Union Budget of India – What It Has for the Enthusiastic Traders of the Nation?
Union Budget is also known as the annual budget which is released every year and contains all estimated payments and receipts of the upcoming year.
UNION BUDGET OF INDIA
As per Article 112 of the Indian Constitution Act, the Annual Budget of the year, popularly known as the Union Budget of India is a detailed statement consisting of all the estimated and obvious payments and receipts that are going to happen in the coming financial year. The union budget is always declared on the first day of February every year by the Union Minister of India, Nirmala Sitharaman, and comes into force from the 1st of April till the 31st of the march of next year. This annual budget is majorly divided into two main categories – Revenue budget and Capital budget.
The Revenue Budget encompasses all the receipts (tax/non-tax revenue) and expenditures made by the government throughout the year. This budget heads all the daily expenses and income of the government. On the other hand, a Capital Budget includes all the capital receipts and payments of the government like the loans given to the general public and foreign governments are the main sources of receipts, whereas expenditures done on developmental projects like machines, buildings, or health facilities come under capital expenditure of the government.
WHAT DOES THE FEDERATION OF INDIAN EXPORT ORGANISATION (FIEO) DESIRED TO GET FROM THE UNION BUDGET 2023?
The main points that were put forward by the FIEO prior to the budget so that they can get a bit of assistance from the Indian government too were as follows:
- FIEO demanded ease in liquidity at low prices so as to export-oriented items. The organization hoped for the extension of the Emergency Credit Line Guarantee Scheme (ECLGS) scheme till March 2024.
- FIEO demanded the exemption of IGST on freights levied on exports and the expansion of Pre-shipment Credit in Foreign Currency (PCFC) to 1 year from 6 months.
- FIEO asked for a brand new Transport and Marketing Assistance (TMA) scheme for those who are into exports of Agri products.
WHAT IS ACTUALLY PROVIDED BY THE UNION BUDGET 2023-24 TO THE INDIAN TRADERS?
Key highlights of the changes and updates that took place in the Import and Export duties of goods in the Indian Union budget 2023-2024 are:
- This year, the prices of bicycles and toys imported to India would become costlier.
- If you are going to import an electrical chimney for your kitchen this year, you have to pay more bucks for that.
- All the luxury cars and electric vehicles imported from other nations to India would be priced higher than before.
- Import duty levied on silver bars will go up to match the duty levied on gold and platinum items.
- Importing camera lenses from other countries would charge lesser than before.
- Customs duty applied on crude petrol will fall to 2.5%.
- Customs duty levied on open cells of TV will fall to 2.5%.
- Basic customs duties on goods except textiles and agriculture will become 13% from 21%.
DID FIEO GET WHAT IT DEMANDED FROM THE UNION BUDGET?
If we believe the statements given by the industry experts and industrialists, the budget has not focused much on the aspects that can significantly affect the exports of the country this year. This year, there are certain tweaks in the customs and duty rates that can help to grow exports to a certain extent.
As per experts, the budget is focused on uplifting domestic businesses and MSMEs by giving them certain incentives and work benefits but as such, there is no special emphasis given dedicatedly to the imports or exports.
The budget certainly reduced customs duty and taxes on certain items so as to make them cheaper in the nation and also gave a thought to the IGST exemption demand of FIEO.
BENEFITS FOR MARKETERS AND TRADERS DERIVED FROM UNION BUDGET 2023-24
Some of the key benefits derived from this year’s annual budget are as follows:
- Significant boost will be given to the MSMEs. It is a bright chance for them to upscale and grab all the opportunities in their way.
- Fall in customs duty on crude petroleum will attract more imports of the same and we estimate that the prices of crude petrol will go down in this year.
- We can expect cheaper television sets this year due to a fall in their customs duty. It is estimated that imports of TV and spare parts would rise this year and would contribute much towards the Global Trade Data for India.
- There would be increased imports and exports of goods other than textile and Agri products.
REASONS WHY MARKETERS ARE NOT HAPPY WITH THIS YEAR’S UNION BUDGET
Some of the main key reasons due to which marketers find this year’s budget as not fruitful are:
- No special significance is given to the imports and exports sector of the country.
- Nothing is told about the IGST exemption on freights as of now.
- No mention is given to the extension of the ECLGS scheme till now.
- Very low level of attention is given to businesses related to international markets.
As we reach the end of this blog, we can definitely see that all the traders and marketers of India are having mixed feelings with regard to this year’s union budget. This is so as all the marketers who deal in importing crude oil or TV sets would find this budget to be good as the customs duty on these items is reduced. On the other hand, marketers who deal in textiles and automobiles won’t find this budget that good as no provision is made for them.
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