Transparency, tax stability key principles of Budget 2021: Sitharaman
By TIOL News Service
NEW DELHI, FEB 06, 2021: FINANCE Minister Ms Nirmala Sitharaman said on Friday that though the budget provides for enhanced capital expenditure by the government in 2021-22, it also seeks private sector participation for growth recovery.
Addressing industry leaders during a virtual interaction with the Confederation of Indian Industry (CII), Ms Sitharaman explained that though the Centre will provide some capital for the proposed Development Finance Institution (DFI), the DFI will also raise capital from the market. Additionally, the DFI Bill will provide legislative space for private DFIs.
Similarly, the Asset Reconstruction Company (ARC) for the management of non-performing assets (NPAs) will be floated as a holding company by the banks themselves, with support from the government.
The capital expenditure by the government in the current fiscal year is estimated to be Rs. 4.39 trillion and it is further projected to rise 25.3 per cent to Rs. 5.5 trillion in the upcoming year.
"Sharing the key guiding principles for the budget, the Finance Minister emphasised the focus on transparency. Contrary to the expectations of a COVID-19 tax, the government has chosen to fund the budget stimulus through higher borrowing, rather than increased taxes," she said.
Ms Sitharaman explained that the government's thrust is on areas with high multipliers such as infrastructure which would facilitate the private sector, such as power, roads, ports and airports. Healthcare and agriculture are among other priorities.
The Finance Minister promised an "honest, leakage-free implementation" of the budget proposals.
Sharing the industry response to the budget, CII President Mr Uday Kotak said it was an "example of an outstanding policy document which addresses the needs of the economy. He appreciated the boldness of the announcements, and the focus on growth and transparency."