Budget 2025: Optimism about India’s economic growth has tempered, says Kantar survey

What India expects from Budget 2025.

Consumer sentiment in India for 2025 is a mix of declining confidence and evolving expectations with Budget 2025 around the corner.

While 67 percent of Indians perceived the 2024 budget to have aligned with their needs, this number has been on a steady decline since 2022, according to marketing data and analytics company Kantar's India Union Budget Survey. The percentage of people holding this positive view has steadily decreased over the past two years, from 73 percent in 2022 to 70 percent in 2023 indicating a gradual decline in public alignment with the budget over time.

The survey was conducted among a sample of 2,500 consumers—men and women—aged between 21 and 55 years across 16 cities. Consumers were a mix of salaried, self-employed and business owners as well as mass and affluent class, all with savings accounts across various banks and sole/ joint decision makers with respect to household finances.

Amid a GDP slowdown, optimism about India’s economic growth has also tempered. Consumers are calling for relief on income tax, increased medical insurance rebates and measures to combat inflation. While concerns over AI misuse and financial security are on the rise, worry around economic recession due to global conflicts has eased compared to last year.

Most hope for Budget 2025 to focus on stimulating economic growth by introducing protectionist policies that will address challenges like sustainable development, job creation and the high cost of living.

Against the backdrop of the recent drop in India’s GDP growth to 6.4 percent (down from 8.2 percent the previous year), 53 percent Indians believe that India’s economy will still grow faster than the previous years, but this number too has declined from 57 percent for 2024.

Indians expect the government to provide income tax relief for the salaried class, particularly targeting middle-income earners, in the upcoming budget. Increasing the basic income tax exemption limit from the current Rs 2.5 lakh-3 lakh (those below 60 years pay 5 percent tax on income above Rs 2.5 lakh) is the most common expectation. Also high on the wish list is increasing the standard deduction amount from Rs 75,000 to Rs 1 lakh. Most also want either an increase in the threshold limit of the highest tax slab from current Rs 15 lakh or a decrease in the highest tax rate of 30 percent applicable on income over Rs 15 lakh.

With the threat of the HMPV virus looming and cases of life-threatening lifestyle diseases becoming more common, there is an expectation that the government will increase the limit for various deductions under Section 80 of the Income-tax Act for medical insurance premium. There is a significant rise in consumers surveyed (42 percent in 2024 to 51 percent in 2025) who want an increased tax rebate on medical/ health insurance.

Around 59 percent Indians cite rising inflation as their primary concern. This number is also up from 57 percent last year.

Given the connected world we are in, nearly 50 percent of those surveyed are increasingly worried about the misuse of AI, particularly its potential to fuel cybercrime and threaten financial security.

Global concerns over recession and multi-nation conflicts have eased slightly, with 44 percent and 43 percent of consumers expressing worry, down from 48 percent and 45 percent in 2024, respectively.

In line with the recent market fluctuations, 62 percent Indians expect the BSE Sensex to stay between the 81,000-90,000 points range in 2025.

As India’s startup and new-age business segment matures, 70 percent expect the sector’s financial performance to improve, pointing to a time of consolidation and stabilisation after a period of rapid expansion.

India’s move towards a cashless economy seems to be on the fast track, with digital payments (UPI and e-wallets) becoming the norm for 60 percent of consumers for everyday transactions. This is up by 7 percent over the year gone by.

Concerns around climate change and its impact on the future is leading Indian consumers to become progressively open towards electric mobility. Among those intending to buy new vehicles (either two-wheeler or four-wheeler) post-2024, a sizeable proportion (59 percent) is considering an EV purchase.

Mental stress is a part of life now, and personal financial instability, workplace stress, social media pressures and cyberbullying were cited as the main pain points.

Following Donald Trump’s victory in the US elections, 53 percent of those polled believe it will positively impact India’s exports of products and services, while 20 percent have adopted a wait-and-watch approach.