Budget needs to take steps to address lower than expected growth in consumption: Godrej & Boyce CEO

New Delhi: The government needs to take steps such as reviewing personal income tax slabs in the upcoming Union Budget to drive private consumption, which in turn will drive private investment, Godrej & Boyce Executive Director & CEO, Anil G Verma said on Thursday.

He also expressed optimism that the government will build upon the solid foundation laid by the interim budget, which focused on boosting infrastructure development, maintaining fiscal prudence, and laid progressive emphasis on women, youth, farmers, and the underprivileged through skilling, welfare measures and financial assistance.

"The important area that needs to be addressed now, amongst others, is the continued lower-than-expected growth in private consumption," Verma said in a statement.

Asserting that private consumption drives private investment, he said, "Therefore, I am hopeful that the GoI (government of India) will take steps that boost consumption through a slew of measures that could include optimising GST rates, reviewing of personal income tax slabs and reassessment of the interest rates to provide EMI relief to the large masses whose purchases of assets such as homes and consumer durables are through loans." These steps will not only provide tailwinds to the consumer durables industry but also have a multiplier effect on the industries that serve them, through increased capacity utilisation and hence also pave the way for private investments to flow in at a faster pace, Verma said.

Looking ahead, he said, "I hope that the upcoming budget continues to prioritise these areas while also introducing policies that promote innovation, production-linked incentives (PLIs), and sustainable practices.

These measures are crucial for driving holistic economic growth and ensuring balanced and inclusive development for India." Finance Minister Nirmala Sitharaman is scheduled to present the full budget for 2024-25 on July 23.