MORE than a decade ago, the world of global high finance was agog with monikers and acronyms such as Fragile Five and PIIGS. If the latter was about the massive debt crisis faced by some, the other comprised an eclectic mix of emerging market economies that had become too dependent or unreliable to finance their onward journey. Amongst these was India! The journey from that state of gloom and economic stasis to the only ‘bright spot’ in the world can, without a doubt, be attributed to Prime Minister Narendra Modi and his team. In his last two terms since 2014, India has developed into the world’s fifth-largest economy and the world’s fasting-growing. With the dawn of Modi 3.0, all eyes are now set on the Union Budget 2024, slated for presentation in July. Anticipation runs high among industries, farmers, taxpayers, and the middle class alike, as they await potential boosts and tax reliefs from Finance Minister Nirmala Sitharaman.
This is going to be the first full Budget post the historic mandate for the Modi-led NDA. Sitharaman is also poised to make history as she is on the way to becoming the first Finance Minister to deliver seven consecutive Budgets – six complete and one interim — surpassing Morarji Desai’s record in this regard. This year is also unique with the presentation of two Budgets. The initial Budget, presented on February 1, followed tradition and served as a Vote on Account by the incumbent Government ahead of elections. Though the official date is yet to be announced, the Budget is likely to be presented during July 15-21 week. It is expected that existing schemes may see a revamp, with stronger emphasis on welfare and promoting investment within the country. Some schemes are anticipated to be extended. Given that the BJP-led NDA Government has been re-elected, significant policy shifts are unlikely, with most anticipating continuity. But the Government is set to take big decisions to push economic reforms that will lay the foundation of ViksitBharat@2047.
India’s economy is expected to grow at a robust 8 per cent in FY25, said CII President Sanjiv Puri, citing the second-generation reforms that the Modi-led Government will undertake, good monsoon prospects, and the improved external situation. A lot of policy interventions in the past have put the economy on a much stronger wicket. CII’s growth projection for this fiscal is way higher than the Reserve Bank’s forecast of 7.2 per cent. In FY24, the economy had expanded by 8.2 per cent.
The Finance Minister has initiated preBudget consultations with industry groups following discussions with Revenue Secretary Sanjay Malhotra on June 18. The upcoming Budget aims to balance growth acceleration and inflation control while funding coalition commitments. India targets becoming a $5-trillion economy and achieving a developed nation status by 2047. The RBI has forecast a 7.2 pc economic growth this fiscal, driven by rural demand and easing inflation. India’s economic policies have garnered positive feedback, with S&P upgrading the sovereign rating outlook to positive. Coming to the aid of the FM will be the robust GDP. It surpassed expectations by growing at 7.8 per cent in the January-March quarter. For the entire 2023-24 financial year, the GDP growth is set to do better. All this augurs well for the Budget.
