The government’s innovation will be tested to deliver an effective budget, encompassing capex, rural, social, policy incentives, and subsidies…reports Asian Lite News
The FY24 Union Budget is likely to be a tightrope walk, considering its fiscal guidance and the 2024 Lok Sabha elections.
“We estimate fiscal deficit for FY24 at 5.8-6.0% and FY23 at 6.2%. Muted nominal GDP growth (due to global slowdown and low deflator) will constrain tax revenue and government spending, compared to the strong pace in the last couple of years”, a report by , Phillip Capital said.
Thus, the government’s innovation will be tested – to deliver an effective budget, encompassing capex, rural, social, policy incentives, subsidies, and tax/growth buoyancy. In case the government adopts an easy approach to the fiscal path, across-the-board expansion can be expected and delivered.
In the upcoming budget, we anticipate continued focus on PLI incentives (for new sectors), Atmanirbhar Bharat (to enhance manufacturing, exports, while managing imports), sustainability (supply/demand push towards renewable energy and alternative technologies), and infrastructure expansion (defence, railways, ports, logistics, and roads).
The government wants to encourage the adoption of the new income-tax regime, thus incentivisation is likely, the report said.
Fiscal support to rural India will continue (adjusting for food and fertiliser subsidy); we will be watching for any meaningful stimulus (low probability considering fiscal constraints).
“We are expecting decent capital expenditure outlay with cyclicals to outshine. Higher allocation is expected for Defence Capital outlay, Roads, Metro projects, Housing and Railways. PLI extension in the Automobile sector (incentivising innovation and growth), Robotics (for make in India), Metals (new steel grades), IT hardware, Footwear etc. Transportation/Logistics might attract focus by increasing the modal share of Railways (for cargo movement), growth in warehousing capacity, and support for domestic manufacturing of containers. In Autos, we might see extension of FAME subsidiary, and incentives for charging infra and flex-fuel vehicles. With India’s net zero target by 2070, Renewables (Green Hydrogen/Ammonia/Solar/Wind/Biofuels) technologies will be on the radar”, the report said.
An all-party meeting, being convened by the Centre ahead of the Budget Session, will be held in the national capital today.
The government is likely to seek cooperation from the Opposition for a smooth running of the Parliament. Union Parliamentary Affairs Minister Pralhad Joshi has convened the meeting which will be held at noon in Parliament Annexe Building.
During the meeting, the Opposition parties are likely to raise issues concerning them that they intend to raise in the Parliament.
A meeting of NDA floor leaders will also be held on January 30 afternoon to strategise floor cooperation.
The Budget Session, which is heavy with the government’s financial agenda, will be held in two parts.
It will begin with President Droupadi Murmu’s address to the joint sitting of the two Houses of Parliament. Economic Survey will be tabled after the President’s address.
Finance Minister Nirmala Sitharaman will present the Union Budget on February 1. The Union Budget 2023-24 may be the last full budget before the 2024 Lok Sabha elections.
The first part of the session will be held from January 31 and will go on till February 13. It will see the debate in both Houses on the ‘Motion of Thanks’ to the President’s address which will conclude with a reply of Prime Minister Narendra Modi.
The Parliament will reconvene after a recess for parliamentary committees to discuss the demand for grants of various ministries. The second part will begin on March 13 and will continue till April 6.
The Money Bill is passed after a discussion on demand for grants and it marks the culmination of the budget process.
During the Monsoon Session, nine bills were passed by both Houses of Parliament.
Union Budget to be paperless
The Ministry of Finance on Wednesday said the Union Budget 2023-24 will be delivered in paperless form like the previous two ones.
Union Finance Minister Nirmala Sitharaman will present the budget on February 1. “The Budget documents will be available on the Union Budget Mobile App on both the Android and Apple OS platforms after the completion of the Budget Speech by the Finance Minister in Parliament on 1st February, 2023, ” the ministry posted on its Twitter handle.
The Ministry also tweeted, “The Halwa ceremony, marking the final stage of the Budget preparation process for Union Budget 2023-24, will be held tomorrow in the presence of Union Finance & Corporate Affairs Minister Smt. @nsitharaman, in the Budget Press situated inside North Block.”
Last year, a “Union Budget Mobile App” was also launched for hassle-free access of Budget documents by Members of Parliament (MPs) and the general public after the process of the Budget presentation was completed in Parliament.
This year’s Budget presentation holds significance as it is Prime Minister Narendra Modi government’s last full budget before the next parliamentary elections, slated for April-May 2024.
The Union Finance Ministry prepares the Budget in consultation with the Niti Aayog and concerned ministries.