NEW DELHI — The Union Budget 2024-2025 will strengthen the narrative of ‘Viksit Bharat’ by 2047 along with more job creation, following a transformation witnessed in the last 10 years across economic parameters, a report showed on Friday.
The broad focus of the government will be job creation. This could mean more impetus on infrastructure and other public welfare schemes, as well as fiscal expansion using off-balance-sheet structures, according to the report by Axis Securities.
On Thursday, Union Minister for Petroleum and Gas, Hardeep Singh Puri, hailed an SBI study, which said as many as 12.5 crore jobs were created during the fiscal years of 2014-24, marking a four-fold jump from the 2004-2014 period, which saw the creation of about 2.9 crore jobs.
The impact of the Union Budget on the equity market has reduced notably over the past few years, with the government undertaking most of the reforms outside the purview of the Budget.
“We believe, at the current juncture, the Budget will likely strengthen the narrative of ‘Viksit Bharat’ by 2047, following a transformation similar to the one witnessed in the last decade,” said the report.
After the formation of the NDA 3.0 government, expectations from the market are growing towards some allocation for the bottom of the pyramid to address rural challenges, alongside some cutoff on Capex spending.
“At the current juncture, the budget is likely to strike a balance between Capex spending and addressing rural challenges,” said analysts.
Nonetheless, a higher-than-expected RBI dividend has provided some cushion to move further towards welfare schemes.
The government is likely to continue with the Capex plan announced in the Interim Budget, pegged at Rs 11.1 lakh crore. The unwavering focus on roads, power, urban development, and railways will create key long-term economic multipliers.
Moreover, the scope of existing PLI schemes is likely to broaden to more sectors capable of generating more employment, said the report.
“As tightening monetary policy and elevated inflation levels have impacted the purchasing power of a large section of the country, we expect the budget to provide relief to those at the bottom of the pyramid,” the report mentioned.
The government is likely to continue extending support to this section by proactively providing food and fertiliser subsidies.
The report expects the FY25 fiscal deficit to be maintained below 5.1 per cent, with a vision of achieving 4.5 per cent by FY26.