The Finance Minister presented a very growth-oriented and transformative budget which will not only strengthen the economic recovery currently underway, but also lay the foundation for bolstering the medium to long term growth potential of the economy. Indian industry welcomes the government’s unwavering commitment towards boosting investments, creating jobs, improving ease of doing business, maintaining tax stability and certainty in policy regime through well-designed and prudent measures delineated in the budget, highlighted Mr Chandrajit Banerjee, Director General, CII. With some success in implementation, we are confident that the growth projection made by the Economic Survey at 8.0-8.5% in 2022-23 will be met.
Focus on growth is essential for creation of jobs and for generating resources to be spent on health and education of the masses, and for social welfare measures. Higher growth is also important for ensuring debt sustainability and overall macro-economic stability, Mr Banerjee added.
We are happy to note that boosting investments was the leitmotif of the budget through enhanced public investments at both centre and support to state government capital expenditure. The massive 35.4% rise in capital spending budgeted for 2022-23 is in line with CII’s suggestion and lends credence to government’s vision of improving the economy’s growth potential through a push to overall productivity of the economy and creation of jobs, stated Mr Banerjee.
Even as a boost was given to investments, the FM did a fine balancing act of maintaining fiscal discipline by containing the fiscal deficit at 6.9% for the current fiscal and bringing it down along a steady glide path of 6.4% next year.
Conforming well to the ‘agile’ approach of using safety-nets for the vulnerable sections as outlined in the Economic Survey, the budget did well to announce a slew of measures to support the MSMEs sector, which has been hit badly due to the pandemic. The extension of the ECLGS upto March 2023 with an allocation of Rs 5 lakh crore to the tourism & hospitality sector is in-line with CII’s suggestion. An additional Rs 2 lakh crore have been allocated under the CGTMSE scheme for the MSMEs to meet their financing needs, which will go a long way to support revival of this sector that is pivotal local level jobs as well as livelihoods, commented Mr Banerjee.
CII is happy to note that the second pandemic budget came out with some landmark announcements which will go a long way in reviving growth by catalyzing demand and investments. The renewed focus on education and healthcare are big positives, which will spur a transformational shift in the quality of life of the large population.