Rural roads, rural electricity and irrigation will be priority, says Feedback Ventures
Forget some big push to urban infrastructure in the upcoming Union Budget, finance minister Arun Jaitley is likely to put on his Bharat cap announcing a slew of projects in creating capacities to reduce woes in the rural areas.
While pent-up demand for infrastructure continues to remain a key trigger to kick-start investment cycle in the economy, it is rural areas that the government would be concentrating more on February 29.
"This Budget would be for the rural infrastructure, be it rural roads, rural electricity and irrigation," said Vinayak Chatterjee, chairman, Feedback Infrastructure Services, a key voice in the infra space.
Agriculture sector has suffered heavily because of two consecutive droughts, slow rise in support prices, and the government's confusion over the direction the employment guarantee scheme would take, all leading to strain on rural income, economy experts have expressed in recent times.
"Farming is really down with low productivity and farmers in distress. With such a background, I understand the government would try to show this time that it is bothered not only with infrastructure and public spending but also about the distressed farmers," Chatterjee told dna on the sidelines of a conference on infrastructure organised by CII.
The finance minister, in fact, has been dropping hints of the rural push in the ensuing Union Budget.
"Our priority will be to enhance public expenditure in infrastructure, social infrastructure, enhance expenditure on the rural sector," Jaitley had earlier said at a meeting in Kolkata.
Muted growth of rural wages was highlighted in Reserve Bank of India governor Raghuram Rajan's recent sixth bi-monthly policy monetary policy.
And during a recent pre-Budget meeting with state counterparts, Jaitley was told in no uncertain terms that there should be sharper focus on agriculture, which has suffered in the last two years due to inadequate monsoon.
All these, Chatterjee believes, would now force the government to direct its attention towards the rural sector.
"It's essentially projecting a pro-farm image," he said.
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