On the face of it, Budget 2019/20 does not have magnanimous steps to spur private investments that the Economic Survey underlined. But look deeper, and one can see a series of measured steps.
The government’s intent to reduce fiscal deficit from 3.4 per cent of GDP in FY19 to 3.3 per cent in FY20 and raise a part of its borrowings offshore, will help ‘de-crowd’ the bond market, lower interest rates, and therefore can invoke investments. Second, the ₹70,000 crore recapitalisation of public sector banks will help fuel credit growth. Third, the increase in customs duty is expected to aid local manufacturing and improve utilisation. The reduction in customs duty on inputs, on the other hand, will improve competitiveness in sectors such as petrochemicals, electronics, auto components, etc. Fourth, FDI…
