FM: Govt will continue to invest in infra
- Government spending on public infrastructure such as roads, bridges and ports will not only provide contracts to private parties and generate jobs, but will also likely have a lasting impact on the economy by raising productivity and efficiency
The government will continue to spend on building infrastructure to ensure a sustainable economic revival, finance minister Nirmala Sitharaman said on Tuesday.
“I shall do everything that it takes to make sure the budget will have these inputs,” Sitharaman said at the Assocham foundation week.
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Government spending on public infrastructure such as roads, bridges and ports will not only provide contracts to private parties and generate jobs, but will also likely have a lasting impact on the economy by raising productivity and efficiency.
In a pre-budget meeting with the finance minister on Monday, top industrialists called for a fresh round of fiscal stimulus to support growth. They also urged the Centre to help boost private investments and create jobs, while prioritizing expenditure on healthcare and infrastructure.
Sitharaman, who is scheduled to present her third budget on 1 February, said the government raised its borrowing to ensure spending in critical areas remains unaffected.
“As of 20 November, ₹9.05 trillion has been borrowed from the market, so that expenditure does not suffer. That is 68% more than last year. Recognizing that this is an unusual year, our borrowing has been kept at levels at which we can put the money back in projects, capital expenditure so that the money goes back to the ground,” Sitharaman said, adding she has been meeting secretaries of other departments and top executives of state-run firms to ensure the pace of spending is unaffected by the pandemic.
The National Infrastructure Investment Fund is in talks with sovereign funds that have shown interest in investing in infrastructure projects in India.
After a slow start due to covid-19, Sitharaman expects the Centre’s asset sales programme to pick up pace, generating much-needed resources to fund spending on infrastructure and health. “The pace of disinvestment will now gain a lot of momentum. Those that have got cabinet approval will be taken up in all earnestness,” she said.
The government had set a disinvestment target of ₹2.1 trillion for this fiscal. So far, it has garnered ₹6,734 crore through minority stake sales and the initial public offering of Mazagon Dock Shipbuilders Ltd.