Budget 2024 Incentivises Employers To Create Jobs, Says S Naren

The budget has incentivised employers to create jobs, which is a fantastic step, S Naren, executive director and chief investment officer of ICICI Prudential AMC, told NDTV Profit. 

The budget introduced a comprehensive scheme under the Prime Minister's package to provide internship opportunities to one crore youth in 500 top companies over five years. 

Union Budget's focus on job creation through employer incentives and the apprenticeship process might not have immediate results, but the positive impact will definitely be felt in the long term, he said.

Naren reiterated that job creation should come from employers rather than the government, which is what the Budget is trying to do as well. Providing incentives for companies to hire, especially those with lower wages, is a logical and effective approach, according to him.

Maintaining good financial health is key when it comes to MSME credit, Naren said. MSMEs with good financial practices can secure loans at reasonable rates, he pointed out. Support should not extended to uncompetitive MSMEs merely for survival. Instead, assistance should target those with a competitive edge facing temporary setbacks, he said.

The budget increased Mudra loans limit to Rs 20 lakh for repaid previous loans and introduced a digital credit assessment model for MSMEs lacking a formal accounting system.

The government's capex remained at Rs 11.11 lakh crore for the fiscal year, he noted. Naren called for increased private sector investment to boost capacity utilisation. Many private companies expanding their capex are doing so in existing locations, rather than starting new projects from the ground up, he said.

Naren also spoke on the sustained growth in the services sector, particularly exports, over the past five years. He called for similar growth in manufacturing, urging improvements in production costs and efficiency in logistics, land, power, and labour.