Budget’s push on urban & rural growth will help boost rural consumption: Mohit Malhotra

Turning attention to the full year and beyond, the Union Budget for 2024-25 particularly focuses on employment, skilling, MSMEs, and the middle class. In line with the strategy set out in the interim budget, this budget envisages sustained efforts on the following 9 priorities for generating ample opportunities for all:

1. Productivity and resilience in Agriculture
2. Employment & Skilling
3. Inclusive Human Resource Development and Social Justice
4. Manufacturing & Services
5. Urban Development
6. Energy Security
7. Infrastructure
8. Innovation, Research & Development
9. Next Generation Reforms

This year, the Finance Minister has made a provision of Rs 2.66 lakh crore for rural development, including rural infrastructure.

Reacting to the Budget provisions, Mohit Malhotra, Chief Executive Officer, Dabur India Limited, said, “The standout feature of the Union Budget 2024-25 is its focus on speeding up fiscal consolidation with the Fiscal Deficit being revised down 20 bps from the Interim Budget to 4.9%. While Finance Minister Nirmala Sitharaman has rolled out a string of measures for job creation, rural development, women empowerment and infrastructure investment, the announcement on Capital Gains tax seems to have come as a big dampener for the market.”

According to Malhotra, increased allocation in the budget towards Education, Skilling and Employment and special employment-linked incentive schemes for employees and employers aptly demonstrate the government mindset to significantly improve employment and employability in the country. “These steps will go a long way in driving consumerism. The support for higher education loans and the push for women in the workforce are other big pluses,” he added.

The government has increased standard deductions from Rs 50,000 to Rs 75,000, revised tax rates under New Tax Regime and slab revisions would result in savings of around Rs 17,500 in net taxes in the hands of individual. This would mean more disposable income in the hands of the consumers and would lead to sustained demand for branded consumer goods.

Malhotra further said, “The Budget’s push on urban and rural growth will help boost rural consumption and also increase discretionary spending. Urban Housing needs of 1 crore urban poor and middle-class families are being addressed with an investment of Rs 10 lakh crore. The government’s decision to allocate Rs 2.66 lakh crore for rural development, including rural infrastructure, and its continued focus on rural infrastructure development are big steps in the right direction. These measures would further boost consumer sentiments in the hinterland, which is already showing green shoots of revival.”

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