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Budget 2023
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Budget 2022 | What the finance minister is doing ‘indirectly’ for consumption

Budget 2022 | Big-bang announcements to spur consumption were missing but a host of initiatives on creating employment opportunities as well as a 35 percent increase in capital expenditure would help in boosting demand in the long to medium term, say experts.

February 01, 2022 / 06:00 PM IST

The Budget 2022 is expected to revive consumption with its focus on infrastructure among others even though it lacks direct measures such as income tax rebates.

“The budget will boost consumption indirectly, rather than directly. The announcements made under PM Awas Yojana and the ones to boost agriculture and rural economy will help in bringing back consumption, which has been declining in the last two years,” said Abheek Singhi, managing director and senior partner, BCG.

According to Economic Survey 2022, released on January 31, private consumption declined to 57.5 percent of GDP in FY22, down from 58.6 percent in FY21. Consumer goods companies, industry experts and economists, hence, were expecting measures to revive consumption.

An increase in capital expenditure will also help the economy, indicated analysts.