How much success will Finance Minister's efforts to create demand?
Finance minister Nirmala Sitharaman has tried a lot to push India's faltering economy out of the slowdown and onto the highway of growth. People's income up to Rs 12 lakh has been made tax free, so that the money saved from this can be spent with both hands for daily needs and demand in the market increases. To increase the income of rural india with a population of 80 crore, it has been announced to spend Rs 1 lakh 71 thousand crore on agriculture and its allied sector, so that the rural consumer market can grow due to increased income in the village and this can give a booster dose to the market and then the economy.
How ready is the urban middle class?
The government of india has taken measures at its level to create demand in the market by increasing consumption, but to reach the destination of this goal, how ready is the urban middle class, which is becoming the growth engine, for this. It may also happen that the government has given income tax exemption on income up to 12 lakhs to increase consumption and the urban middle class starts spending it on buying assets. In such a situation, it will be difficult for the consumer market to grow as expected.
FMCG, retail and lifestyle have special hopes
The entire focus of the government's exercise is on boosting the disposable income of the people. That is, people can spend more and more on things that are bought repeatedly. For this reason, FMCG, retail and lifestyle sectors have high hopes from this move of the government of India. Companies hope that this will accelerate their sales growth, but this hope can also turn into disappointment if there is a surge in asset purchases. Strategists of companies are also afraid of this. They can soon convey this apprehension to the government, and can also request for initiative towards its solution.
