21

Dear Readers

All Bharatwasis celebrated Republic Day of our Bharat Mata on 26th January’ 2023 with great joy and with a spirit of dedication to our great Nation “Bharat“. Tribute was paid to Netaji Subhash Chandra Bose on 23rd January 2023 for his warrior and Motherly nationalist spirit. He was championing equality, harmony, inclusiveness and eradication of poverty. Reverence and homage was paid by joyous celebration to Paramananda Sri YoganandaJi on 5th January 2023 and revered Swami Vivekananda on 12th January 2023.
Indian Economy: A World Bank report said that navigating the storm India’s economy is relatively insulated from global shocks as compared to other emerging markets. India’s economy has been remarkably resilient to the deteriorating external environment. United Nations reported India’s Gross Domestic Product (GDP) growth rate is projected to be moderate to 5.8% in 2023 from an estimated 6.4% in 2022. The government has estimated India’s real GDP growth in FY 23 at 7% as compared to 8.7% in 2021 – 22. India is said to become the 5th largest economy in the world.
It is expected that India will continue to be the low cost economy for may be another two decades. India’s financial system is robust and sustainable. Our external debt and Current Account Deficit (CAD) is well within the standards of viability as per international criterions.
Tax: For faster growth of economy tax policy in regard to corporate tax, individual tax, GST, TDS including global minimum tax needs to be reformed. Stringent laws including criminalization laws related to commercial/financial crime is required. FM Nirmala Sitharaman said to reform and rationalise the tax structure for individual and corporates. It is essential to increase consumption and savings, protect future and for corporates to invest more and have morereserve for the bad times. FM should allow 30% of net profit to be transferred to an emergency/crisis fund to fall back at the time of financial crisis due to external factors. Agricultural inputs and equipment’s should be free from the clutches of GST.
IBC: Enterprises failing to make payments in time and asking for more time should be referred to a National Assets Appraisal Authority which needs to be set up. This organization after appraisal will refer to RBI for appropriate action. No case should be referred to National Assets Appraisal Authority either by lenders or an advice of RBI to lenders. This will save wastage of national assets from being deteriorated or disposed by sale.
Private capital expenditure will remain dormant due to worst global scenario and fearsome criminal action and taking over of enterprises due to default which is temporary, even due to external factors including global.  IBC process takes long long time. During this process value of enterprise and assets quality deteriorates steeply. Government has set up National Asset Reconstruction Company Limited (NARCL). They have first taken over Japypee Infratech which was their first acquisition and many more are there in their attempt. When the government is selling PSUs due to poor undertaking, how National Asset Reconstruction Company Limited (NARCL) will take over so many enterprises? If not, they might be selling at lower price than their acquisition.
Budget: Budget will be oriented to take care of global threat for growth and employment. Expenditure and subsidy should be production oriented. FM Sitharaman presented holistic, pragmatic, inclusive budget to address the hostile and uncertain external environment reviving the animal spirit of the wealth and job creators for investment and growth in agriculture to meet the and domestic food need and relief to the middle class by restructuring and reforming the tax structure and basic need of education and health.
Tourism and infrastructure has been given push. 10 trillion capex outlays including 3 trillion long term loan to the state governments were allocated with thrust to road, rail and defence. Government is to infuse ` 9000 crore into the system to revamp creditor’s scheme for SMEs. In agriculture credit target of 20 trillion to this fiscal has been decided focusing on dairy, animal husbandry and fisheries. 5.9% target of fiscal deficit for FY 23-24 is seems to be achievable. FM has announced the setting up of 10,000 Bhartiya Prakritik Kheti Bio–Input Resource Centres over the next three years for natural farming. Concessional corporate tax is not extended, rationalisation of capital gain tax is also ignored. Tax relief to individual income is not
structured to meet the middle class household expenses and also the basic needs of individual families of 2 children. Tax of 30% is imposed on income above ` 15 lakhs per annum which is higher than even corporate tax. It should have been above ` 20 lakhs per annum. A rate of 30% should have been levied on income above ` 50 lakhs per annum. Education has become
very costly. Citizens following the old and new tax regime will be confused, only beneficial to the tax consultants and authorities.
