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Modi government may take major decisions in the budget to increase demand in the market

Tuesday - January 28, 2020 2:20 pm , Category : BUSINESS
It’s necessary to increase the growth rate to face the economic slowdown
It’s necessary to increase the growth rate to face the economic slowdown

Modi government can give big relief in the budget to overcome the economic slowdown

JAN 28 (WTN) - In the midst of the global economic slowdown, there are many expectations from the Modi government's general budget. In the current financial year, this time budget is not less than any challenge before the Modi government due to the GDP growth rate decreasing continuously. In such a situation, the people of the country have set high hopes from the Finance Minister Nirmala Sitharaman. The Indian economy has been facing an economic slowdown for a long time due to many other reasons including the US-China trade war. In such a situation, the industry is suffering due to a lack of demand in the market. The economic slowdown has been the biggest impact on the automobile sector, where the recession has been going on for the last 18 months.
Now that the country is slowly recovering from the phase of the economic slowdown, from the Modi government's budget, along with the common people, the industry has high hopes. Everyone wants the Modi government to take some measures in this budget that will give relief to the people recovering from the economic slowdown and there should be the end of the period of slowdown in the market. Due to this, it is being said that the Modi government may increase the income tax exemption limit for the middle class in this budget.

Explain that according to economists, the most need in the economy at this time is to increase demand and consumption. It is natural that economic activity will accelerate only due to an increase in demand, but to increase demand and consumption, along with increasing capital expenditure, more money is necessary for the common man's pocket. According to economic affairs experts, the government can free up to 5 lakh rupees annual income of income tax to increase demand and consumption in the budget to deal with the slowdown in the market due to the economic slowdown.
By the way, to deal with the economic slowdown, the government is working on several structural schemes on the capital expenditure front. But with this, the middle class can be given relief in the income tax, so that they can have more money left and they use that money in the purchase which will increase the demand in the market. At the same time, it is being said that in this budget, the government will take measures to increase employment and at the same time will try to increase capital expenditure, so that people can get more money.

In fact, the current slowdown in the economy is due to a decrease in demand and not in the supply. Constant production is being done by industries, but due to the economic slowdown, people are spending less due to which goods are selling less in the market. Now, the demand for the purchase from the people will increase, so the government wants that people have more and more money left. It is natural that people will spend more and more when they have money left. In such a situation, to encourage the middle class to spend, the Modi government may increase the existing income tax exemption limit from Rs 2.50 lakh to Rs 5 lakh. Apart from this, the Modi government can also change the tax slab in the budget this time. Let the economists believe that the government should reduce the direct tax burden on the wage earners.
It is clear that when the tax burden on the people is reduced, they will have more money left than before. Now when people have more money than before, they will use it in the purchase and when people buy, it will increase the demand in the market. The government wants that people should spend more and more money so that the market gets capital and the goods produced by industries are sold. If the demand increases, then the supply will also increase accordingly in such a way that the money circle will start so that the economy will boom once again.

Apart from the demand for the income tax exemption, there is a demand from the people under Section 80C of the Income Tax Act, the existing exemption limit of Rs 1.50 lakh on the life insurance premium, tuition fees and other savings should be increased to Rs 2.50 lakh. By doing this, the middle class will get a lot of relief and the salaried people will have more money left than before and they will be able to use the saved money in the expenditure. The Indian economy, which is recovering from a period of the economic slowdown, needs to increase the purchasing of people in the market at this time. Goods are ready by industries, but buyers are not buying those goods. In such a situation, the income tax exemption will save people more money and if the people used this money in the purchases, then once again the Indian economy will be one of the fastest-growing economies of the world.