Will the sails of these companies cross the budget? More money will reach the hands of the villagers. More Disposable Money To Rural India Will Boost FMCG Demand Budget 2023 Expectation

Less than a month is left for the country’s general budget to come. In such a situation, some companies hope that the government can bring such policies, which will increase the demand in rural areas and its benefits will reach their business. Read this news…

Will the sails of these companies cross the budget?  More money will reach the hands of the villagers

More than half of the revenue of the company Dabur India comes from the rural economy.

Image Credit source: TV9 Network

The coming budget this year is the last full budget of the government before the 2024 general elections. In such a situation, it is expected that the government can announce some populist policies. At the same time, some such policies can also come that will increase the demand in the country, that is, there can be an announcement in the budget to bring more money to the rural economy of the country. India’s population of about 80 crore lives in villages, which puts an impact on the overall demand in the country.

Companies in the Fast Moving Consumer Goods (FMCG) segment have the highest expectation from the government to take some measures in the budget to increase rural demand. Because this affects their demand the most. Rural demand in India largely depends on good monsoon and crop productivity.

The last budget did not benefit

Sameer Shah, Chief Financial Officer, Godrej Consumer Products, says that last year, the government had increased the budget allocation for the Employment Guarantee Scheme and other items to put more money in the hands of the villagers. But it failed to increase the demand. The reason for this was to bring it in the midst of political instability at the global level. At the same time, the growth rate of the country was also weak. The government now needs to focus on increasing the net exports of the country along with measures to increase the demand in the country.

Half of Dabur’s business in the village

More than half of the revenue of Dabur India, a company working in the Ayurvedic segment, comes from the rural economy. The company recently said in its pre-earnings report that macro economic signals are improving in the country. In such a situation, where the government has taken some good steps, it is expected that in the upcoming budget, the government can give some incentives for the improvement of the FFCG sector in the country.

Decreasing FMCG sales

The sale of FMCG sector in the country has increased by 7 percent in 2022. But a declining trend is also being seen in it. ET has reported quoting an analytical firm named Bijom that FMCG sales have declined by 4 percent in the October-December quarter of FY 2022-23. Demand in the rural economy has declined due to high inflation and less than expected rains in populous states like Uttar Pradesh, Bihar, West Bengal and Jharkhand.

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