New Delhi, Jan 25: Union Finance Minister Arun Jaitley will present the Union Budget 2017 in the Parliament on February 1. The Budget 2017 will be Prime Minister Narendra Modi led government’s third full-fledged budget. Ahead of the Budget 2017, industry experts of Infrastructure, Energy, Transportation, Banking and other sectors are speaking about their expectations from Modi government’s Budget. The economy is hit by the demonetisation drive of the PM Modi. The Budget 2017 assumes more significance as this is the first major economic announcement by the Modi government post note ban.
All eyes will be on Arun Jaitley as the Finance Minister will present the Budget 2017 in the backdrop of adverse impact of demonetisation on the economy, impact of GST on revenue and Assembly elections in Uttar Pradesh, Punjab, Uttarakhand, Goa and Manipur. In a bid to boost GDP growth, the government will emphasise improved resource allocation and better distribution of expenditure in the Budget 2017. Below are sector-wise expectations from the Budget 2017:
In the previous Budget, the government had allocated nearly Rs 2.2 lakh crore for the infrastructure sector. The government is expected to continue its focus on the road sector and railways. There could be 30 per cent increase in budgetary allocation to the Roads and Highways Ministry. The government has also planned a total outlay of nearly Rs 40,000 crore for the National Investment and Infrastructure Fund which will play key role in the infrastructure development. There would be an increase of 10 per cent in the budgetary allocation for schemes focused on rural housing, roads and bridges.
In the Budget 2017, the government will continue to encourage the use of renewable energy by extending various tax incentives. Demand like treatment of solar parks at par with SEZs with MAT exemption provided to projects within these solar parks has also been raised by industry players. The government may also cut the excise duty of fuel rates. The government is also expected to provide exemption on transportation of LNG from a foreign country.
The government had allotted Rs 97,000 crore for road sector in the previous budget, out of which Rs 55,000 crore was for the national highways and remaining for the development of rural roads. Despite such high budgetary allocation, Ministry of Road Transport and Highways (MoRTH) and National Highways Authority of India (NHAI) have missed their targets this year. The government is likely to increase the budgetary allocation for the road sector to complete the pending projects. A railways employees union demanded that the Income Tax exemption limit be raised to Rs 6 lakh in the Union budget and also exemption of transport allowance from the purview of I-T.
The banking sector is going through a tough times as the large scale defaults have weakened the balance sheet of banks. Considering government’s initiatives to promote digital transactions, the wish list of the industry players includes tax concessions for customers and merchants using digital modes of payment in the upcoming Budget. They also expect more funds to infrastructure, housing and urban development that will ease the stress level of corporate sector. The bankers have also pushed for a 100 per cent deduction on bad debt provisioning.
The real estate sector wants government to increase the tax deduction limit for housing loans, especially for buyers in metropolitan cities and 10 per cent increase in allocation to the implementation of ‘Housing for All’, 2022 scheme.
The demonetisation drive and cash crunch has hit hard the auto sector. The he industry witnessed fall in sales in November and December across the segments. The automobile industry expects the government to slash personal income tax rates so that consumers can spend on their auto demand. Reduction in excise duty on SUVs is also in the wish list of the auto sector.
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