Facing criticism of jobless growth in the last four years, the Modi Government announced in the Budget a slew of schemes to boost employment generation in a big way.
The measures include enhancing the lending target under the MUDRA (Micro Units Development and Refinance Agency Ltd) Yojana. The scheme will fund self-employed entrepreneurs to the tune of Rs 3 lakh crore for the year 2018-19. A greater thrust on Make in India scheme to generate employment and to lowering the corporate tax rate are also expected to boost employment creation.
The two new initiatives under the Ayushman Bharat programme — setting up of 1.5 lakh Health and Wellness Centres and the flagship National Health Protection Scheme — are not only expected to address health care but also “generate lakhs of jobs, particularly for women”.
The Government has also proposed a provision of Rs 3,794 crore for the Medium, Small and Micro Enterprises (MSMEs). This is expected to give a fillip to this sector of companies and facilitate in job creation. The Government also announced a reduction in women employees’ contribution to EPF to 8 per cent for first three years and extended the fixed-term employment facility to all sectors to create more jobs.
The projects related to roads, transport, highways, aviation and smart cities are also expected to create tens of thousands of jobs.
The Budget also proposed to extend the facility of payment of 12 per cent employers’ contribution by Government towards social security schemes run by Employees Provident Fund Organisation (EPFO) for new employees for first three years of their employment to all sectors. This will incentivise new recruitment.
To incentivise the MSMEs, the Government has lowered the corporate tax rate to 25 per cent for companies with a reported turnover of up to Rs 250 crore in the financial year 2016-17. In last year’s Budget, this benefit was limited to companies with a turnover of under Rs 50 crore. According to the finance Minister, this move will benefit 99 per cent of companies filing returns, leaving them with a higher investible surplus, which in turn will create more jobs. The Government has pegged Capital Expenditure at Rs 1.48 lakh crore for Railways, while allocating Rs 6,602.86 crore for the aviation sector which will also create employment at large. Similarly the Government has taken the onus of constructing 35,000 km of roads under the Bharatmala Pariyojana project for which the Budget allocated is Rs 5.35 lakh crore and will also create employment.
Presenting the Union Budget 2018-19, Union Finance Minister Arun Jaitley said that creating job opportunities and facilitating generation of employment has been at the core of the policy-making. Launched in April 2015, Rs 4.6 lakh crore credit has been sanctioned under the scheme so far to 10.38 crore beneficiaries. Of the total loan accounts, 76 per cent are of women and more than 50 per cent belong to SCs, STs and OBCs, he said. “It is proposed to set a target of Rs 3 lakh crore for lending under MUDRA for 2018-19 after having successfully exceeded the targets in all previous years,” he said. The Budget for the current fiscal had announced a loan target of Rs 2.44 lakh crore under the MUDRA Yojna. These loans are available for non-agricultural activities up to Rs 10 lakh and activities allied to agriculture such as dairy, poultry; bee keeping are also covered under it.
Job creation has become a major challenge for Prime Minister Narendra Modi. He had promised to create 10 million jobs a year during his campaign for the 2014 Lok Sabha elections. While nearly 10 million Indians enter the workforce every year, emerging technologies such as automation and artificial intelligence are expected to take away jobs in several sectors. According to the International Labour Organisation, only about 823,000 jobs had been created in the country till October last year.