Zero electricity bill, tax tweaks: Govt's 100-day agenda, budget wish list

As the Lok Sabha 2024 elections come closer to the finish line, all eyes are now set on the 100-day agenda of the next government and the proposals and policies proposed in the full budget for financial year 2024-25 (FY25).

While the markets expect the Narendra Modi-led National Democratic Alliance (NDA) to come back to power for the third consecutive term from 2024 – 2027, its muscle / strength in the third term, however, has been a subject of debate after PM Modi’s ‘Abki baar 400 paar’ narrative.

In the near-term, all eyes will be on the July budget, suggests a note from Mirae Asset, for changes in direct or indirect taxation, MSP policy and MGNREGA payments. 

This, it said, is assuming that the NDA will return to power under the leadership of PM Modi.

From a long-term perspective, however, the focus, Mirae Asset said, would be on infrastructure development, farm laws, skill development, and creating employment on the manufacturing side to spur demand from rural India.

Here are some of the measures Mirae Asset expects the new government to undertake within 100 days of its formation, including in the full budget likely to be presented in July 2024.

Continuing the growth trajectory: Mirae Asset expects a commitment from the government to make India a $5 trillion economy. It has recorded over 7 per cent GDP growth rate for the last 3 years. Economic policies, higher tax collections, infrastructure spending, digitisation, and financial inclusion are all contributing to a global top-tier growth dynamics. They expect continuity in this regard.

Insurance sector reforms: The reform involves granting a composite insurance license to a single entity, which allows them to offer both life and non-life products. Countries like Singapore, Malaysia, and the UK, it said in the note, allow such entities.

Currently, paid-up equity capital of Rs 1 billion / Rs 2 billion is needed for general or health insurance / reinsurance businesses, respectively. On that front, Mirae Asset there expects some relaxation.

Ayushman Bharat Yojana: The current scheme provides insurance coverage of Rs 5-lakh per poor household every year. The coverage amount, Mirae Asset said, can be increased to Rs 10-lakh in the upcoming July budget. An additional outlay of Rs 50 billion might be required for this, it said.

New interest subsidy scheme for affordable homes: In the full-year July budget, they expect lower interest rates to further drive growth in the real estate sector.

Modernisation of Indian Railways: Mirae expect an investment of around Rs 10 - 12 trillion in the next five years to equip Indian railways with modern, world-class facilities. This announcement, along with the budget, can be expected, it said.

10 new cities: With initial funding requirement of $1.2 billion, 10 new cities could be set up to expand manufacturing and help population decongestion, the note said.

Implementation of Citizenship Amendment Act: A law, which was passed in the parliament in 2019, but its enactment has faced roadblocks. The rules of CAA act were mentioned before the 2024 elections started. A strong mandate, Mirae Asset said, might lead to an announcement on it.

Zero electricity bill: Announcement of zero electricity bill via solar power to poor households could also be on the agenda, the note suggests.

Listing of Indian companies: Clarification on listing of Indian companies directly in international exchange through GIFT city could also be on NDA 3.0's agenda, the note said. Though some rules have been stated earlier, further inputs from the government are awaited.