New Delhi: Union Finance Minister Nirmala Sitharaman said the Indian economy will continue to be the world’s fastest-growing economy backed by the increase in the government’s capital expenditure in the Budget for 2025-26 and rising consumption levels, especially in the rural areas.
In her reply to the Union Budget debate in the Lok Sabha, the Finance Minister said that the effective capital expenditure works out to 4.3 per cent of the GDP in the Budget for 2025-26 while the fiscal deficit is 4.4 per cent.
“This indicates that the government is using the entire borrowed resources for financing effective capital expenditure, creating capital assets,” she pointed out.
She cited figures from the Budget to show that the capex allocation in the budget has increased to Rs 1.21 lakh crore, dismissing the opposition’s claim that the outlay has been reduced.
The Finance Minister also said that inflation management is the highest priority of this government and overall retail inflation is within the notified tolerance band of 2 per cent to 6 per cent. She added that food inflation which was impacted by adverse weather conditions has all been attended to, and the government is continuing to do it.
Taking a dig at the Congress, she remarked, "Double-digit inflation rates under the earlier UPA regime is a thing of the past now." FM Sitharaman pointed out that food inflation reached a staggering 11 per cent during the second term of the UPA-led government, causing serious hardship for the public.
Focus on supply chain improvement and agricultural progress helped the NDA government bring food inflation down to 5.3 per cent from 2014 to 2024, she said. FM Sitharaman highlighted that the government is undertaking steps like monitoring groundwater levels so that there is no problem with the irrigation of either Rabi and Kharif crops, thus, keeping food inflation in check.
In this context, she also highlighted that the government had infused more capital to strengthen the FCI which procures agricultural goods from farmers at the MSP. FM Sitharaman also said that the unemployment rate has declined from 6 per cent in 2017-18 to 3.2 per cent in 2023-24.
