Union Budget 2022: Rising capital spending bodes well for economic activity and job creation, says Sundaram Finance
Supporting MSMEs through an extension of the ECLGS until March 2023 would help recover from the fallout of the pandemic, Chief Executive Rajiv Lochan said.
The substantial increase in capital expenditure to Rs 7.50 lakh crore announced by Finance Minister Nirmala Sitharaman is clearly the highlight of the Union budget and it bodes well for supporting economic activity and job creation in the medium term, said a senior Sundaram Finance official. Tuesday.
Support to the micro, small and medium enterprise sector, particularly hospitality, through an extension of the Emergency Line of Credit Guarantee (ECLGS) program until March 2023 would help recover MSMEs from the fallout from the the pandemic, said Rajiv Lochan, managing director of Sundaram Finance. .
“The government has done its part on investments and thrown the gauntlet to the private sector to contribute to investments,” he said, adding that all these initiatives make it a “progressive budget” in the medium term. .
He noted that GDP growth indicated in the economic study of 8 to 8.5 percent and inflation in the 4 to 6 percent range would suggest nominal GDP growth north of 12 to 13 percent. “The projected fiscal deficit of 6.4% for FY2023 is certainly on track to a lower fiscal deficit of 4.5% for FY26, as announced last year, but it is higher than expected. consensus of 6.1%,” he said.
The budget is “incremental” in the medium term and “conservative” in the short term, he said.
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