International Business: UPDATE: India targets infrastructure spending in growth budget – Gulf Digital News

International Business: UPDATE: India targets infrastructure spending in growth budget – Gulf Digital News

NEW DELHI: India unveiled a bigger budget of 39.45 trillion rupee ($529.7 billion) for the coming fiscal year on Tuesday, stepping up investment on highways to affordable housing to put growth on a firmer footing as the economy recovers from the pandemic.

The government has projected slower economic growth of 8% to 8.5% compared with an estimated 9.2% for the current fiscal year. GDP contracted 6.6% the previous year.

"The overall sharp rebound and recovery of the economy is reflective of our country's strong resilience," Finance Minister Nirmala Sitharaman said, vowing to lay the foundation for faster growth.

She announced spending of 200 billion rupees ($2.68 billion) for a highway expansion programme and said 400 new trains would be manufactured over the next three years. Total government spending will be 4.6% more than the current year.

The fiscal deficit for the current year would be 6.9% of GDP, slightly more than the 6.8% targeted earlier, Sitharaman said.

For the next fiscal year, India is targeting a deficit of 6.4% of GDP, hoping to build on higher tax revenues and privatisation of state firms including a share sale of giant insurer Life Insurance Corporation.

Prime Minister Narendra Modi's government has made building of physical and digital