After having presented an interim budget ahead of the Lok Sabha elections, Finance Minister Nirmala Sitharaman will now present the full budget for 2024-25 that ensures the economy continues on the high growth trajectory and creates more jobs during the Modi 3.0 government. The Budget Session of Parliament will start on July 22 and extend till August 12. Sitharaman will present the Union Budget 2024-25 on July 23. This will be her seventh budget in a row. Sitharaman will be the first Union Finance Minister to present seven consecutive union budgets. Former Prime Minister Morarji Desai had presented six budgets in a row. It remains to be seen if the budget will bring structural reforms to drive sustainable and inclusive economic growth, especially the critical role of infrastructure development.
Given the low fiscal deficit, the hefty Rs 2.11 lakh crore dividend from the RBI and the buoyancy in taxes, the Finance Minister has a lot of headroom for pushing ahead with policies aimed at accelerating growth and implementing social welfare schemes aimed at uplifting the poor. The fiscal deficit has also been reduced from more than 9 per cent of GDP in 2020-21 to the targeted level of 5.1 per cent for 2024-25. This has strengthened the macroeconomic fundamentals of the economy. The new budget also comes at a time when the Indian economy has clocked a robust 8.2 per cent growth in 2023-24, which is the fastest among the world’s major economies, and inflation coming down to below 5 per cent.
As India gears up for the Union Budget 2024-25, top-notch industry mavens are underlining the dramatic need for structural changes to foster long-lasting and inclusive financial growth. The vital role of infrastructural advancement in India’s pursuit of bagging the title of the world’s third topmost economy is a key talking point Sitharaman has been holding pre-budget consultations. As part of the deliberations, she has met economists, experts in finance and capital markets, industry representatives and agriculture experts. A concentrated approach towards structural changes, key infrastructural schemes, industry-specific drives and simplifying the taxation mechanism could be India’s road map for navigating current barriers.
Industry bodies, including the Confederation of Indian Industry (CII), have urged the government to increase capital expenditure in the upcoming budget. CII has requested the rationalisation of stamp duty on land and phasing out the cross-subsidy on power rates to “reduce the cost of doing business” and to maintain corporate tax rates at current levels to provide tax certainty for businesses. It has also sought the rationalisation of the capital gains tax rate structure. Assocham has recommended accelerating investments through public-private partnerships (PPPs) with a focus on key sectors like transportation, energy, water supply, and digital infrastructure. This will enhance connectivity, improve productivity, and bolster India’s overall competitiveness.
