Growth Oriented Budget which promotes manufacturing led growth

Mr. Rajesh Agarwal, CMD, BS Ltd

"Budget looks good with a long term vision of the government. This is the growth oriented budget which promotes manufacturing led growth, infrastructure and clean energy which the country needs.

Acknowledging that the present infrastructure does not match our growth ambitions and a pressing need to increase public investment with a sizeable increase of 70,000 crores in infra sector is a huge welcome for infra players.

The reformist shift in announcing slew of policy initiatives to promote manufacturing, clean energy provides a visible roadmap for growth of infrastructure and will accelerate infrastructure development.

Even though several schemes were announced in last year's budget for strengthening the power transmission and distribution sector, these failed to attract substantial investment.

Matching the anticipated demand of 800,000 MW in next 15 years cannot be achieved by public sector along and requires active participation of private and PPP players. The budget has adequately focused on restoring investor confidence wherein in the last three years not a single new power project has been taken up by the private sector and with announcement of 5 more UMPP with 1 lakh cr investments, it is bound to attract the confidence of investors. implementation of GST will help in ease of doing business.

While the budget focused on 24*7 power supply and electrification of 20,000 remaining villages, it is unclear on boosting transmission & distribution capacities which are major impediments. Last year alone, around 6000 million units of electricity could not be cleared by country's exchange reserves due to lack of transmission network amounting to 16% of capacity which could have been available.

The Budget has adequately focused on the renewable energy sector with revision of its targets 1,75,000 MW till 2022, comprising 100,000 MW Solar, 60,000 MW Wind, 10,000 MW Biomass and 5000 MW Small Hydro. Establishment of NIIF National Investment and Infrastructure Fund with annual flow of 20,000 crores to support infrastructure development is seen as a welcome move."

Source : Equity Bulls

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