NEW DELHI – India’s ruling party has urged the government to put more money in the pockets of middle-income families in the next budget and cut raw material costs for small and medium-sized businesses, a party spokesman said Thursday

After the effects of the coronavirus have shrunk the economy for the past two quarters, Prime Minister Narendra Modi’s government plans to increase spending on road, port and pipeline projects in the next fiscal year to revive businesses and create jobs

Modi’s Bharatiya Janata Party (BJP) believes that while the poor receive free rations and businesses receive government-guaranteed loans and other concessions, the economy will benefit from increasing the tax burden for the middle class with more generous standard deductions lower

“The middle income group has big problems and needs support,” said Gopal Krishna Agarwal, who is responsible for communication and coordination of the BJP on economic affairs

“Incentivizing consumption through them would also help the industry,” Agarwal told Reuters days after meeting the finance minister to discuss party members’ budget proposals. “I can say the budget will take care of the middle class ”

The government counts more than 300 million of India’s population of 135 billion among middle class consumers

Treasury Department spokesman Rajesh Malhotra said no ministerial official would comment on the budget for the new fiscal year, which starts in April until the document is published in Parliament in February 1

Another proposal is to increase write-downs on items such as cars, machinery and durable goods such as refrigerators to increase consumption and decrease corporate tax expenditures, Agarwal added

For medium and small businesses, the government could also try to lower import duties on some raw materials such as copper and base metals

“Raw material costs are rising not because of demand but because of supply shortages for the consumer industry, and they are calling for some relief,” Agarwal

said

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World News – CA – India’s ruling party is pushing for budget relief for middle class, post-virus corporations

Source: https://financialpost.com/pmn/business-pmn/indias-ruling-party-pushes-budget-relief-for-middle-class-business-in-wake-of-virus