New Delhi [India], January 25 : As India awaits the unveiling of its Interim Budget for 2024, there is a notable shift from grand populist gestures to a focus on policy continuity, growth, and sustainability. Key elements of the budget are expected to centre around capital expenditure, the 'Make in India' initiative, and a strong push for green energy.
While projecting a commitment to growth, the budget is likely to introduce targeted measures to stimulate demand, especially in rural and urban areas.
One area of potential attention is tax slabs, with the government possibly considering incentives to revitalize economic activity, particularly in the rural economy.
Despite potential moderation in disinvestment targets due to upcoming elections, fiscal discipline is expected to remain a priority.
The fiscal deficit for FY24 is projected to be lower than the previous year's target of 5.9 per cent of GDP, and estimates for FY25 range between 5.4-5.5 per cent of GDP, contingent on increased revenue and controlled subsidy provisions.
With an anticipated economic growth surge, the Interim Budget may forecast higher direct tax collections in FY25, targeting overall tax collection growth at 12-13 per cent, compared to 14 per cent in FY24.
Sectors across the spectrum are eagerly awaiting announcements in the Interim Budget. From agriculture and infrastructure to healthcare, education, and manufacturing, each sector is vocal about its expectations for allocations and reforms that foster growth, innovation, and societal well-being.
Varun Aggarwal, founder and managing director, Profit Idea, said, "In the IT sector, expectations hinge on digital infrastructure investments, incentives for research, skill enhancement, and innovation hubs. The industry hopes for increased funding for cybersecurity, support for cutting-edge technologies like AI, IoT, and 5G, and revisions in tax policies to stimulate IT exports. The healthcare sector anticipates revolutionary measures, including incentives for healthcare training, special GST categories for healthcare education, and enhanced allocations for digital health infrastructure and telemedicine".
Fintechs, particularly digital lending platforms, are looking for changes such as flexible Loan-to-Value (LTV) ratios to create personalized financial solutions. Tax breaks for fintech companies are considered crucial for innovation, while participation in the Account Aggregator framework is sought to enable more effective use of financial data with customer consent.
In the hospitality and tourism sector, expectations revolve around policies supporting resilience, infrastructure development, and increased room supply to meet growing demand.
Overall, the Interim Budget is poised to address diverse sectoral expectations, emphasizing growth, innovation, and inclusive development in the Indian economy.
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