Finance Minister Nirmala Sitharaman unveiled the budget for 2022, digitally, just like last year. As the nation is recovering from the aftermath of COVID-19, the newly- announced budget has been welcomed as a balanced and forwarding-looking step by the government.
As per the Indian government, the economy is expected to grow at more than nine per cent, which is a great sign and much better than many other economically powerful nations of the world.
“This budget also shows a major focus on skill development, where people can get access to formal education. It will also increase the availability of better talent in the market”
Dharm Rakshit, head-HR, Hero Motocorp
The major focus of the budget this time is on giving a boost to infrastructure development. In line with this objective, significant push has been given to the PM Gati Shakti plan, which was launched by the Government in October 2021, to build the infrastructure of roadways and railways, and improve connectivity.
The key highlights in terms of a push to infrastructure development in the country includes the expansion of national highways by 23,000 KM in 2023. Additionally, multimodal logistics park will also be developed at four locations. The ‘one station-one product’ concept will help local businesses and supply chains, while 400 new Vande Bharat trains will be introduced in the next three years. About 2,000 km of network will be brought under ‘Kavach’ for safety and capacity augmentation in FY23. Development of 100 cargo terminals over the next few years is also planned.
All these key announcements are certainly aimed at growing the economy and also creating more employment, even in the rural areas.
As per Dharm Rakshit, head-HR, Hero Motocorp, “the production-linked incentive scheme has received a major boost”. The scheme was announced to create manufacturing champions and jobs for the youth in India.
“Some relief in the tax slabs could have helped us introduce some tax-friendly components in the pay structure to benefit our employees”
Anil Gaur, CHRO, Akums Pharmaceuticals
“The infrastructure growth will create major job opportunities in the country. The budget looks quite promising and has been made with long-term growth in mind,” says Biswarup Goswami, CHRO, Gujarat Heavy Chemicals. The Government’s next target will be to create 60 lakh new jobs in the coming year.
One area where the budget disappointed majorly was in reforms or relief in the income tax slabs of salaried individuals. As the country is recovering from the aftermath of the pandemic, there is a clear indication of inflation in the market with fuel prices sky rocketing and other expenses also going up. The middle class salaried employees who were hoping that income tax slabs — which have not been revised since 2014 — will be reduced, were deeply dejected. “It is very disappointing to see that the Government has not changed anything in the tax slabs and standard deduction. Apart from that, the overall budget looks promising from a macro and micro perspective,” says P. Dwarakanath, former non-executive chairman, GSK.
“It is very disappointing to see no change in the tax slabs and standard deduction”
P. Dwarakanath, former non-executive chairman, GSK
“Unfortunately there was no change in the tax slabs,” rues Anil Gaur, CHRO, Akums Pharmaceuticals. Inflation is quite high and people have seen salary cuts and jobs getting slashed during the pandemic. “Some relief in the tax slabs could have helped us introduce some tax-friendly components in the pay structure to benefit our employees,” says Gaur. However, despite this disappointment, on a positive note, Gaur adds that they “have revisited our compensation and will bring some reformed benefits for our people”.
As part of the budget, the Government has also announced the launch of DESH e-Portal, a digital skilling and training platform for students. Sitharaman also announced the establishment of digital universities in collaboration with major institutes, which will work as per a hub and spoke model.
“The infrastructure growth will create major job opportunities in the country”
Biswarup Goswami, CHRO, Gujarat Heavy Chemicals
This will facilitate students’ skilling and reskilling in major areas, which will further make them employable. “This budget also shows a major focus on skill development, where people can get access to formal education. It will also increase the availability of better talent in the market and will help organisations to not just hire people but skilled talent who are fit for the job,” explains Rakshit.
“With this new budget, companies may have to relook at their employment model — whether they would want to hire skills or people. With skill-development plans in the pipeline, the gig economy will see a major boost with companies having to hire specialists on project basis,” adds Rakshit.
Paramjit Singh Nayyar, CHRO, Hero Housing Finance, is very positive about the Budget 2022. As per the new budget, 80 lakh houses will be completed in the year 2023 with an allocation of Rs 48,000 crore for the initiative, under the PM Awas Yojana. Some other key highlights Nayyar mentions are single-window environmental approvals, better coordination between the Centre and states for approval processes and uniform registration of deeds, which will boost the affordable housing sector.
“The housing industry will see a major boost through the newly announced budget leading to more jobs opportunities and growth”
Paramjit Singh Nayyar, CHRO, Hero Housing Finance
“When a major boost is expected in our sector, there is always hope for employment creation. Other than that, it is too early for me to predict how the budget will impact the overall HR strategy just yet. Things will unfold in the coming future,” says Nayyar.
On one hand, HR leaders are pleased that the Government has taken the right approach by coming out with a balanced and progressive budget, which will boost the economy and create more jobs. However, on the other hand, no change in tax slabs is a major setback and huge disappointment.