railways
- 100 transport infrastructure projects identified for end-to-end connectivity for ports, coal, steel, and fertilizer sectors
- Creating Urban Infrastructure in Tier 2 and 3 cities via the establishment of UIDF
Unleashing the Potential-Trust-Based Governance in Budget 2023
- Make AI in India
- National Data Governance
- Vivad se Vishwas I – Less stringent contract execution for MSMEs
- Vivad se Vishwas II – Easier and standardized settlement scheme
- Phase 3 of E-Courts to be launched (Effective administration of Justice)
- Entity Digi Locker to be set up for use by business enterprises and charitable trusts
- Setting up 100 labs for 5G services-based application development
- R&D grant for Lab Grown Diamonds (LGD) section
Green Growth in Budget 2023
The government is focusing more on green growth and they are announced various schemes. and they are going to demolish vehicles more than 15 years old. the major points that cover green growth are given below
- PM-PRANAM to be launched
- 500 new ‘Waste to Wealth’ plants be established under GOBARdhan
- Stainable Ecosystem development
- Setting up 10,000 bio-inputs resource centers to facilitate farmers to adopt natural farming
- Battery energy storage systems Promotion
- Coastal shipping for energy-efficient transportation Promotion
- Funds to be allocated for replacing old polluting vehicles
Amrit Peedhi -Youth Power in Budget 2023
This is the area that government plans for the youth. Announced various schemes to support the young generation in India
- PMKVY 4.0 (Covering new courses like coding, AI, Robotics, 3D printing, etc.)
- Measures to boost the Tourism sector
- States will be encouraged to set up Unity Malls
Financial Sector in Budget 2023
The government is announced various for the finance sector few of which are given below
- Setting up of National Financial Information registry
- Setting up a Central Data processing Centre
- Credit Guarantee scheme for MSMEs
- Mahila Samman Bachat Patra ( One-time new small savings scheme for a 2-year period with a deposit facility of up to 32 lakh for women)
- Benefits for Senior Citizens (Enhanced maximum deposit limit for senior citizens savings scheme from 315 lahk to 330 lahk)
- Initiatives to promote business activities in GIFT IFSC
- Create more trained professionals in Securities Markets via the award of educational certificates
Fiscal Management
The government is focusing on reducing the fiscal management by 2025 to 2026 they are expecting to reach below 4.5%. A few of the keynotes for fiscal management are given below
- 50-year Interest-Free Loans to States
- To be spent on Capital Expenditure within 2023-24
- Part of the loan is conditional on States increasing actual Capital expenditure and parts of the outlay will be linked to States undertaking several reforms
- A fiscal Deficit of 3.5% of GDP allowed for States (0.5% tied to Power sector reforms)
- Fiscal Consolidation (Targeted Fiscal Deficit to be below 4.5% by 2025-26)
The major allocations in various sectors are given below
How the Impact of Budget 2023 on the stock market and economy
The major updates happened in the area of personal tax calculation. The Ministry of finance in India already brought a new regime of tax calculation in the year 2020. right now they made huge changes in the slabs and it reduced to 5 slabs
The major changes are, in the new regime previously up to 5 Lakh you don’t need to pay any tax. In the updated new regime it’s increased to 7 Lakh. That means if your annual income fall under 7 Lakh you don’t need to pay any income tax.
In this budget income tax has been rationalized to a certain extent, which leads to an increase in the revenue of the government going forward. This is the benefit for the taxpayer whose salary is less than 7 Lakh. If they don’t need to pay taxes, means they have more money in their hands.
The purchasing power of a person will increase. Mostly this will help the middle-class family, they are the beneficiaries of the new regime updates. When people have money they will start saving that money and investing in different areas. the stock market has one of the advantages of this. a certain percentage of people will come into the stock market for medium or long-term investments.
In this budget 2023, the government is focusing on 7 areas and they called it “Saptarishi – 7 priorities”. These are the major areas the government is focused on. these are considered the pillars for the growth of the Indian economy. This budget says that the Indian economy is set to grow at 7 %. During the pandemic times growth rate of the Indian economy fell drastically, From that situation economy is recovering, and rising to 7 % means the Indian economy is in a fast recovery mode.
In this budget 2023, the government is focusing on capital expenditure. India is a consumption-led economy and an increase in capital expenditure helps the economy to produce more because people have more money. The government is planning to do a 33.4% increase in capital expenditure compared to last year.
The Fiscal management is good in this budget and the government is targeting to make the fiscal deficit less than 5.9%.
This budget gives more importance to domestic consumption. consumption of a country increases the overall prosperity of the nation will increase
When the rate of increase of debt will be lower it leads to bonds market yields are going to fall. If bond market yields fall the equity market will go up. This will be a positive sign for the stock market.
Conclusion of the budget 2023
- Tax rates are reduced and that will help the middle-class family
- Fiscal deficits are reducing and the targeted rate is 5.9%
- Focusing more on domestic consumption and improving manufacturing within the country
- This budget will help the banking stocks and they are going to do well
- Do more focus on macro investing