NEW DELHI: As the central government is struggling to strike a balance between growth and maintaining financial discipline, the union budget is unlikely to allocate money for “splurging” with officials stating that the net expenditure hike is expected to remain below 12 per cent.
According to the sources in the finance ministry, even as expectations are high from the Finance Minister Nirmala Sitharaman and industries seeking a higher stimulus in the budget this year, the government is vigilant on spending.
“This year’s budget is very challenging as at one hand there is Covid-19 and on the other hand, the government has to ensure that while they support growth, they are not deviating from the fiscal path, given that fiscal deficit is likely to be around 6.5-7 per cent. So, while the centre is in mood to spend, it will not splurge,” a top official from the finance ministry told this publication.
While the government will be generous with sectors that will require hand holding, it will not waste its resources on dead schemes or sectors which have not performed well in implementing its scheme, the official added.
“The sectors which are job centric will get support but ministry-wise spending will be strictly based on performance. It is a tough and challenging year so every department has to work in an efficient manner,” the official explained.
The finance minister had earlier said this year budget will be “as never before” to help India emerge as the engine for growth and economic resurgence. Apart from pharma and healthcare exports, the other sectors that are likely to get relief include textile, MSMEs and agri-based industries.
Special emphasis is likely to be on promoting foreign investment and in its pre-budget discussion, the PM had discussed the need for promoting foreign investment to boost growth.
However, the official maintained that some of the austerity drive which was initiated last year, will continue till the situation becomes normal in terms of fresh hiring, events, consultancy job and advertising budget of the ministries.
Spending on healthcare sector in India lowest
India’s spending on healthcare is the lowest among BRICS and OECD nations despite allocation of RS 69,000 crore towards the sector in Budget 2020-21.
Public spending on healthcare needs immediate attention.