All efforts of govt directed towards making India $5-tn economy: FM Sitharaman

Finance Minister Nirmala Sitharaman on Monday said that all efforts of the government are directed towards making India a $5-trillion economy and if the pace keeps growing, there is no reason for it to not achieve the target by 2025.

Answering a question about achieving the $5-trillion economy dream by 2025 during Business Today Budget RoundTable 2022, Sitharaman said, "Well all efforts are towards that. And if we continue at this kind of a pace and with more involvement of the private sector, I can't see why not."

She also said that the government has given a parallel and more attractive framework of income tax rates through the new regime and would eventually like to see a simple taxation system.

"Eventually, I would like to have a very simple and low-income tax rate. The government is drawing people out of exemption system has already commenced making it more attractive for compliance," Sitharaman said.

Throwing light on the Union Budget 2022-2023, Sitharaman said, "I provided continuity to some critical policy prescriptions announced in the last year budget." Talking about the formula for the revival of the economy, she added, "We are reinforcing the formula that we adopted, the formula is public investment in infrastructure building that is capital expenditure."

According to Sitharaman, the 14 PLI schemes announced by the government have attracted good response. "PLI was given for 14 sector and has very positive outcome, the response is absolutely tangible which means investments are happening," she added.

She also pointed out the effect of the corporate tax reduction in 2019, and said, "The reduction in the corporate tax reduction paved the way for expansion. All these indicate that private industry is coming with additional investment that will lead to capacity expansion."

Talking about the bond market reaction to the budget, Finance Minister said, "The bond market reaction was not because of the budget, the bond market performance even before the budget was jittery. They are jitterier about US Fed and various central banks' decision across the world and less because of the budget."

In a reply to a question about the doubt of execution of big capex outlay, She said, " This is a reasonable doubt to have, during the Atmanirbhar Bharat announcement we extended money without any interest to the states and they benefitted from this, this has come out even in the pre-budget consultation that if we can fund them for building infrastructure, that is of a huge help for the states."

She added that 50-year; interest-free loan of ?1 lakh crore to states to enable them to spend on capital investments would be very useful for the states. While highlighting the conservative revenue and disinvestment targets, she replied. "I believe that your numbers have to be realistic and your work has to be realistic."

Speaking about job creation, FM Sitharaman said, "people should look at overall developments rather than clinging to one particular number."

"It is not the government alone that is going to be able to provide jobs. It is also recognised that we need to have skills that are adequately imparted to the youth so that they are able to find jobs," FM Sitharaman said.

FM Sitharaman, on being asked about the pressure on her to deliver an election budget, said, "I have had no pressure at all to deliver an election budget. Let me look you in the eye and say this again," she said.

Also read: Will like to have simple direct taxation system with low rates: FM Sitharaman

Also read: Govt’s 'Aatmanirbharta' push not a promising long-term growth strategy: Arvind Subramanian