By Udaya Kumar Hebbar
Budget 2022 reinforces the government’s strong commitment to accelerate investments in reinvigorating the macroeconomic wheels of consumption and infrastructure. With the ‘inclusive development’ agenda, the capital expenditure push will be crucial for instilling confidence in the economic factors of production, aiding long-term employment opportunities for low-income households. Continued support to micro and small businesses along with rural livelihoods will further expand the scope for microfinance-backed income generation avenues.
The `7.5 trillion capital expenditure allocation will give a fillip through multiplier effect creating large-scale employment for youth. The Gati Shakti initiative, the national infrastructure plan, aims to drive growth and sustainable development across roads, railways, airports, ports, mass transport waterways, logistics, social infrastructure, and irrigation.
The Budget rightfully aims at strengthening the agriculture ecosystem, contributing nearly 18% of the GDP basket through modernisation & value-addition initiatives in farming. The Economic Survey reveals that 63% of the income of rural households came from non-farming sources in 2021, compared to 52% in 2014, as the households diversify across multiple livelihood supporting activities. The microfinance industry present across the hinterland and serving the same set of customers is a crucial link in promoting inclusiveness given the model resiliency has been testified time and again. To drive a meaningful impact, a host of measures have been taken, thereby creating better prospects for the sector serving the bottom of the economic pyramid.
An extension of the Emergency Credit Line Guarantee Scheme (ECLGS) till FY23 with guarantee coverage increasing by another
0.5 trillion, earmarked exclusively for the hospitality and related enterprises, will help revive micro and small enterprises. The PM Awas Yojana, an affordable housing scheme with an allocation of0.48 trillion, will significantly contribute to backward and forward linkages while the budgeted allocation for MNREGA, a safety net for rural wage earners remains firm at `0.73 trillion for FY23 compared to the previous year.
The Budget also takes cognisance of investing in quality education through its PM eVIDYA programme, wherein vocational courses will be offered with higher emphasis on digital learning in various languages through different mediums focusing on rural children. To meet the expanding digital needs of the country, it is imperative to enhance digital connectivity across India. The government aims to facilitate the rollout of 5G mobile services during FY23, to build a strong ecosystem and enable affordable broadband and mobile services in rural and remote areas. Further, enabling 1.5 lakh post offices for digital transaction inter-operability and supporting 75 district-level digital banking units will boost the rural digital economy.
All the benefits trickling to the bottom of the economic pyramid will touch the lives of families served by the microfinance industry. The sector guided by operational innovation and a consultative approach driven is steadily coming back with strong signs to contribute towards the next level or the capital creation story of Bharat.
(The author is MD & CEO at CreditAccess Grameen. Views are personal.)