A promise to turn India into a $10-trillion economic powerhouse in eight years

Finance Minister Piyush Goyal prefers to call it interim budget. It’s beyond the usual vote on account and annual financial statement presented in an election year like this. Goyal’s maiden show within Lok Sabha and outside was impressive.

His chaste Hindi and English rendition of budget speech bringing in informality to narrating even the most serious issues like farmers’ distress was refreshing.

Goyal’s family sat through in the Lok Sabha visitors’ gallery to witness singularly the most important moment in his life. Prime Minister Narendra Modi also could not help but to break into a broad smile, walk up to Goyal and pat his newest stand-in finance minister.

Home Minister Rajnath Singh followed suit with a big grin. Goyal, on his part, bent down to touch the feet of senior BJP leader L K Advani who readily gave his blessings.

The last budget of this government gave an insight into BJP’s thrust if re-elected for a second term. The eight point ‘vision statement’ promises to turn India into a $10 trillion economic powerhouse in eight years.

The grandiose vision may be intended at enlisting support of international community, foreign investors apart from selling progressive face of the party to voters back home. This may well serve as a vital input into BJP manifesto and the party’s election campaign machine.

Contrary to popular notion, BJP government’s budget may not be populist though intended at pandering to its core constituency of voters that is now broad based and extends hugely to rural India.

Otherwise, how does one explain Piyush Goyal sticking to path of fiscal prudence and at the same time finding Rs 75,000 crore as assistance to small and marginal farmers with less than two hectares landholding? The Rs 6,000 annual support will benefit over 20 crore farmers’ families in all.

This support through “PM Kisan Nidhi” is superior to the universal basic income or minimum income support schemes floated from within and opposition. Most importantly, it’s workable with the available resources. Government’s push in fisheries and ‘Kamadhenu’ project to develop dairy industry apart from commitment to expand rural industrialisation is wholesome.

Modi, Arun Jaitley and Goyal, troika behind the budget seem to have stuck to path of fiscal consolidation while thanking the middle class taxpayers that are also main stray of the BJP vote bank.

Huge tax incentives and concessions provided through higher exemption limits, standard deduction, concessions’ to buy a second house have revenue implication worth a whopping Rs 20,000 crore next financial year.

What stand out in a big way are the concessions offered to individual homebuyers that would spur the real estate sector big time. That’s the only plausible explanation to providing capital gains rollover on buying two houses as once in a life opportunity.

Extension of tax holiday for unsold real estate domestic units to two years and tax exemption on rental income up to Rs 240,000 per individual is a big announcement.

Providing monthly pension of Rs 3,000 for both organised and unorganised sector workers with 50% contribution by the government again is sign of a maturing welfare state that practices free economy.

Thankfully, Piyush Goyal did not attempt taxes recast for corporate sector that would have turned the interim budget into a regular one. Already, the opposition parties have upped the ante citing possible constitutional violations made by Goyal while offering income tax concessions to the middle class. In all, the interim budget is for the quintessential ‘aam aadmi’.