India's Finance Minister Shri Arun Jaitley has revealed in his Budget that goods and services tax (GST) will be part of a state-of-the art indirect tax system by 1 April 2016, while corporate tax will likely be cut from 30% to 25% over the next four years. The proposals were part of a Budget announcement that included measures to improve human resource skills and encourage innovation across the country.
Training and development
The Minister emphasised formal skills training and said the government will launch a National Skills Mission which will consolidate skill initiatives spread across several ministries. “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,” he said.
An Indian Institute of Technology (IIT) will be set up in Karnataka and Indian School of Mines, Dhanbad will be upgraded in to a full-fledged IIT. Institutes of Science and Education Research will be set up in Nagaland and Odisha. Indian Institutes of Management (IIMs) will be set in Jammu &Kashmir and Andhara Pradesh. A Centre for Film Production, Animation and Gaming will be set up in Arunachal Pradesh while an Apprenticeship Training Institute for Women will be set in Haryana and Uttarakhand during 2015-16.
Shri Jaitley proposed the setup of the Atal Innovation Mission (AIM) in NITI which will provide an Innovation Promotion Platform involving academicians, and draw upon national and international experiences to foster a culture of innovation, R&D and scientific research in India. Shri Jaitley said that the platform will also promote a network of world-class innovation hubs.
He added that a new Self-Employment and Talent Utilisation (SETU) initiative will support all aspects of startup businesses and other self-employment activities, particularly in technology-driven areas. "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,” he said.
India is making good progress towards digital India, an initiative introduced in the previous Budget. He said the National Optical Fibre Network Programme (NOFNP) of 7.5 lakh* kms, networking 2.5 lakh villages, is being further speeded up by allowing willing states to undertake its execution.
Help for SMEs
Shri Jaitley noted that some 5.77 crore small business units, mostly individual proprietorship which run small manufacturing, trading or service businesses, often have problems getting formal credit. He proposed the creation of a Micro Units Development Refinance Agency (MUDRA) Bank, which will refinance micro-finance institutions.In lending, priority will be given to scheduled caste/scheduled tribe (SC/ST) enterprises.
India's Prime Minister Shri Narendra Modi has welcomed the Union Budget, saying that it will further reignite the country's growth engine. "(The) Union Budget 2015 is a Budget with a clear vision. It is a Budget that is progressive, positive, practical, pragmatic and prudent," he commented. "Atal Innovation Mission and SETU underline our commitment to enable innovation, entrepreneurship and startups to grow and shine in India."
*A lakh is 100,000, and a crore is 10 million.