Manufacturing and construction sectors will drive growth, putting India on track to become the fastest growing country among large nations, the Monthly Economic Review of the Union finance ministry has said.
Referring to various initiatives in the Union Budget 2022-23, the state-backed review said the Centre’s Production Linked Incentive (PLI) schemes and public spending in capital infrastructure will be “growth drivers”.
“In a testimony to the resilience of its people and the farsightedness of its policymaking, the Indian economy that contracted by (-)6.6% in 2020-21 is now projected in 2022-23 to grow the quickest among the league of large nations,” the review said.
The review, citing data from the International Monetary Fund (IMF), said that India is “yet the only large and major nation listed by the IMF whose growth projection has been revised upwards in 2022-23”, even though the fund had lowered global growth forecast in January 2022.
The review said agriculture and the rural sectors continued to be resilient. The farm sector will be benefited by crop diversification, larger acreages and generous procurement at minimum support prices, aside from cash transfers through PM-KISAN scheme, the review stated.
Projected capex spending, up 35.4% over the current year’s budget estimates to touch 4.1% of GDP, will power the “seven engines of Gatishakti” to spruce up infrastructure and facilitate private investment in the country, the report said.
{{/usCountry}}Projected capex spending, up 35.4% over the current year’s budget estimates to touch 4.1% of GDP, will power the “seven engines of Gatishakti” to spruce up infrastructure and facilitate private investment in the country, the report said.
{{/usCountry}}‘Gatishakti’ is the government’s integrated plan to build a network of connected multimodal logistics infrastructure, such as ports, highways, cargo terminals and airports. The budget targets ₹7.5 lakh crore of capex spending in FY23. This includes ₹1 lakh crore in long-term interest-free loans to states for capital works.
The Opposition has criticized the budget for slashing social-sector subsidies.