The recent Union budget 2017 with its key highlights and loopholes is certainly favorable / unfavorable for different sections of the society. E.g. the government plans to spend more in rural areas, on infrastructure and towards poverty alleviation will boost the rural economy and bolster its economic upliftment. However, while the budget has some commendable highlights such as reduction in the tax rates for individual tax payers, boost to the digital economy by prohibiting the cash transactions above Rs3 lakh, plans to build 1 crore households by 2019, allocation of huge sums of money towards infrastructure, it also has certain loopholes.
As per a recent article published by Firstpost, nearly 41% of India’s population is below the age of 20. The average age in India will be 29 by 2020 and it is set to become the world’s youngest country with 64% of its population in the working age group,
There were certain areas wherein the union budget policies could have been more beneficial, especially for the young population of the country –
Tax structure
The reduction in the income tax from 10% to 5% in the first slab (2.5 lakh to 5 lakh) is a good move. However, imposing 20% tax on incomes between 5 to 10 lakhs and 30% tax on the incomes above 10 lakhs has made the entire structure distorted. The agenda is to encourage people to declare their income in a transparent manner and pay their taxes on time, but this kind of tax structure would lead to more people not declaring their actual income and continuous harassment of honest tax payers. This is not an encouraging move for the young tax payers who fall in the high income bracket.
Incentives to Start-ups
India is witnessing many young entrepreneurs leaving their highly paid jobs, in the pursuit of following their dreams and it is resulting into a complete revolution, especially in the service industry. Companies like PayTm, Mobiwik etc. have taken the service industry to a next level. In order to promote the Start-ups, the government should have introduced certain incentives such as ease of credit – Low interest rates on loans and longer payback period. This would encourage more people to go ahead and implement their unique business ideas which would eventually lead to more job creation and largely boost the service and manufacturing industries.
Education
As per an article that was recently published in Indian Express on the Budget 2017-2018, the condition of education in some states such as Uttar Pradesh and Bihar is quite poor. Moreover, Government Universities cannot accommodate all the students which lead to more students enrolling themselves in private Universities where the fee is too high and everyone is not economically capable of studying in a private educational institution. Therefore, government should lower educational loans for graduate and post graduate courses. More investment should have been announced in the education infrastructure to create world class infrastructure that would encourage industrial engagement with such institutions.
Employment generation
The recent budget predicts that job market will grow as a result of investment in the manufacturing, infrastructure and focus on digit payment industry. However, the urgency of creating more jobs has not been highlighted, even though there is huge youth population in the country. While the corporate tax was cut down to 25% for small and medium companies, it remained at 30% for large corporations. No incentive for large players would discourage the big private corporations to enter the Indian market.
No significant investment was announced in the development of education infrastructure and new skill development courses that would have further created more eligible people ready to take up jobs that require new and unique skills.
Though the finance minister announced the increase in allocations for Deendayal Antyodaya Yojana for promotion of skill development for people in rural areas but any such scheme that would have directly benefited the urban population was not announced.
Two in three Indians are below the age of 35 and about a million people seek employment every month. To address such huge demand for jobs, some more measures should have been introduced that would have directly addressed the issue of employment generation.
I would like to conclude that there are definitely certain areas where the budget has its loopholes when it comes to addressing the problems of the youth, which is the future of our country. Anything that would benefit youth would indirectly benefit nation as a whole.
