Budget 2018-19 proposes several measures, including promoting exports and supporting fixed tenure jobs, to create employment.
Giving a sense of urgency to the task of job creation in his fifth budget, finance minister Arun Jaitley’s proposals include enhancing infra spending; creating rural markets; giving tax sops to small industries; a special package for textiles; and a reduction in statutory employees provident fund contributions by new female employees.
Jaitley said creating and facilitating employment generation has been at the core of the government’s policy-making and indicated that it will keep focusing on labour intensive sectors including textiles, leather, micro and small and medium enterprises (MSME) to aid jobs growth.
“The government had approved a comprehensive textile sector package of Rs6,000 crore in 2016 to boost the apparel and made-up segments. I now propose to provide an outlay of Rs7,148 crore for the textile sector in 2018-19,” said Jaitley.
Calling it a “major engine of growth and employment” for India, he allocated Rs3,794 crore to the MSME sector as credit support, capital and interest subsidy and promotion of innovations.
“Massive formalisation of the businesses of MSMEs is taking place in the country after demonetisation and introduction of GST,” he said.
The budget also announced a reduction in the contribution that new women workers make to the employees provident fund, from 12% to 8%, to promote women’s participation in the labour force as well as increase their take-home pay. “To incentivise employment of more women in the formal sector and to enable higher take-home wages, I propose to make amendments in the Employees Provident Fund (EPF) and Miscellaneous Provisions Act, 1952, to reduce women employees’ contribution to 8% for the first three years of their employment against the existing rate of 12% or 10% with no change in employers’ contribution,” Jaitley said.