Budget 2024: Continuity, with an eye on the future

Union Budget 2024-25: It was difficult to argue with the nine focus areas that Finance Minister Nirmala Sitharaman outlined in her Union Budget speech in Parliament on Tuesday. From employment and skilling to manufacturing and services, the themes perfectly captured the challenges and opportunities that India must focus on in its quest to become the world’s third-largest economy and, eventually, attain the status of a developed country.

Policy continuity was clearly reflected in the Budget, with the finance minister keeping infrastructure spends unchanged, lending support to startups and laying out plans to double down on technology efforts and further boost India’s Digital Public Infrastructure (DPI).

Among the positive features of Monday’s Economic Survey was the increase in foreign tourist arrivals in 2023. India welcomed 9.2 million international tourists last year, registering a 43.5 per cent year-on-year increase. While that cements India’s standing as an emerging global tourism hub, it would be foolish to ignore the large opportunity that rural tourism presents.

Tourism boost 

It was encouraging to see the finance minister recognise that and announce plans to develop corridors at the Vishnupad and Mahabodhi temples in line with the Kashi Vishwanath Temple in Varanasi. The decision is also an ode to the rising popularity of spiritual tourism, with more people opting to visit cities such as Ayodhya, Puri, Amritsar and Shirdi, among others.

With tourism such an intrinsic part of our civilisation, the development of religious towns often leads to broader regional development. With the rise in popularity of religious travel - especially among youngsters - there are several spiritual sites across the country waiting to be transformed. It is essential that we develop new tourism destinations, and it was pleasing to see the government earmarking Odisha as a travel hub with the intent of promoting its ancient temples and picturesque beaches.

None of this would be possible without a sustained infrastructure push. The finance minister's decision to keep the infrastructure spending intact underlines the government's commitment to spurring growth and creating jobs. This is bound to push would boost tourism and see the emergence of new tourist places, especially in rural and semi-urban India.

Startup front 

On the startup front, the decision to do away with ‘angel tax’ should come as a major relief, especially for companies that have been bearing the brunt of the funding winter. The removal of the tax, a long-awaited reform for early-stage startups, represents a significant advancement in establishing India as a leading innovation hub. By alleviating the financial pressures on young companies, the change is expected to ease their access to international investment and support their global aspirations.

The change also signifies a larger shift. Once bit-part players, startups are increasingly driving the next wave of economic growth. As the world’s third-largest startup ecosystem, entrepreneurship's mainstream status is a confirmation of how startups, to some extent, have altered the Indian psyche as we go from job seekers to job creators. That is especially striking for a country whose youth was once known to relentlessly pursue the supposed safety of a government job.

One of the most notable developments of the past decade has been the swift digital transformation of Indian society. India's strong DPI was showcased to the world at last year's G20 Summit. The finance minister's call for private companies to contribute to the development of DPI applications is expected to drive innovation. The initiative, targeting sectors like e-commerce, education, healthcare, logistics and urban governance, has the potential to advance technologies such as artificial intelligence (AI).

The focus on technology as an enabler for workforce productivity is praiseworthy. The digital revolution has been a game-changer for Indian entrepreneurs. Take the hotel industry, for instance. The integration of technology has redefined customer experiences, from online bookings to personalised services. Startups have leveraged artificial intelligence and data analytics to tailor offerings, making each guest interaction more meaningful. 

However, the larger focus must be on skilling if we are to build a future-ready workforce. The announcement of a centrally funded skilling initiative, working in tandem with states, aims to skill two million young people over the next five years, which should significantly help bridge the existing skills gap. Additionally, the plan to provide internships to one crore young job seekers will help prepare a workforce that can compete globally.

By focusing on key areas such as infrastructure, tourism, innovation and skilling, the Budget not only addresses immediate needs but also sets the stage for long-term growth and achieving the objective of ‘Viksit Bharat’.
 

(The author is Founder & Group CEO, OYO)