Union Budget 2024: Investments in rural infrastructure are key to boosting the new economy

New Delhi, July 21: There is a need for investment in districts and rural areas, both to accelerate traditional economic activities and to strengthen the new economy, which focuses on circularity, say experts. India’s rural economy employs nearly 68 percent of the workforce, yet contributes less than half of the country’s GDP.

Accelerating socio-economic status in districts is key to creating inclusive and sustained growth. Amit Vatsyayan, Lead GPS-Agriculture, Livelihood, Social and Skills, EY India, said investments in rural infrastructure, agriculture and non-farm sectors have driven impressive growth. Union Budget 2024: Finance Minister Nirmala Sitharaman presents historic seventh consecutive Union Budget in paperless format

“Initiatives such as rural digitalisation, financial inclusion, community institutions and scalable technology are crucial to revitalising the rural economy. New business models that enable rural communities to add value and reshape districts as economic corridors will be essential,” he noted.

Focusing on making rural areas champions of circularity has significant potential as overall sustainability becomes a key priority. Given that 60 percent of the rural economy is concentrated in six states — Uttar Pradesh, Bihar, Maharashtra, West Bengal, Madhya Pradesh and Rajasthan — it will be crucial to adopt a local approach that addresses specific challenges while developing the rural investment strategy, experts say. Monsoon Session 2024: Cross-party meeting convened by the government before the start of the parliamentary session.

Meanwhile, women entrepreneurs are a powerful engine for economic growth and job creation in India. With over 10 million self-help groups (SHGs) collectively holding an estimated Rs 7,000 crore in savings and maintaining a remarkably low non-performing asset (NPA) ratio of just 2.01 percent, there is a compelling case for investing in helping women become entrepreneurs.

Women-owned micro, small and medium enterprises (MSMEs) in India have shown impressive results, hiring 11 percent more female workers than male MSMEs and creating a third of all new jobs.

They have also reported a 12 percent increase in monthly revenues and a 19 percent increase in monthly net revenues, indicating better cost optimization and income growth. “To facilitate women entrepreneurship in India, it is essential to invest in creating a robust ecosystem that provides access to crucial business services such as finance, markets, skills, networking and mentoring,” said Vatsyayan.

(The above story first appeared on LatestLY on Jul 21, 2024 01:03 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).