Budget 2020 will be practical & forward looking, says DCM Shriram

In the run up to budget 2020, CNBC-TV18 spoke with influential voices from India Inc to know what they were expecting from the Finance Minister this time around.

Ajay Shriram, chairman, DCM Shriram is of the view that the budget this time would be practical and forward looking. "I think the government realized that we need to make changes, so that’s a positive sign,” he said.

“I do hope they do something on agriculture because that is 65 percent of our population. We have to give them a stable source of income to be able to survive and become a consumption market like they have for sugarcane, cotton or a couple of crops, they need to do it for lot more,” he said.

When asked what he expected as incentives for agriculture, he said, “More than the push, what is required for the farmer is a good channel for selling their produce. Today, the farmer gets only 25-30 percent of what the retailer pays and that’s too low. They should get at least 50 percent.”

This would mean the middleman have to be removed, a structured system would have to be put in place where there can be a connect between the farmer through Farmer Producer Organisations (FPOs) and the customers. This simplicity and cleaning up would make a lot of difference,  added Shriram.

Talking about boosting consumption he said, “The challenge today is that investments are low mainly because wherever the produce goes, someone has to buy the product at a reasonable price. For that, income in the hands of people have to be given a push. So, even if the fiscal deficit has to go up by 0.5-0.75 percent, there is no harm in pushing the economic activity to a larger level. Once there is a boost to the economy and jobs are created, income levels would go up, consequently government taxes would go up and the entire cycle would get reoriented and get put into place at a faster pace, which would take the entire economy up.”

Moreover, simplification of goods and service tax (GST) will lead to better implementation, he said.