The substantial increase in capital expenditure to Rs 7.50 lakh crore as announced by Finance Minister Nirmala Sitharaman is clearly the highlight of the Union Budget and this bodes well for sustaining the economic activity and job creation in the medium term, a top official of Sundaram Finance said on Tuesday.
The support extended to the micro, small and medium enterprises sector, especially hospitality, through an extension of the Emergency Credit Line Guarantee Scheme (ECLGS) till March 2023 would help recover MSMEs from the fallout of the pandemic, Sundaram Finance Managing Director Rajiv Lochan said.
“The government has done its part on investments and thrown down the gauntlet to the private sector to make its contribution to investments”, he said, adding that all these initiatives make it a “progressive budget” for the medium term.
He noted that the GDP growth indicated in the Economic Survey of 8-8.5 per cent and inflation in the 4-6 per cent, would suggest a nominal GDP growth north of 12-13 per cent. “The projected 6.4 per cent fiscal deficit for FY2023 is certainly on the glide path to a sub 4.5 per cent fiscal deficit in FY26 as announced last year but came up as higher than the consensus 6.1 per cent expectations,” he said.
The budget is “progressive” from a medium-term standpoint and “conservative” for a near-term standpoint, he said.
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