Budget 2021: Centre bets on multiplier effect of infrastructure projects to create jobs, boost demand
The problem with the emphasis on large infrastructure projects is that implementation can be delayed due to a variety of reasons including land acquisitions and environmental clearances. February 01, 2021 / 08:24 PM IST
The Budget will deliver growth, create jobs, restore incomes and boost consumption. But more likely over a medium-term rather than in the immediate few months. This is because the focus is on infrastructure building and construction, which takes time to deliver results.
Many of the projects announced by Finance Minister Nirmala Sitharaman will be built over a period of over five years, create durable assets and deliver growth in the medium term rather than provide a short-term boost. The government is betting on the fiscal multiplier effect of infrastructure projects – estimated at 2.5x – to achieve its objective.