New Delhi | RBN News
Commenting on the Union Budget 2026–27, former President of Federation of Indian Chambers of Commerce and Industry (FICCI) Naina Lal Kidwai said she expects the government to remain committed to the fiscal consolidation roadmap, while allowing limited flexibility to support growth-oriented spending.
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Kidwai said the government should continue on the fiscal glide path, but emphasised that some leeway is necessary to sustain infrastructure investment, an area where public spending has delivered strong outcomes over the past decade.
She also highlighted the importance of maintaining demand and consumption in the economy, noting that recent GST reforms have helped support spending. According to her, continued liquidity infusion is essential to ensure that consumption momentum does not weaken.
“Unless demand moves up, private sector capital expenditure—which the government is keen to encourage—will not materialise,” Kidwai observed.
She pointed out that capacity utilisation levels, currently estimated at around 75 per cent or lower, remain a key constraint. In such a scenario, she said, expecting a sharp increase in private investment without first strengthening demand would be unrealistic.
Economic analysts note that Kidwai’s assessment reflects a widely held view within industry circles—that public capex and demand-side support remain critical triggers for crowding in private investment and sustaining long-term growth.
Her comments underline the broader debate surrounding Budget 2026–27: balancing fiscal discipline with the need for continued government-led investment to stimulate demand, infrastructure development, and private sector participation.
