The Budget 2024 will stimulate the economy and bolster GDP growth in the long run, says RK Jha, CEO, LIC Mutual Fund. The budget has proposed various schemes to generate employment opportunities, promote internship programmers, and incentivise employers who create every additional job. In the Budget 2024, Modi 3.0 has decided to maintain infrastructure spending at ₹11.1 lakh crore, aligning with the interim budget figures, which represents 3.4% of GDP. Additionally, there's a significant allocation of ₹1.5 lakh crore for interest-free loans to states, aimed at boosting their infrastructure investments, he says. “The budget highlights positive impacts such as enhanced road connectivity in the Eastern region and increased focus on infrastructure development, which could drive demand for commercial vehicles,” says LIC MF’s CEO. “The commitment to build an additional 3 crore houses under Pradhan Mantri Avas Yojna (PMAY) is seen as favourable for the cement sector, while continued support for PM Avas Yojna is expected to bolster affordable housing initiatives,” he adds. He said that initiatives like supporting women-led units and a credit guarantee scheme for MSMEs are aimed at stimulating demand for microfinance loans and supporting credit availability and asset quality for lenders. “The FM has introduced a series of reforms at the taxation front, especially in the capital gains taxes, GST, Securities Transaction Tax, TDS, and personal income tax. The abolition of Angel Tax is the most prominent announcement in the Budget that will bring cheers to the domestic startup community,” he says. In the budget announcement today, there has been a marginal increase in the capital gains tax both on short-term and long-term basis. The same may have a negligible impact, however in the long run the capital markets may continue to flourish, he adds. According to him, personal income tax slabs in the new scheme are simplified and reduced in such a way that it will benefit crores of employees and pensioners. Obviously, the thrust is on promoting the new tax regime under which the standard deduction limit has increased. Also, under NPS the limit of employer’s contribution has been raised from 10% to 14%.
