Finance Minister Nirmala Sitharaman is set to make history on July 23, 2024, as she presents her seventh consecutive Union Budget, surpassing the record previously held by former Prime Minister Morarji Desai. This budget marks the first for Prime Minister Narendra Modi’s third term in office and comes at a crucial time for India’s economy.The Economic Survey, tabled earlier, projects India’s GDP growth to range between 6.5% and 7% for FY 2025, positioning India as the fastest-growing major economy despite ongoing global challenges. However, this represents a slight decline from the 8.2% growth recorded in the previous year.Key focus areas for the budget include potential tax relief for the middle class, support for rural areas, and measures to boost economic growth. There are expectations of changes to the income tax structure, including possible increases to standard and exemption thresholds, and the introduction of a ‘Single Hybrid Tax System’.The government is also expected to maintain its commitment to fiscal consolidation, with aims to lower the fiscal deficit to 4.5% of GDP by 2025-26. Other important numbers to watch include capital expenditure, tax revenue, GST collection, borrowing, and nominal GDP growth.The budget comes against a backdrop of some political challenges, with the BJP-led NDA government having reduced its seat tally in the Lok Sabha, suggesting some resentment with its economic policies. This context adds pressure on the government to balance populist measures with fiscal discipline.As the budget presentation approaches, the Indian stock market is expected to open higher, influenced by positive global cues. However, analysts caution that the budget’s reception could significantly impact market performance in the coming days.
Key points
- Nirmala Sitharaman to present her 7th consecutive Union Budget, breaking previous record.
- India’s GDP growth projected between 6.
- Budget expected to focus on tax relief, rural support, and fiscal consolidation.
- Government faces pressure to balance populist measures with fiscal discipline.
5% and 7% for FY 2025.
Contradictions👾While most sources indicate positive expectations for the budget, there are also mentions of political challenges and the need to balance populism with fiscal discipline, suggesting some underlying tensions.
