Budget 2023-24 (3) (1).pptx will explain about key development in india

Budget 2023-24

1. BUDGET: 2024-25 Mittal School of Business 9 th February Prof S N Misra, IES, PhD Emeritus Professor

2. ADS of a Budget: Musgrave Allocational Priority between Social, Economic & General Sector Distributive Justice: Degree of Progressivity of Direct Taxes Economic Stabilization: Unemployment, Inflation, Fiscal Deficit

3. Macro Economic Indicators Parameter 2007-08 2019-20 2020-21 2021-22 2022-23 2023-24 GDP 8.7 4.2 -7.7 9.3 7.5 7 Investment 35.9 28.5 27.3 28.9 2 9.2 29.3 CPI 5 .5 4.8 6.6 6 6.8 5.4 CAB/GDP -0.9 +3.1 -0.7 -1.3 1 FER ($B) 475.6 586.1 633.6 6 15 620.4 M 3 ( ) 2 2.4 10.1 12.4 9.9 8.8 11.6 Credit ( ) 6.1 6.1 6 4.6 FD/GDP 3 .3 4.6 9.2 6.9 6.4 5.8 RD/GDP 1 .5 3.3 7.5 5.1 4.8 2.9 Source: Economic Surveys

4. Global Macroeconomic Trends Country GDP CPI Unemployment CAB Budget Balance Government T Bond Rate (10 Year) USA 3.4 4.9 3.9 -3.5 -7.7 1.8 China 5.3 2.3 5.1 +2.3 -4.7 2.4 Japan 3.2 1.3 2.7 + 3.1 -7 - Euro Area 3.9 3 7 +3.2 -4. .1 Germany 3.3 3.5 3.2 +6.5 -2.7 -.1 Russia 2.4 4.9 4.3 +6.3 .2 8.8 India 7 4.6 6.6 -1.6 -5.9 6.9 Source: The Economist

5. Nirmala’s Budget GDP growth globally High Allocation: Myriad Inclusive Programs Focus on Infra Spending Continuing ( Roads, Railways) Distributive Justice: Income Inequality Increasing Economic Stability: FD Decreasing, Inflation within Glide Path, Unemployment An Area of Concern Cost of Capital High

6. Significant Achievements Capex up from 12% of CGE (2013) to 22% (2023) Gross NPA down from 11.2% (2018) to 5.8% in 2023: IBC Free gas to 10.11 cr women (Ujjala Yojna) 11.72 cr Toilets ( Swach Bharat) 10.8 cr households tap water (Jal Jeevan Mission ) 51.6 Cr Jan Dhan Accounts, 2.6 cr pucca houses 6.27Cr hospital admission under Ayushman Bharat 1.3 Cr received training under PMKVY & 2.4 million placed 26.1 lakh cr disbursed under MUDRA (68% women) Female Labour Force Participation up from 23.3% (2018) to 37%

7. Capex’s share in total expenditure

8. Declining gross Non-Performing Assets of SCBs (as % of Gross Advances)

9. Female Labour Force Participation Rate (rural + Urban), usual status, 15 years and above

10. Interim Budget: 2024-25: At A Glance Parameter 2023-24 (BE)(Rs L Cr) 2023-24 (RE) 2024-25(BE) Revenue Receipts 26.32 26.99 30.01 (11% In ) Borrowing 17.86 17.34 16.85 Revenue Expenditure 45 44.9 47.65 Capital expenditure 10 9.5 11.1 Revenue Deficit as % GDP 2.9 2.8 2 Fiscal Deficit as % GDP 5.9 5.8 5.1

11. Areas of Concern Manufacturing 16% of GDP to 25% Private Sector Investment (29%) to23% Under Allocation to the Social Sector Multi Dimensional Poverty Interstate Development Difference Growth Employment Mismatch Rising Income Inequality

12. Stagnant Share of Manufacturing G GDP = f(g m ), f > 1: Nicholas Kaldor Positive correlation between the growth of manufacturing output and growth of productivity G= S/C, where S= Savings & C is Incremental Capital Output Ratio: Roy Harrod NIMZ Policy & Production Linked Incentive Value addition in mobile phones< Subsidy : Rajan Skill: 5% in India vs 24% in China, 75% (G), 96% (Korea): Manufacturing Hubs

