Reforms, inflation-targeting and job creation were some of the key recommendations that figured prominently in Finance Minister Nirmala Sitharaman’s first pre-Budget consultations with leading economists in connection with the forthcoming General Budget 2024-25, sources told the Daily Guardian. The meeting was also attended by Finance Secretary, secretaries of Departments of Economic Affairs, Revenue, Financial Services and Corporate Affairs; and Chief Economic Adviser.
Nagesh Kumar, economist and Director, Institute for Studies in Industrial Development (ISID), told the Daily Guardian that there was a lot of emphasis on the manufacturing sector and job creation. “On the way ahead for realising that objective, within manufacturing, I highlighted labour intensive sectors and the importance of extending the production linked incentive to cover these sectors. I also spoke of creating a new architecture for long term lending and strengthening consumption growth since sustainability of growth would be affected by the fact that consumption growth has been slow,” Kumar said.
Among the other proposals at the meeting was the need to enhance innovation in India and that the large corpus of Rs 1 lakh crore for innovation announced in the Interim Budget should be operationalised very quickly. Health and education also found mention in the discussions with stress on doing more in these areas.’
Kumar also underlined the need for exchange rate management to be very competitive — that India has maintained – otherwise, as he points out, it can erode whatever the Government is doing by way of giving some cushion to domestic industry.
In the context of the Indian economy holding out strong prospects of growth and resilience, the Budget in July is expected to provide greater clarity on its economic reform priorities and fiscal plans over the coming five years as well as lay down an economic agenda that supports sustained momentum in manufacturing and services activity, revival in private consumption, keeping investment activity on track, thrust on infrastructure spending, optimism in business sentiments.
