Describing the first full-fledged annual budget of the new Indian government as growth oriented, the American media on Saturday said the announcements made by Finance Minister Arun Jaitley will boost investment and focus on infrastructure.
The budget promises to boost growth with a major increase in public spending on infrastructure and to lower the corporate tax rate by five per cent, steps that were cheered by Indian industry, The New York Times reported.
“Those moves were balanced by the relaxation of targets for spending cuts and the introduction of a new social security plan to provide subsidized insurance and pensions for poor Indians,” the report said.
Though Saturday is usually a trading holiday, India’s financial markets opened for the much-anticipated budget speech, but neither they, nor most analysts, detected the dramatic reforms that some of Prime Minister Narendra Modi’s supporters have been urging, the report said.
According to The Wall Street Journal, Modi’s budget balanced the need for fiscal responsibility with the imperative of greater public-sector investment to lay the groundwork for economic growth.
“The Modi government has benefited this year from a sharp decline in global petroleum prices. Jaitley promised all of the savings from the petroleum price plunge would be invested in capital infrastructure,” the report said.
“That, combined with the infrastructure improvements promised in the railway budget last week, herald a new era in which India’s budgets support the country’s growth,” it said.
The Washington Post, however, is of the opinion that it was a a “cautious budget”.
“The government presented a cautious budget that appeared designed to keep at bay criticism of being too business-friendly and too heavy on welfare measures,” said the report.
It said that the budget failed to fulfil expectations of big economic reforms for Prime Minister Narendra Modi’s first full-year budget.