13. Trends in Investment Rate over the years

14. Contribution of Factor Productivity: China Vs India Factors China (1979-94) India (2022) Capital 46% 53% Labour 13% 17% Total Factor Productivity 41% 30%

15. Low Allocation: Social Sector Sector 22-23 2023-24(BE) 2023-24(RE) 2024-25(BE) SSA 32514 37453 32999 37499 UGC 5091 5360 6409 2500 Health 40639 47347 42181 49037 Skill development 1119 2278 2333 2685 Women & Child Development 23746 25190 25151 25848 National Health Mission 33802 36875 33885 38183 Poshan 12082 14129 14652 15047

16. Learning Outcomes: ASER 2022

17. Learning outcomes of Standard 5: West Bengal and Karnataka

18. ALLOCATION TO EDUCATION AND HEALTH: GLOBAL TRENDS Country HDI Public Expenditure as % of GDP (Health) Public Expenditure as % of GDP (Education) Total USA 0.920 8.3 5.2 13.5% Germany 0.926 8.7 4.9 13.6% Japan 0.903 8.6 3.8 12.4% Russia 0.804 3.7 4.2 7.9% China 0.738 3.1 4 7.1% Brazil 0.754 3.8 5.9 9.7% India 0.624 1.4 3.8 5.2% Source: Human Development Report (2023)

19. Multi-Dimensional Poverty: SDG Parameter % of Deprivation Nutrition 21.2 Child Mortality 28.3 Education 23.4 Cooking Fuel 26.2 Sanitation 24.6 Drinking Water 6.2 Electricity 8.6 Housing 23.6

20. THE NUTRITIONAL STATUS OF ADOLESCENT GIRLS, RSOC, 2013-14

21. INTERSTATE COMPARISON: SDG

22. Balanced Growth Between States: Desai High income states are in South, West & Lower ones in North, Centre & East: Ratio 2.5, manufacturing : 3.6, Services 2.9 Raised Investment in Infrastructure in low income states Visible difference: Entrepreneurship , Factories (75%) Access to engineering colleges (70% of seats) Promote entrepreneurship & Skill in Low income States Value chains linking enterprises in South& West & Eastern States Skill development & engineering education

23. Growth Employment Mismatch

24. Constitutional Mandate Promote Socio-Economic Justice Distribute resources to serve the common good: Article 39 (1)(b) Minimization of Income Inequality: Art38(2) Early Childhood Care & Education: Art 45 Raise the level of Nutrition & Level of Sanitation: Art 47

25. Participatory Socialism Early intervention in primary education best way to correct scholastic inequality between students from different social backgrounds Steeply progressive taxation on Property, IT to pay for social insurance & Security Social, fiscal & and political institutions can help to create a just society and security

26. Way Forward Big Push for Education, Health, Nutrition, Sanitation & Skill: Long-term Human Development Technology: We have stumbled into the 21 st Century with Stone Age emotion, medieval institutions & and Godlike Technology: Wilson, Industry 4.0, AI Make in India Not to encourage domestic industries to survive behind a high tariff wall Our greatest illusion is that we can build a healthy society around mindless pursuit of Wealth: Sachs Reality Check on Rhetoric and Reality

27. Financials of Railways Parameter 2021-22 2022-23(RE) 2023-24 (BE) Revenue Receipts( Rs Lakh Cr) 1.92 2.42 2.65 Revenue Expenditure 2.0 2.42 2.62 Operating Ratio 107.39 98.22 98.45 Passenger Fare Loss 37937 55020 72169 Capital Expenditure 1.9 2.45 2.6 % Budgetary Support 60 70 90

28. Reforms in Railways Niti Ayog (2019) : Cross subsidization of passenger fares higher freight tariffs Public-private partnerships, the share of freight by rail of only 20%, though less costly Social service obligation of railways to be revisited (Parliamentary Committee) Debroy Committee (2015): Private Sector Participation, Independent Regulator External Financing to increase Outsourcing of Non-Core activities