US India Business Council says 2024 budget shows India's efforts to boost jobs

THE US India Business Council (USIBC) on Thursday (1) praised initiatives outlined in Indian finance minister Nirmala Sitharaman's interim budget presented the same day as the Narendra Modi government's crucial steps towards bolstering job creation and productivity.

The USIBC works towards fostering an inclusive trade environment between the two democracies. Serving as the industry's voice, it facilitates connections between governments and businesses while promoting enduring commercial collaborations.

Highlighting India's focus on budget consolidation as vital for maintaining credibility with foreign investors, USIBC president Atul Keshap commended the budget's strategic emphasis on technology, green growth, and infrastructure, alongside commitments to public health and macroeconomic stability.

Read: India's interim budget 2024: The positives & not so positives

Keshap noted that these measures are poised to drive sustainable growth, improve productivity, lower logistics costs, and enhance overall well-being, aligning with key bilateral initiatives such as the Initiative on Critical and Emerging Technologies (iCET) and the Innovation Handshake between India and the US.

The USIBC chief commended the Indian government's continued commitment to developing the country's semiconductor ecosystem and accelerating its ‘deep tech' sector through additional financial support and public-private partnerships.

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"We also look forward to learning more details about the significant commitment of USD 12 billion to long-term low or no interest financing for so-called ‘sunrise sectors,' which has significant potential to enhance innovation," Keshap said.

Observing that sustainable growth is critical to ensuring that India's economic expansion supports individual well-being, the USIBC chief lauded the vision of bringing clean energy generation and use to peoples' doorsteps through rooftop solar power for 10 million households as well as viability gap funding for one gigawatt of wind energy.

The emphasis on promoting green manufacturing of alternative materials through biomanufacting and biofoundaries is also a step in the right direction. These demand signals can help promote India's leadership of the green economy and integration into its global value chains, he said.

“These initiatives, along with the 11 per cent increase in capital expenditure — a real rupee increase on top of massive growth in prior years — are all examples of government outlays aimed at increasing job creation and productivity, especially to the extent the capex enhances transportation infrastructure and multi-modal connectivity. Universal vaccination to prevent cervical cancer is a critical step in ensuring a healthy workforce and equitable society,” Keshap said.

Sitharaman in the budget proposed no changes in income tax rates for individuals and corporations, as well as customs duty. She hiked capital expenditure to Rs 11.11 lakh crore (£105.7 billion) for 2024-25 while trimming the fiscal deficit for this financial year to 5.8 per cent, from the budgeted 5.9 per cent of GDP, and further lowering it to 5.1 per cent in the next fiscal.

“India's ongoing focus and execution on budget consolidation, including beating its fiscal deficit target for this past year, is important to maintaining and enhancing its credibility with foreign investors,” Keshap said.

(With PTI inputs)