Budget where the government has continued its focus on infrastructure and rural demand - Sidharth Rath - SBM Bank (India)
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By Sidharth Rath - Managing Director & Chief Executive, SBM Bank (India)
A growth supportive budget where the government has continued its focus on infrastructure and rural demand. The focus is on driving capital expenditure to drive growth, with an intent of crowding in private investment through higher public spending. Further, the budget has given the major emphasis on information technology as the prime mover for the growth in areas such as agriculture, health (tele mental health centers), education (network of television channels and internet to create local language content) and proposed initiative on digital rupee. The move of connecting post offices to core banking system is a welcome step towards the financial inclusion.
Fiscal deficit of 6.4% of GDP for FY 2023 hints at government intent on undertaking Fiscal Consolidation in a steady and progressive manner avoiding any aggression at this nascent stage of recovery. The move towards self-reliance through the protection of domestic manufacturers, changes in custom and import duties is a big positive. The extension of the Emergency Credit Line Guarantee Scheme (ECLG) up to March 2023 will provide support for lending to the MSME sector. Simultaneously, the revamp of Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTSME) will be an added incentive for banks to extend lending. The goal is complementing macro-growth with micro-all-inclusive welfare, digital economy and fintech, tech-enabled development, energy transition and climate action."
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