Unfolding Budget 2022๐Ÿ“ˆ

Unfolding Budget 2022๐Ÿ“ˆ

Itโ€™s been impossible to dodge budget-chatter on social! In all, GOI laid out a progressive agenda โ€” fiscally conservative as expected, working to seed organic growth vs. one-time handouts, and prioritizing tech adoption.

Quick look at some key highlights that stood out to us: ๐Ÿง

  • On infra spending: Capital expenditures expanded by 35%+, to โ‚น7.5 lakh crores โ€” this is basically money spent on bridges, and roads, and rail, and other mega infrastructure projects which catalyzes economic activity downstream. States will also receive up to โ‚น1 lakh crores for their capex needs.
  • On banking: Major banks will be asked to set up and tune dedicated digital operations in 75+ districts โ€” seeding wider adoption at the rural level. Meanwhile, Indiaโ€™s Postal service is diving into financial services โ€” all 1.5 lakh post-offices will be linked with banks to enable online fund transfer and other services at the PO center.
  • For mass upskilling: GOI will be kicking off a new portal for comprehensive digital upskilling โ€” called DESH stack.
  • For telecom: 5G spectrum actions will be done in 2022. Critical for India to make sure it sustains all the digital bandwidth explosion.
  • On boosting production: host of concessions were outlined on imports โ€” including on certain electronic parts & items to make sure companies kicking off India manufacturing under major PLI schemes donโ€™t feel the pinch
  • On taxation: most sweeping change brought was to tax all crypto and other digital-asset earnings at a 30% flat rate. Bit expensive? Sure. For now, grateful we didnโ€™t hear the word โ€˜banโ€™ anywhere!
  • Thereโ€™s more blockchain: RBI will be launching a blockchain-backed Digital Rupee next year. Hard to imagine what role Blockchain plays here, but weโ€™d give regulators a chance considering the exemplary success of infra projects like UPI.
  • On startups: Tax benefits extended to growth ventures. Earlier announced redemption of taxes for 3 consecutive years will now be extended for another year.
  • On clean transportation: 400 new energy efficient trains to be launched over the next 3 years.

Thereโ€™s a host of other moves announced โ€” from PLI schemes to accelerate production of solar modules, to the launch of e-passports, and a national tele-health service focusing on mental health to deal with post-COVID blowback. Hereโ€™s a pretty neat summary from the kind folks at ET!

Bottomline โ€” its moot to debate the effectiveness of the moves. Weโ€™d defer to the markets to judge โ€” and the Sensex finishing up 1.5% for the day seems like a decent verdict of approval.