Future-proofing the Indian economy: Measures announced in budget expected to stabilise rural economies

As the first finance minister in India's history to present seven consecutive Union budgets, finance minister Nirmala Sitharaman had the momentous task of addressing multiple areas such as rural demand, infrastructure development, manufacturing, technology upgradation, among others, to build levers for sustainable growth for the Indian economy-underpinned by an overall focus on boosting consumption and spending.

So, how did this budget fare?

With the nine priority areas identified today, the government has taken the vision they set out to achieve with the previous budgets a step further, by providing a balanced and strategic roadmap for a Viksit Bharat. This budget, with its clear focus on seeding resilience in agriculture, job creation, manufacturing, energy, sustainable and inclusive HRD, innovation, infrastructure development and tax reforms, emphasises the clear vision this government has on aiding the economy by driving inclusive growth and boosting consumption in the long term. This budget has taken a comprehensive and balanced approach, which can be seen in its move of retaining the capex budget.


Strengthening rural India
Having weathered the uncertainties of the past few years, there have been some promising signs of gradual demand recovery in rural markets, which continue to represent immense potential for further expansion. Therefore, it was extremely vital that this budget addresses critical aspects pertaining to rural development and the agricultural sector to provide further impetus to the rural economy.

The measures announced to enhance rural incomes via agricultural activities and provide more support to farmers, especially during the critical monsoon period, were also key focus areas addressed in the budget. These measures are expected to stabilise rural economies and drive consumption growth. With a better monsoon and increased minimum support prices (MSP) for crops, these steps can help drive healthy volume growth in rural markets in the medium term.

Long-term job creation
Notably, the announcement of the employment-linked schemes for new entrants into the workforce, along with the support loans of up to ₹10 lakh for higher education will ensure that the next generation of Indians are adequately skilled to enter the workforce. Further, the internship opportunities outlined with the top 500 corporates in India will benefit over 10 million Indian youth, an impressive initiative being undertaken by the government, which will ensure sustainable incomes and reasonable standards of living for consumers of tomorrow.

Boost For FMCG?
This budget takes cognisance of the prevalent pressures and has attempted to provide some much-needed relief to the FMCG segment through ambitious schemes and projects to jump-start rural growth. The budget proposals, if implemented effectively, could have significant positive impacts on the FMCG sector, as well as the larger Indian economy. Investments in infrastructure and digital initiatives would boost productivity and economic growth, setting the stage for a resilient recovery and long-term growth.

The author is MD & CEO, Marico