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By Sandeep Upadhyay, Managing Director – Centrum Capital Ltd

The Budget seems to be focused on high impact areas and accelerating the capital expenditure cycle. Setting Capital Expenditure target of Rs. 7.5 Lac Crores, increase of 35% vis-a-vis FY22 is a major shot in the arm for the Infrastructure sector and certainly much higher than market estimates. It is pertinent to note the reference towards investments into capacity building initiatives within the Infrastructure sector for much needed skill upgradation pertaining to Project Appraisal, Planning, Design and Project management including Technical and knowledge assistance coming from multilateral funding agencies. This certainly suggests reorientation of focus towards much needed planning, monitoring and supervision of the massive investments being planned and not just splurging towards unleashing the Capital Expenditure cycle.        

Key beneficiaries are stakeholders in the Transportation and Logistics sector, where in Rs. 25,000 Crs is planned to be invested in FY23 in road sector along with further strengthening the ecosystem for Expressways. 100 new Cargo terminals to be built in next 3 years and manufacturing new generation 400 Vande Bharat trains with improved energy efficiency is a major push towards catalyzing manufacturing sector through robust demand being generated from the Infrastructure space.

Reinforcing the need for Innovative financing and rebooting PPP model, FM’s speech suggested focus in the right areas. Launch of National Bank for Infrastructure development, capitalization of NIIF and raising Green Bonds to pursue thematic investments including Energy Transition, Climate change and carbon footprint apart from funding conventional public infrastructure projects could continue to playing a critical role in meeting the ambitious targets set as per the National Monetisation Plan and National Infrastructure Plan. IRDAI coming up with a new framework for Surety Bonds could be another game changer however one will have to wait to go through the fine prints and its application.

Overhauling the SEZ policy and improvising the NCLT framework were also covered during the budget speech and could have a major bearing on the core sectors. It was also refreshing to hear about the additional allocation of Rs. 19,500 Crores towards PLI scheme to promote the highly potential solar cell and module manufacturing ecosystem in India. New policy towards strengthening Battery swapping system and PLI scheme to encourage Battery manufacturing domestically is a clear indication to move with a cleantech approach towards enhancing public transport going forward.