Infrastructure push key to economic revival: Afaq Hussain

Experts from various industries have given their reactions to the budget presented by Finance Minister Nirmala Sitharaman in Parliament today. Opoyi talked to Afaq Hussain, Director, Bureau of Research on Industry and Economic Fundamentals (BRIEF), on the Union budget.

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The budget has some touch of election-centric announcements in the form of agricultural announcements such as MSP and other reforms in the agricultural sector, including the scheme for the northeast region, said Hussain.

He added that there are some big announcements to push the infrastructure sector. The government is focusing on the logistics sector, which is very important for the economy and CAPEX, which is increased by 35% to Rs 7.5 lakh crore in this budget.

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Hussain said that relief for the common man in the form of tax restructuring was missing in today’s budget. Given the pandemic over the last two years, it is important to give more cash in the hands of the people so that we can induce some demand for the revival of the economy. There should have been some announcement on the tax components for individuals as well as corporations, he added.

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While speaking on cryptocurrencies he said the 30% tax on digital assets is a sign that we are trying to accept cryptocurrencies. It has been in discussion for the past few months and it is good that we have some clarity on this.

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On the agriculture sector, he said, the announcements can be linked to Punjab and Uttar Pradesh polls. The direct MSP transfer should result in enhanced cash with farmers assuming there is a removal of middlemen. Other technologies in the farming sector such as spraying of insecticides and crop assessments will surely help in the long run. He added that MSP was the key point during the farmer protests.

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Hussain said there is always some linkage between the Sensex and budget. The government has been giving impetus to infrastructure and realty firms for a while now.

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PM Gati Shakti was announced a few months ago and giant projects are going to come up such as multi-modal logistics parks, highways and cargo terminals. A lot of money will be invested in this sector on both by the government and by the private sector. It is definitely going to push realty stocks.

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The finance minister started with Gati Shakti, which is all about logistics and infrastructure. Realty stocks will benefit from these budget announcements, Hussain said.