We Never Considered Imposing A Cess

Hours after presenting her third Budget, finance minister Nirmala Sitharaman tells TOI’s Sidhartha & Surojit Gupta that the government prioritised investment to boost demand and create jobs as a durable strategy.

- Sidhartha & Surojit Gupta

Q. What is the overall philosophy of this Budget? Will economic activity return to pre-Covid levels by the end of the year?

From the third quarter, the government has been pushing capital expenditure. You saw the drastic jump and, with that, we clearly feel that the (economic) rebound is being helped. Therefore, it was clear during consultations that a good amount of public spending, particularly on infrastructure, is one recipe where the multiplier effect is big. And because of the multiplier, the result that you expect is sure shot.

Besides, when you do this instead of delivering money into people’s hands, the quality of expenditure can be monitored. That may be good short and medium-term, but not in the long term. That is why we have taken this call. Everybody said fiscal deficit this year will be 7-7.5%. Look where we have arrived.

We did not hesitate to spend (this year) and did not hesitate to spend on quality projects. We will continue with that. We have announced almost Rs 5.5 lakh crore for capital spending. I have also listed projects where the money is going to be spent. It’s not as if I have declared the amount and didn’t know where to spend it -- whether it is power generation, discom improvement, ports and harbours, or roads and railways.

Even during Covid, nearly 217 projects, which were listed in the National Infrastructure Pipeline, have been completed. Records show that we can complete projects. Therefore, the amount that we have declared now is likely to be spent and the multiplier effect will get the economy going back to where it should be after the contraction.