Expect no drama in the Budget

But over the medium term, India's fiscal health needs attention

India’s economy has emerged from the pandemic in relatively good shape compared to others. Its adroit fiscal policy has played a key role in this recovery. Finance Minister Nirmala Sitharaman has already stated that on February 1, the government will present an interim Budget, a vote on account, and that the real Budget would be presented in July 2024 when a new government is in place. While no major new initiatives should be expected, some budgetary imperatives and parameters are already in place that will shape both the interim and the eventual real Budget for FY25.

India’s growth trajectory looks