Finance Minister Nirmala Sitharaman will have a tough task ahead of her as she rises to present the Union budget for 2023-24 on February 1. Geopolitical uncertainties thrown up by the Ukraine war threaten to push one-third of the globe into recession, which will have a bearing on India’s exports. COVID-19 still lurks in the background, and could force the Indian authorities to step up vigilance should it reappear. Meanwhile, a widening trade deficit, weakening exports and unemployment remain big sources of worry, even as core inflation remains stubbornly high. Boosting consumption, especially in rural areas devastated by climate catastrophes, as well as private investment continues to be a challenge. The Board of India Today Experts (BITE)—Ajit Ranade, Vice-chancellor, Gokhale Institute of Politics and Economics, Pune; Niranjan Hiranandani, Co-founder and MD, Hiranandani Group; D.K. Joshi, Chief Economist, Crisil; Vivek Kumar, Economist, QuantEco Research; Sunil Badala, Partner and National Head, BFSI Tax, KPMG; and Madan Sabnavis, Chief Economist, Bank of Baroda—met at The St. Regis Mumbai on January 14 to deliberate on the key issues before the country and how the FM could address them in the Budget. Edited excerpts:
Q. Which are the key areas that the FM should address in the 2023-24 Budget and why?
● NIRANJAN HIRANANDANI: The maximum marginal rate of tax for an individual who does very well is 42 per cent, as against 15 and 25 per cent for corporate entities, and 35 per cent for partnerships. That means a person who is actually an entrepreneur has to create companies and partnerships to save tax. This needs a correction. The other thrust should be on investment in the economy. It has to be doubled. We need to get into double-digit GDP growth in the next three years. To achieve that, investment has to come from the government and the private sector. Yes, they’re doing it; they need to do more.
● Pause the populism. We’re just coming out of COVID. We have come out of the huge extension of the free food
