India’s Finance Minister, Shri Arun Jaitley, announced in his Budget speech that a comprehensive goods and services tax (GST) system will be implemented by April 1, 2016. Additionally, corporate tax rates are expected to be reduced from 30% to 25% gradually over the next four years. These proposals were presented alongside initiatives aimed at enhancing human resource capabilities and fostering innovation nationwide.
Training and Development
The Finance Minister stressed the importance of structured skills training, revealing the government’s plan to introduce a National Skills Mission. This program will consolidate various skill development initiatives currently overseen by multiple ministries. He highlighted the demographic context, stating, “India is one of the youngest nations in the world with more than 54% of the total population below 25 years of age. Yet today less than 5% of our potential workforce gets formal skill training to be employable and stay employable.”
Plans are underway to establish an Indian Institute of Technology (IIT) in Karnataka and elevate the Indian School of Mines, Dhanbad, to the status of a full-fledged IIT. Institutes of Science and Education Research will be set up in Nagaland and Odisha. Additionally, Indian Institutes of Management (IIMs) will be established in Jammu & Kashmir and Andhra Pradesh. Further investments in education include establishing a Centre for Film Production, Animation and Gaming in Arunachal Pradesh and Apprenticeship Training Institutes for Women in Haryana and Uttarakhand during the 2015-16 fiscal year.
Innovation
Shri Jaitley proposed the creation of the Atal Innovation Mission (AIM) within NITI Aayog. This mission will establish an Innovation Promotion Platform, bringing together academics and leveraging national and international expertise to cultivate a culture of innovation, research and development (R&D), and scientific research within India. This platform will also focus on promoting a network of globally competitive innovation hubs.
Furthermore, a new initiative called Self-Employment and Talent Utilisation (SETU) will provide support for all aspects of startup ventures and other self-employment endeavors, particularly in technology-driven sectors. “We are now seeing a growing interest in startups. Experimenting in cutting edge technologies, creating value out of ideas and initiatives and converting them into scalable enterprises and businesses is at the core of our strategy for engaging our youth and for inclusive and sustainable growth of the country,” the Finance Minister explained.
Technology Infrastructure
India continues to make significant progress toward realizing the Digital India vision, an initiative introduced in the preceding Budget. The Finance Minister stated that the implementation of the National Optical Fibre Network Programme (NOFNP), which aims to lay 7.5 lakh kilometers of optical fiber connecting 2.5 lakh villages, is being accelerated by allowing interested states to participate in its execution.
Help for SMEs
Shri Jaitley acknowledged that a substantial number of small business units, approximately 5.77 crore, primarily operating as sole proprietorships in small-scale manufacturing, trading, or service sectors, often face difficulties in accessing formal credit. To address this, he proposed the establishment of a Micro Units Development Refinance Agency (MUDRA) Bank, which will provide refinancing support to microfinance institutions. The Bank will prioritize lending to enterprises owned by individuals from Scheduled Castes/Scheduled Tribes (SC/ST) communities.
India’s Prime Minister, Shri Narendra Modi, expressed his support for the Union Budget, asserting that it would further stimulate the nation’s economic growth. “The Union Budget 2015 is a Budget with a clear vision. It is a Budget that is progressive, positive, practical, pragmatic and prudent,” he remarked. “Atal Innovation Mission and SETU underline our commitment to enable innovation, entrepreneurship and startups to grow and shine in India.”