The Union Budget 2020-21: A mixed bag of cheers and tears

Tandon, Anjali (2020): The Union Budget 2020-21: A mixed bag of cheers and tears. Published in: Journal of Business Thought , Vol. 11, (2020): pp. 29-39.

Abstract

The Budget 2020-21 can be considered as transitional in nature as it seems to direct money flows to business through reforms on corporate tax. Apparently, the government is commanding a model of investment driven economic growth for long-term sustainability. However, under current crisis with regard to jobs, unemployment, demand depression and low consumption, the economy requires immediate stimulus package, which is absent in the budget. There seems to be an attempt to energise consumption through tax benefits on dis-saving. This however dis-regards the link between savings and consumption, as the former are used to finance consumer durables such as cars, electronics and real estate purchase. The importance of savings cannot be overstated in an economy where there are no provisions for universal healthcare, social security, and unemployment allowances.

• Item Type: MPRA Paper
• Language: English
• Keywords: Disinvestment, Subsidy, Tax Reform, Union Budget, India
• Subjects: E - Macroeconomics and Monetary Economics > E6 - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook; H - Public Economics > H6 - National Budget, Deficit, and Debt

References

Bhattacharya, K. 2020. “Economists Speak 2020 India Union Budget”, as quoted in The Edition, Februry 9, accessed at https://intheedition.wordpress.com/2020/02/09/e-c-o-n-o-m-i-s-t-s-s-p-e-a-k-2020-india-union-budget/?fbclid=IwAR2NiDExSL5RPHZCZWdBhYYGGS8TGh5EObzOySiiWO4gp5EueE_Tq5HK_3Q

Business Standard, 2019. “ Demonetisation, 3 years on: A look at impact on key sectors of the economy”, November 8, accessed at https://www.business-standard.com/article/economy-policy/demonetisation-3-years-on-a-look-at-impact-on-key-sectors-of-the-economy-119110701482_1.html

Chaudhuri, L. 2020. “Economists Speak 2020 India Union Budget”, as quoted in The Edition, February 9, accessed at https://intheedition.wordpress.com/2020/02/09/e-c-o-n-o-m-i-s-t-s-s-p-e-a-k-2020-india-union-budget/?fbclid=IwAR2NiDExSL5RPHZCZWdBhYYGGS8TGh5EObzOySiiWO4gp5EueE_Tq5HK_3Q

Ghosh, S.K. and Ghosh, P. 2020. “The Determinants of Household Savings in India”, Business Standard, February 12. Government of India, 2020a. Economic survey 2019-20, Department of Economic Affairs, Economic Division, Ministry of Finance.

Government of India, 2020b. Union Budget 2020-2021, Ministry of Finance.

Gupta, U. 2020. “Drastic cut in food subsidy – real or fudged”, February 7, accessed at https://www.uttamgupta.com/agriculture-foodgrain/drastic-cut-food-subsidy-real-fudged/

Pal, S. 2020. “Economists Speak 2020 India Union Budget”, as quoted in The Edition, Februry 9, accessed at https://intheedition.wordpress.com/2020/02/09/e-c-o-n-o-m-i-s-t-s-s-p-e-a-k-2020-india-union-budget/?fbclid=IwAR2NiDExSL5RPHZCZWdBhYYGGS8TGh5EObzOySiiWO4gp5EueE_Tq5HK_3Q

Ramanjaneyulu, G.V. 2019, “A Perspective on the Agricultural Crisis in India (Part 1)”, as quoted in 
 F. Athar, June 10, accessed at https://indiabioscience.org/columns/conversations/a-perspective-on-the-agricultural-crisis-in-india-

Vishnu Padmanabhan, V. and Dantewadia, P. 2020. “The Geography of Farmer Suicides”, LiveMint, January 16, accessed at https://www.livemint.com/news/india/the-geography-of-farmer-suicides-11579108457012.html