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India's Budget 2020-21: Boosting Agriculture, Rural Infrastructure Amid Economic Slowdown

Facing its lowest growth in over a decade, India's Budget 2020-21 prioritizes rural development and digital connectivity. But can it tackle rising inflation and maintain economic stability?

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In this image there are buildings, bridges, water, architecture, cloudy sky, trees, grass, roads,...
In this image there are buildings, bridges, water, architecture, cloudy sky, trees, grass, roads, vehicles, people, boats and objects.

India's Budget 2020-21: Boosting Agriculture, Rural Infrastructure Amid Economic Slowdown

India's economic growth has slowed, with real GDP growth plummeting to 5 per cent, the lowest in over a decade. Meanwhile, the Budget has been unveiled, focusing on boosting agriculture, rural infrastructure, and social sectors. It also aims to ease land-related issues and strengthen market linkages for farmers.

The Budget has set a target to digitise 1,00,000 gram panchayats by the end of the year, providing Fibre-to-the-Home connections. This move aims to enhance connectivity and facilitate access to digital services in rural areas.

In a significant announcement, the government has reiterated its intent to divest part of its stake in LIC and IDBI Bank. This follows an earlier announcement in 2020. The Budget also proposes the use of technology to tackle critical issues, such as geotagging infrastructure and employing AI in healthcare.

To boost the Indian market's appeal, the Budget introduces a taxpayers' charter and removes dividend distribution tax. However, consumer inflation has breached the RBI's 4 per cent threshold, indicating potential economic challenges ahead.

The Budget for 2020-21 adopts an expansionary fiscal policy, with the fiscal deficit target rising from 3.4 per cent to 3.8 per cent. It emphasizes health and education, providing viability gap funding for hospitals and medical colleges. The government's focus on agriculture, rural, and social infrastructure aims to drive inclusive growth despite the economic slowdown.

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