 "Union Budget 2024: Nirmala Sitharaman to hold pre-budget meeting on June 20")
Finance Minister Nirmala Sitharaman will hold a pre-budget consultation with industry stakeholders on June 20. The budget for the financial year 2024-25 is expected to be presented in Parliament on July 22.
The pre-budget consultation would be preceded by an official meeting with the Revenue Secretary on Tuesday, according to a report by Mint.
The 2024-25 Budget is expected to outline the Modi 3.0 government's economic strategy, which will include initiatives to accelerate reforms. The strategy aims to transform India into a $5-trillion economy and achieve its mission of "Viksit Bharat" by 2047.
The Indian economy, as shown by the estimates of the Reserve Bank of India (RBI), is projected to grow by 7.2 per cent in FY25. The Modi 3.0 government takes over a robust economy characterised by fiscal prudence in place with a special advantage as the RBI had announced the highest-ever dividend of ₹2.11 trillion for FY24.
What can you expect from the 2024 Union Budget next month?
The report said the key policy priorities for the third term of the Narendra Modi-led government are expected to address food inflation, unemployment, agricultural sector stress, job creation, maintaining capital expenditure momentum, and enhancing revenue growth to stay on the fiscal consolidation path.
Rating agency S&P upgraded the sovereign rating outlook to positive and suggested a possible rating upgrade within the next one to two years, contingent on the government adhering to its fiscal deficit plan.
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While tax revenues appear robust, non-tax revenue remains a challenge as strategic disinvestment has seen little progress, with no significant strategic sales apart from Air India. Analysts also anticipate potential changes in the income tax regime for salaried employees, the report further said.
The report quoted Vinod Nair, Head of Research at Geojit Financial Services, as saying, "A key area of focus will be to generate jobs, especially in the rural economy. Consequently, the final budget is anticipated to feature increased government expenditure in areas such as MGNREGA, housing, water, and agriculture. Simultaneously, the government will maintain its pro-industrial policy to encourage private investments."
To support private investment, analysts anticipate an expansion of Production-Linked Incentive (PLI) schemes to encompass additional sectors, especially those that are labour-intensive. Given the critical need for youth employment, substantial government capital expenditure and increased funding for micro, small, and medium enterprises (MSMEs) and startups are expected.
Increasing the minimum support price (MSP) or offering price guarantees, coupled with lifting export bans on agricultural products such as onions, wheat, and sugar, will be beneficial. "In the near term, agricultural productivity may decline due to the heat wave in the north, necessitating government support. However, an uplift in monsoons and heatwaves is forecast in FY25 compared to below normal in FY24, which will lead to a reversal in fortunes," Nair said, as quoted by the report.
Nirmala Sitharaman to set new record
Nirmala Sitharaman is set to make history next month by presenting the Union Budget 2024-25 in Parliament. She will be India's first finance minister to present seven consecutive Union Budgets, crossing Morarji Desai's record of six.
Prior to Sitharaman, Morarji Desai had tabled five full budgets and one interim budget, serving as the country's finance minister from 1959 to 1964. Desai has held the record for the highest number of budgets presented by any finance minister of India, with a total of ten, for over five decades.