A Pragmatic And Growth-Oriented Budget
The India Commentary view
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By Our Editorial Team
First publised on 2022-02-02 06:34:04
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The India Commentary view
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The 2022 Budget presented by Finance Minister Nirmala Sitharaman should be hailed for many reasons, not the least being the conscious attempt to steer clear of populism and focus on growth. With elections due in five states, including the most crucial one in UP, there were chances that the government would use Budget sops to lure the electorate giving a go by to economic sense. In not doing so, the Budget has showed that the economy is more important than narrow electoral considerations.
There are two ways to put money in the hands of the people. The first way is to give it to them directly by way of bank transfer. The other way is to give the economy a huge boost through increased government spending on infrastructure projects that brings business for big and small companies and increases job opportunities and salaries, thereby putting money in the hands of the people. The Budget this year has rightly adopted the second route as it is the route which builds the economy and does not make people dependent on doles.
The 35% increase in capex and the promise to invest in infrastructure - highways, roads, low-cost housing, among others - will provide orders for core industries like steel, cement and building materials. The chain effect will kick start the economy and increase job opportunities. The extension of the loan guarantee scheme for MSMEs for one more year and further infusion of Rs 50000cr for the hospitality sector are good measures as this sector was the worst affected due to Covid. This measure will also contribute to creation of jobs as there were huge job losses in the MSME sector and it is the one that creates the most jobs.
If there are no further Covid shocks, this Budget is designed to take the economy to greater heights. Although allocations towards food subsidy and MGNREGA have been lowered substantially, the option to intervene in case of any distress through out-of-Budget spending is always available to the government. The push for digitization is also good as the rollout of 5G in the next FY will create a foundation for next-gen technologies and India cannot afford to be left behind.
Image courtesy: sansad tv