Global Economy: IMF has projected the global growth rate slowed down to 2.4% in 2023 due to high rate of inflation. According to the World Bank analysis recession can be escaped by the world by additional monetary policy.
Cover Story: India’s population is rising. It will surpass China’s population by 2023. Population will be around 140 billion. China is worried/concerned about the declining growth. So far agricultural growth needs is to be met for the rising population growth. Developing countries has more than 60% of the world’s population. Their need for food has to be met. If agricultural activity is not ramped up, there may be global food crisis.
Indian agriculture is often damaged by floods and drought. Marginal farmers are the most affected. Their income is not sufficient to support two square meals. Population growth is higher thereto. They are forced to migrate and search for work in cities and towns. They cannot have other source of income like cattle farming and livestock farming. In cattle farming the great problem is of male calf. Male calves are not being used for agriculture purpose due to introduction of modern equipment. Against their conscience farmers cannot sell such animals to butcher house. Government needs to find a solution. It is viewed that male calves should be sent to government forest area where they can have their own food.
Institutional credit needs to be provided to use the outcome of the research and at the time of ravage of natural disaster.
It is estimated that due to poor agricultural infrastructure, inadequacy of storage facilities including cold chain and lack of adequate food processing units, post-harvest loss is over ` 2 lakh crore per annum. Despite independence of 75 years the Nation has done little to provide adequate storage facilities and in improving the logistics. However, within two and a half years of establishment of Agriculture Infrastructure Fund (AIF) the schemes has mobilized more than `30,000 crore projects with a sanctioned amount of ` 15,000 crore under the fund .
Nation’s export and import policy should not be a constraint. To ban the export of specific items results in loss of market. Import should be curbed for the growth of that product in the Nation. Import of products lower the prices of domestic produce of those items, affecting the farmers. Let the consumer pay higher price or curtail the consumption. It will save the declining forex reserve also. MSP (Minimum Support Price) does not fully reflect the cost structure of farming.
Market prices are higher than MSP and marginal farmers are not benefitted thereto.
NITI Aayog said that agricultural sector could be the silver lining for the Indian economy. It has projected that this sector can grow at more than 3%. Export of agricultural products grew by about 20% in 2021–22 to touch USD 50.21 billion. The growth rate is significant despite unprecedented logistics challenges.
Farm export grew 12.6% on year until December this fiscal to $ 38.5 billion and exceeds farm exports higher than 10.2% of overall merchandise exports. Aggressive and smart farming with innovation is required to boost the income of the farmers. To transform the agri–sector, free farmers from the state control said Bibek Debroy. He said that farmers are more entrepreneurial than corporates as they keep taking more risks all the time. More lanes need to be diverted to Horticulture and organic farming with ease of technology to save the marginal farmers by increasing their income. US agriculture pattern has helped them to progress many years back since 1900 and had been feeding the world including India.
After 2023, as per WTO rules, India cannot export agri–products having subsidies. Agri–products need to be globally competitive.
MSME: MSME’s contribute almost 29% to the Gross Domestic Product (GDP). Availability of Finances is limited due to lack of data’s and conservativeness of the lenders. NFBCs play a good role in meeting the credit needs of MSMEs.
Bharat needs to focus on to provide food, housing, health services and education to all. Government/authorities should also set up a National Emergency Relief/Short Financial Organisation. Any enterprise having temporary setback due to external factors can approach for short time finances from them. Corporates/entrepreneurs can contribute 10 to 25% of their net profit to the fund which should be allowable expenses.
The Nation Will still remain one of the fastest growing major economy.
Surveys said that agri-sector needs reorientation to face climate change impact. Food processing sector also needs to be developed to reduce wastages.