Budget FY22: FM proposes to turbo-charge economy via mega spending push
New Delhi, February 1, 2021
Finance Minister Nirmala Sitharaman on Monday proposed to unleash a massive fiscal expansion in 2021-22 to revive India's pandemic-battered economy.
Accordingly, she proposed to increase the capital expenditure by 34 per cent in Budget 2021-22 in comparison to the previous fiscal BE (Budget Estimate). She presented the Budget in Parliament at 11 a.m.
The proposal will increase the capital outlay to Rs 5.54 lakh crore from Rs 4.12 lakh crore spending target in BE FY21.
Further, she proposed to institute a "Land Bank" monetisation company along with an asset management and reconstruction company or a "Bad Bank" and a Development Financial Institution (DFI) which will fund infrastructure projects.
Besides, agriculture, health and education sectors received a massive spending push.
On the other hand, to shore up the Centre's revenues, she proposed for an asset monetisation pipeline.
Furthermore, she proposed to provide Rs 20,000 crore for public sector bank re-capitalisation and make conducive environment for ushering in investments into FinTech, insurance and Start-ups.
In addition, the Centre plans to divest two public sector banks, as well as a general insurance company.
According to Sitharaman, the budget post the onset of Covid-19 pandemic has ample opportunities for growth and economic reset.
She said that, in the post-Covid world, India is well positioned to benefit from the new realignments in the economic and political spheres.
This is Sitharaman's third and most significant Budget presented to Parliament.