“Two major worries are inflation and unemployment. In such circumstances, spending on infrastructure has been the priority and allocations are higher but actual spending on the ground is yet to be what it should be,” says Rajnish Kumar, Former CMD, SBI.

The public sector bank network becomes the fulcrum and the funnel for distributing government schemes. Do you think there will be a lot of focus on the rural economy and the agricultural sector? Remember, 2022 was the year when the government promised farm incomes will double. How do you see this panning out?

But the farmers’ income, despite all the efforts, has not increased to the desired level. So anything which the government does to improve the income of the farmers would obviously be a welcome step. But despite the good revenues, there is always a huge pressure on the government finances. So it is always a difficult balancing act for the government and that difficulty is not new this year.
The fiscal deficit seems to be what in the current Covid circumstances would be an acceptable figure, otherwise 6.8?ficit is not an acceptable figure but in current circumstances, globally this has become a norm and fiscal deficit has gone to the lower in the priority and more is on how the government spends money, how the expenditure is increased, how the demand gets created and there are supply side constraints as well. So how do the fiscal measures get tackled? These are major issues which would be part of the Budget making process.

Divestment is always a very complex process but the Air India disinvestment was a very big issue but that has been achieved. There is a lot of work going on for the LIC IPO. Other than that, by March 31, I do not foresee a situation where there will be any other major action or the transactions can be concluded if the government is able to do LIC IPO. That itself will be a big achievement.
But other than that, everything will go to the next fiscal and the government is very clear about where they are looking to sell and the government’s exit plan is very much there. It was announced last year. Implementing it on the ground is always a challenge and the bigger the transaction, the more complex it is

As far as the Indian economy is concerned, currently because of the US Fed action, there has been some outflow of the money but because the foreign investors believe in the India story and this is one market where you have the growth potential, the demographics will favour the country. We are still one of the youngest countries and the per capita income is just $2,000 per person.

The infrastructure requirement is Rs 100 trillion. We need to spend Rs 20 trillion every year but I do not think that kind of investment is happening. So whatever we want to do, there is a huge scope but the execution always is an issue. In the case of disinvestment, a lot of issues always crop up but disinvesting Air India and LIC this year itself would be a great achievement.