India is currently the 6th largest economy of the world. During recent years there has been a reduction in average inflation and fiscal deficit which boosts of an economy getting stronger. This is the result of strong measures by the government to the divide between urban and rural areas and improving the overall financial health of the country. There have been significant infrastructure improvements, implementation of new financial policies and efforts for job creation.
The Interim Budget presented for the financial year 2019-2020 by current Minister of Finance Piyush Goyal, provides even better measures of relief from inflation to the farmers, low income and middle-income people. The government has announced Rs. 60, 000 crores allocation to Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) and 1 lakh digital villages have been proposed. For farmers owning land below 2 hectares, Rs. 6000 cash per year has been proposed under Pradhan Mantri Kisan Samman Nidhi. Along with this, the Minimum Support Price (MSP) for 22 crops will be increased to 1.5 time the production cost which will being additional earnings for the farmers.
For low income groups like workers and laborers, the minimum pension proposed in the interim budget will be increased to Rs.1000 per person. Under the Pradhan Mantri Shram Yogi Bandhan, workers in unorganized sectors will be eligible for a pension of Rs.3000 per month, after the age of 60, provided that a minimum of Rs.100 is contributed every month from their salary till retirement. Close to 10 crore workers are expected to be benefitted from this scheme.
For the working-class people, good news comes in the form of no taxation for salaries up to 5 lakhs. People with a gross income of up to 6.5lakh will also be exempt from paying taxes if necessary, investments are made. It is estimated that 3 crore taxpayers will be benefited from these new exemptions. Standard deduction from income will see an increase of Rs.10000 and will now be Rs.50000 per annum. Apart from these measures, limit of TDS on interest from post office and banks will be raised to Rs.40000 and TDS threshold on rent will increase from 1.8lakh to 2.4lakhs. The gratuity limit has also been increased from 10 lakhs to 30 lakhs. The income tax processing of returns will now be completed in 24 hours and within two years all verification of income tax will be done electronically.
The government has also proposed that the fiscal deficit is proposed to be maintained at 3.3% or lower. The projection for growth of the economy stands at 5 trillion in the next 5 years and 8 trillion in the next 8 years.