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Union Budget
7 reasons why Union Budget 2018 is a masterstroke by PM Modi!
The Union Budget 2018 presented by the Finance Minister Arun Jaitley was the last budget of the Narendra Modi government before the country again goes to Lok Sabha elections in 2019.

It is said that this budget has been able to satisfy the needs of each and every section of the society. As was expected, opposition political parties, however, do not endorse this general view and are criticising the budget on the pretext that the middle class taxpayers have been completely ignored in the budget. 

Before, we proceed further let us first discuss the benefits given in the budget to the middle class population of the country. 

1. Majority people in the middle class can be classified as salaried persons. Standard deduction of Rs 40,000 has been introduced in the budget, which will be available to all persons drawing salary and pension, irrespective of their salary amount. It may also be noted that there are no conditions attached for availing this deduction. Some people are spreading misinformation that the benefit of standard deduction has been taken away by the government by withdrawing the transport allowance of Rs 19,200 and medical reimbursement of Rs 15,000. It may be noted in this regard that the availability of these two benefits was not unconditional. Any allowance under the Income Tax Act was allowed subject to the amount actually spent by the assessee. Medical reimbursement was also available on the submission of the medical bills. Further, the transport allowance was not available to those who were getting pension and those who have been provided transport facility by the employer. There are no such conditions attached for availing the standard deduction. Clearly any allowance and reimbursement cannot be compared with the standard deduction. 

2. Long term capital gain on sale of equity shares route was misused by the large corporates and manipulators to earn and accumulate tax free income at the cost of the general public. Government has rightly checked this malpractice by bringing this income into the tax net so that the revenue generated by this step can be used for the general welfare and development of the other sections of the society. To protect the interests of the middle class population, here again, an exemption of Rs 1,00,000 has been provided, which means that any long term capital gain on sale of equity shares up to an amount of Rs 1,00,000 shall not be taxable. 

3. Another major category in the middle class population can be classified as senior citizens. Existing tax free interest income limit of Rs 10,000 has been enhanced to Rs 50,000 for senior citizens. Amount admissible for health insurance premium and medical treatment has been enhanced from Rs 30,000 to Rs 50,000. The existing limit of Rs 60,000 to meet out the medical treatment of certain specified critical diseases has been enhanced up to Rs 1,00,000. 

4. Budget has given major incentives to certain industries for employment generation. In all probability, middle class is going to be benefited by this step. Those who are going to be employed in the industry are likely to come from the middle class families only. 

5. For senior citizens investment limit under the PMVV Yojna has been enhanced from Rs 7,50,000 to Rs 15,00,000. 

The above list of benefits to middle class is not exhaustive and the other measures taken by the government in the Budget are also likely to benefit the middle class in a big way. Some of the examples of such measures are the incentives and tax relief to MSME sector, setting up of 5 lakh Wi-Fi hot spots in rural areas, allocation of Rs 3 lakh crore for PM Mudra Yojna, promotion of start- ups etc. 

It is therefore clear that the allegations of the opposition parties and their leaders that there is nothing in this budget for the middle class, is without any basis. 

Now, let us discuss the measures taken in the budget which not only provides measure of relief to almost each and every section of the society, but will also contribute to the long term growth and development of the nation. Congress party has given the slogan of "garibi hatao" in 1971 and this remained a political slogan as nothing was done by any government to ensure that the poverty is actually eradicated from the society. Year after year, several schemes were announced in the budgets in the name of "garibi hatao" but there was no mechanism to ensure that the benefits intended to reach the poor people are actually reaching them or not. After Modi government came to power in 2014, it launched a massive operation to open the Jan Dhan bank accounts so that the benefits which are due to the poor people are directly transferred to their bank accounts. Linking of Aadhaar with the bank accounts further eliminated any possibility of monetary benefits going into the wrong hands. 

We list down the 7 major steps taken by the government in the Budget-2018, which can be termed as masterstrokes:

1. Boost to agricultural economy 

For the first time after the independence, something meaningful is being done to boost the agricultural economy. MSP for all crops proposed to be raised to one and half times of their production cost. 22,000 rural haats will also be developed to protect the interests of the small and marginal farmers. Institutional farm credit has also been raised to Rs 11 lakh crore. Operation Greens will address the price fluctuations of potato, tomato and onion. Two new funds of Rs 10,000 crore have been announced for fisheries and animal husbandry sectors. National Bamboo Mission has also been allocated Rs 1,290 Crore. 

