With the Union Budget less than three weeks away, every sign counts, especially as the budget-making seat, North Block, is almost sealed. So when the government on Wednesday renamed the Cabinet Committee on Employment and Skill Development as the Cabinet Committee on Skills, Employment and Livelihoods, the announcement sent a message for the budget. By prioritizing skills before employment, is the government suggesting that skill development is now its main focus area against the backdrop of labor shortages that are hampering factories and manufacturing hubs? And by bringing the economy under the purview of the committee, is it broadening the canvas of jobs and employment in the current context? Probably.

Apart from the reconstituted Cabinet Committees, budget cues have also come from the President’s address to Parliament, the Prime Minister’s reply and the first Cabinet meeting of the 18th Lok Sabha. President Draupadi Murmu has said that the budget will usher in historic initiatives that will cover economic and social issues, and that reforms will be the focus. Prime Minister Narendra Modi has talked about taking India to the next level of development and achieving the goal of Vikas Bharat (Developed India) by 2047. He has emphasized that his government will work at triple speed this time. The first cabinet meeting of Modi 3.0 also gave some broad hints on the road map that could be outlined in the budget for welfare schemes. The Cabinet decided that the Center will provide assistance to 30 million additional rural and urban households for construction of houses under the Pradhan Mantri Awas Yojana (PMAY). All these measures can lead to job creation, but of course we cannot yet be sure about the quality and longevity of these jobs.

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After the budget, likely to be decided in the fourth week of July, only eight months remain in FY25. In this scenario, this budget has an opportunity to go big on ideas that can set the tone for Modi 3.0, without changing the numbers too much. It is possible that the budget was pushed to the end of July so that it worked in a more conceptual manner after the election results significantly changed the narrative. Ahead of the elections, bureaucrats were targeting late June or early July for the budget. At that time there was neither a coalition government nor a strong opposition in the picture.

If this is indeed a budget with big ideas, quality job creation and skill development should be the focal point, cutting across ministries and departments. For this, cooperation between industries and academic institutions within the country and abroad should have a prominent place in budgeting. This would mean partnering with organizations, businesses and institutions in Taiwan and China, among others, to boost India’s manufacturing in semiconductors and electronics. So far, India has taken only small steps in these areas and will need to collaborate with global powers to make it big in manufacturing and, in the process, create jobs.

In her interim budget speech in February, Finance Minister Nirmala Sitharaman mentioned the need for industry-academia collaboration. This time, the budget could give the initiative a big push. To do this, research and development (R&D) should also get its due.

In the February budget, the FM announced Rs 1 trillion to fund research in technology and proposed a scheme for deep tech innovation. But overall, India’s R&D spending as a share of gross domestic product (GDP) is less than 1 percent and compares poorly with other economies such as the US, Germany, China and South Korea. Also, in India, private sector gross domestic expenditure on R&D (GERD) is less than 40 percent of the total. Globally, in some innovation-focused countries such as Japan, the US, Germany and South Korea, a large share of R&D funding, 65 to 70 percent, comes from private enterprises.

While jobs, innovation and the like may gain attention as bureaucrats refine their proposals, taxes still garner the most attention during Budget Day and the countdown. In this context, this is the desire of the budget watcher who was part of budgeting in the past. Clean up the direct tax regime across various asset classes to encourage financial savings and further widen the capital market. reducing customs tariffs and encouraging industry to become part of a global supply chain; Proactively sign free trade agreements with the major objective of promoting exports of goods; and set up a “Productivity Commission” for agriculture and allied sectors to increase agricultural income.

Now that the FM and his team are done with all the input sessions with the stakeholders, keeping in mind the need of the hour and the signs all around, it’s time to push the big ideas for D-Day. has come

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