India's economic pillars show 'no fragility', says Finance Minister Nirmala Sitharaman

Union Finance Minister Nirmala Sitharaman, on Monday, said India's key economic indicators showed no signs of fragility, citing strong GST collections and a sound banking sector, and urged citizens to speak with greater confidence about the country's economic growth.

Speaking at HSBC India's Third Annual Financial Inclusion Gathering, in a conversation with HSBC India CEO Hitendra Dave, she said even informed voices sometimes expressed scepticism about India's economic outlook.

"We will have to speak with a lot of confidence about India. That is my request," Sitharaman said.


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"Capex is a very important component of our growth strategy because till such a time the private sector is also going to come in to expand capacities or establish newer capacities. It's important for the government to push through with the capital expenditure," she said.

She said public investment would continue to support growth but stressed the need for responsible spending.

"We need to be fiscally prudent. Otherwise, it is not a gains thing," Sitharaman said. "Under Prime Minister Modi, fiscal prudence will be top priority," she added.

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On welfare spending, she said government schemes covering food security, housing, sanitation, drinking water and health insurance had improved access to basic services.

Citing a World Bank report, she said India's poverty level had fallen to 2% by the end of FY23 from around 25%, attributing the decline to welfare delivery, financial inclusion and access to essential services.

Sitharaman said credit, insurance and pensions would be key to the next phase of financial inclusion. She reiterated the government's target of providing insurance coverage to all by 2047 and stressed the need for easier access to credit for people looking to start or expand businesses.

On employment, she said the government wanted every district to have centres equipped to provide AI training. The aim is to prepare young people for AI-enabled jobs and bridge the gap between industry requirements and graduates' skills.

She also said a recently announced high-level committee would consult industry representatives and experts before recommending changes needed in the banking system to support the Viksit Bharat vision.

The government would have to balance fiscal discipline with the need to sustain public investment and support growth, she said.