Consumer products companies believe that the Centre’s focus in the Union Budget on higher spending on rural development, infrastructure, housing besides employment generation and skilling is expected to have a positive rub-off effect on consumption.

Naveen Malpani, Partner, Grant Thornton Bharat, “For the consumer and retail industry to succeed, volume boost is expected to come from ‘Rural Bharat’. The recent budget initiatives announced, including skilling of youth by providing financial assistance, programmes for tribal communities for socio economic upliftment, income tax benefits for increased disposal income, will have positive impact on FMCG consumption.”

“The Budget’s push on urban and rural growth will help boost rural consumption and also increase discretionary spending. Urban Housing needs of 1 crore urban poor and middle-class families are being addressed with an investment of ₹10 lakh crore. The government’s continued focus on rural infrastructure development is a step in the right direction. These measures would further boost consumer sentiments in the hinterland, which is already showing green shoots of revival,” said Mohit Malhotra, CEO, Dabur India.

Mayank Shah, Vice-President, Parle Products said the budget’s emphasis on infrastructure and job creation is likely to boost demand for FMCG sector while changes in tax regime will put more disposable income in the hands of consumers.

In fact, retail and consumer durables players expect some measures to lead to a positive consumer sentiment in the upcoming festival season. Kumar Rajagopalan, CEO, Retailers Association of India said, “The reduction of duty on gold, precious metals, and mobile phones will also provide a significant boost to these sectors, particularly during the festive season.”

Pointing out to government’s emphasis to address housing needs of urban poor and middle-class families, Sunil Vachani, President, CEAMA said that it will help increase the penetration of the consumer electronics and appliance sector in the country.

Kamal Nandi, Business Head and Executive Vice President, Godrej Appliances said, “The government’s emphasis has been on employability and employment. Favourable changes in tax slabs under the new regime and increase in standard deduction from ₹50,000 to ₹75,000 will increase disposable income in the hands of consumers and drive higher consumption.”

Aasif Malabari, CFO, GCPL added that the special focus on agricultural schemes and rural development will indirectly boost consumption spending in the rural regions.

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