Nirmala Sitharaman Press Conference Highlights: FM Says Stimulus Schemes To Boost Demand By Rs 73,000 Crore
Watch: Finance Minister Nirmala Sitharaman Announces Schemes To Boost Demand
Experts React To FM's New Stimulus Measures
Devendra Pant, Chief Economist, India Ratings
- The demand stimulus announced, if realised fully, is unlikely to bring a major change in the economy to boost demand.
For states, The announcements are unlikely to spur capex but the states could use the funds on existing projects and to settle pending bills.
Radhika Rao, Economist, DBS Bank
- Today’s announcements carry a prudent intent to boost consumption, whilst also being spending-lite so not to put additional burden on the exchequer.
- In addition to government employees, the boost to demand can be more material if the private sector also takes cue and mirrors some of the benefits announced by the Finance Ministry.
Sameer Narang, Chief Economist, Bank of Baroda
- The amount of the stimulus remains low but the announcements are nevertheless a step in the right direction and will bring some benefits.
- The announcements for government employees will lead to front loading of some of the expenditure and will translate into some spending.
Rajni Thakur, Economist, RBL Bank
- While the markets are more concerned about where the money comes from, today’s announcements are unlikely to impact the central governments balance sheets by much.
- The stimulus is too small and unlikely to have an impact of spending but funding for states could push some projects into the pipelines.
It will have an impact on those who are desperately looking for demand to keep their businesses afloat.Nirmala Sitharaman, Finance Minister
Finance Ministry Estimates Total Demand Boost at Rs 73,000 Crore
- The Finance Ministry expects additional demand boost of Rs 36,000 crore -- Rs 28,000 from LTC voucher scheme and Rs 8,000 from festival advance scheme.
- It also expects Rs 37,000 crore additional central and state capital expenditure.
Total boost to demand estimated at Rs 73,000 crore, all to be spent by March 31, Sitharaman said.
Additional Rs 25,000 Crore Allotted To Capital Expenditure Budget
- Rs 25,000 crore of capital expenditure budget to be provided over an above the Rs 4.13 lakh crore allotted in the annual budget.
- To be spent on roads, defence infrastructure, water supply, urban development, defence infrastructure and domestically produced capital equipment.
- Allocations will be made int he forthcoming revised estimate discussions of Ministry of Finance with concerned ministries.