India's Finance Bill Cleared by Lok Sabha, Sitharaman Hails Growth
Nirmala Sitharaman, the Union finance minister, affirmed that India's economic expansion has been inclusive, fostering employment while maintaining inflation at bay. This declaration came as the Lok Sabha approved the Finance Bill 2024, marking the conclusion of the interim budget 2024-25 passage process. She further stated that the Central government is diligently allocating funds to all states, surpassing the Finance Commission's recommendations, including Karnataka.
During a session in the Lok Sabha concerning the Union government's interim budget for FY25 and the interim budget for Jammu and Kashmir (J&K), Nirmala Sitharaman underscored the government's role in fostering job creation. The finance minister highlighted, "The proportion of the labor force in the country has risen from 49.8% in 2017-18 to 57.9% in 2022-23". Furthermore, she noted a decline in the unemployment rate from 6% in 2017-18 to 3.2% in 2022-23. Sitharaman also pointed out that since May 2020-23, the number of new subscribers to the Employees' Provident Fund Organisation (EPFO) aged 18-25 has consistently comprised over 55% of the total net new subscribers.
The participation of women in the labour force also rose to 37% in 2022-23, signifying a substantial increase in women coming to the workforce, she said. "During 2022-23, a total of 28.7 lakh (2.87 million) net female subscribers were added on to EPFO So women are coming into formal jobs", she said. The Lok Sabha approved the interim budget for 2024-25 and the second supplementary demand for grants (2023-24) of the Union government, alongside passing the interim budget of Jammu and Kashmir for FY25 and its supplementary demands for grants for 2023-24. The House gave its consent to the budgets and appropriation bills through a voice vote.
Discussing the Union interim budget for FY25, she emphasized the government's adherence to the spirit of Vote on Accounts. She pointed out that the interim budget allocates Rs 11,11,111 crore for capital expenditure in 2024-25, marking a 16.9% increase over the Revised Estimates of 2023-24. "This allocation surpasses the anticipated GDP growth rate of 10.5%", she noted, underscoring the government's ongoing commitment to infrastructure development to sustain growth momentum.
The government has been "fairly prudent" in remaining on the path of fiscal consolidation, Sitharaman said, as the budget revised the fiscal deficit estimate for FY24 to 5.8% of GDP from 5.9% estimated in the previous budget. She added that despite it being an interim budget, the government raised or maintained allocations on an annualized basis for key sectors such as education, health and family welfare, ministry of minority affairs, rural development, and women and child welfare.
Regarding the FY24 supplementary demand, she outlined fund allocations. This includes Rs 3,000 crore for the Department of Fertilizers' subsidy scheme, Rs 9,231 crore for PMGKAY under the Department of Food and Public Distribution, Rs 13,548 crore for defense services' revenue expenditure, Rs 5,000 crore for the Senior Citizen Welfare Fund via the Department of Economic Affairs, and Rs 3,000 crores for Jammu and Kashmir's additional expenditure as central assistance.
She noted that Jammu and Kashmir's FY25 interim budget is Rs 59,364 crore for part of the year, with a total annual estimate of Rs 1,18,728 crore. Seeking Rs 8,713 crore in supplementary grants for 2023-24, primarily for debt repayment and power procurement. The government launched subsidized "Bharat" brand food items like flour, pulses, and rice to curb inflation and assist those with limited means. For instance, Bharat Aata is priced at Rs 27.50 per kg, with 237,000 metric tonnes sold by January 28, 2024. Similarly, 297,000 metric tonnes of Bharat dal, including chana dal at Rs 60 and Rs 55/kg based on packet size, have been sold by January 30, 2024.
Regarding the recent accusations from the Karnataka government that the Center hasn't allocated sufficient funds to states, Sitharaman said, "I want to assure this House and I'll give you the data, whatever the Finance Commission has recommended, I follow it to the last word". Furthermore, she stated that Karnataka has been granted interest-free loans for 50 years to support infrastructure development.