2. Women empowerment 

In order to ensure that the women empowerment does not remain only on paper, some concrete measures have been proposed. Government will contribute 8 per cent in EPF Accounts for 3 years for women employees. Under the Ujjwala Scheme, target of free gas connection to women living below the poverty line has been enhanced from 5 crore to 8 crore. Loans for women self help groups will be increased to Rs 75,000 crore by March 2019. Allocation for National Rural Livelihood Mission enhanced to Rs 5,750 crore. Maternity leave period increased from 12 weeks to 26 weeks. Two crore toilets proposed under the Swachch Bharat Abhiyan. 

3. Health for all 

World's largest health care scheme covering 10 crore poor and vulnerable families consisting of around 50 crore people has been announced. This will provide the Floating Mediclaim Cover of Rs.500000 to each household. Rs.1200 Crore have been allocated for Health Wellness Centres and Rs.600 crore have been allocated for providing nutritional support to TB patients. One Medical College is proposed for every 3 parliamentary constituencies. 24 Government District Hospitals shall be upgraded to Government Medical Colleges. 

4. Education 

To improve the quality of education in the country, integrated B.Ed programs have been proposed. Under the PMRF scheme, 1000 students pursuing B.Tech per year will be provided facilities to do PHD in IITs and IISc with handsome fellowships. RISE scheme has been allocated Rs 100,000 crore over 4 years for revitalising the school infrastructure. Every block having 50 per cent ST population and at least 50,000 tribal people shall have "Eklavya School" by 2022. 

5. Infrastructure development 

Almost 6 lakh crore have been allocated for infrastructure development. One crore houses have been targeted in rural areas. Completion of PM Gram Sadak Yojna advanced to 2019.To eliminate the capacity constraints and transform almost all the network into broad gauge, capex for Railways have been enhanced to Rs 1,48,528 crore. Airport capacity is also proposed to be expanded up to 5 times. 

6. New opportunities 

Target of lending increased to Rs 3 lakh crore under MUDRA scheme. Government will contribute 12 per cent of the wages of the new employees in the EPF for all sectors for the next 3 years. 50 lakh youth will be given stipend support under the under the National Apprenticeship Scheme. Tax rate for MSMEs having turnover up to Rs 250 crore has been reduced to 25 per cent. Measures have been proposed to address the NPAs and stressed accounts of MSME sector. 

7. Middle class

Middle Class population is the backbone of the society and its role in the development and growth of the nation is paramount. No government can ignore the middle class and it is least expected from the Modi government which is committed for – "sabka saath-sabka vikas". Measures taken by the government for the benefit of middle class have already been discussed in detail and need no further elaboration. It may also be noted that the measures proposed for all other sections of the society are of such nature, which will ensure the overall growth and development of the nation and will benefit all sections of the society. 

Budget making exercise is a tough task and it becomes more difficult when it is the last budget before going into the general elections. Governments are often tempted to give "populist" budgets in such situations. PM Modi too had the option of giving a "populist" Budget. But we have seen how after the independence, successive governments announced several schemes which were never implemented. We have also seen at the time of demonetisation and at the time of implementation of GST, present government always implemented the schemes which are necessary for the development of the nation and welfare of the society, without any fear or hesitation about the vote bank politics and despite opposition from the political parties and their supporters sitting in the main stream media and elsewhere. People have also posed their faith in the government and its initiatives, which is evident from the election results of the several states after the Demonetisation and GST implementation. Despite the fact that Opposition parties and their leaders have made every possible effort to mislead the people of the country on demonetisation and GST, people of the country virtually snubbed these so called opposition parties and their leaders. If we look at the proposals announced in the Union Budget 2018-19, we can only say that this is a masterstroke by the Modi government, which has totally silenced the opposition parties and also provides the benefits to each and every section of the society with only single concept of "sabka saath-sabka vikas" in mind. 

Editorial NOTE: This article is categorized under Opinion Section. The views expressed in this article are solely those of the author and do not necessarily represent the views of In case you have a opposing view, please click here to share the same in the comments section.
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