India plans to raise spending on infrastructure in its annual budget next week to set the economy on a firmer footing. Still, fiscal constraints leave little chance of concessions for households hurting from the pandemic, officials said.

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Asia’s third-largest economy is estimated to expand 9.2 per cent in the fiscal year that ends in March, following a contraction of 7.3 per cent in the previous fiscal year.

Yet private consumption, which makes up nearly 55 per cent of GDP, is below pre-pandemic levels amid rising levels of household debt. At the same time, retail prices have swelled almost a tenth since the coronavirus outbreak began in early 2020.

On February 1 budget comes days before the start of elections in five states, including the most populous, Uttar Pradesh, which could spur Finance Minister Nirmala Sitharaman to promise higher rural spending and subsidies on food and fertiliser.