Budget 2024 Highlights: Defence Ministry gets Budget boost, govt spending on DRDO sees upward revision too

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Bharatiya Mazdoor Sangh welcomes the Union Interim Budget, saying, "The Bharatiya Mazdoor Sangh welcomes the provisions regarding the ASHA workers and the Anganwadi workers... The announcements were made keeping the long-term development of the country in mind..."

“In 2014, our economy was considered a part of the fragile five, which should have caused concern. However, now it is among the top 5 economies and has become one of the world's fastest-growing economies. Today's budget showed the roadmap to a ‘Viksit Bharat’.”

Ministry of Defence has received a robust budget of Rs 6,500 crore for Border Roads Organisation in the financial year 2024-25, marking a 30% increase from the previous fiscal year, the Defence Ministry said.

DRDO's Budget sees a boost to Rs 23,855 crore in the financial year 2024-25, with a focus on capital expenditure and support for start-ups, the ministry added.

The Indian Coast Guard’s budgetary allocation increased this year by 6.31 percent to Rs 7,651 crore. Rs 3,500 crore has been provided for capital expenditure for modernisation.

West Bengal Minister Shashi Panja says, “Everyone was expecting that the Government will give a report on the works completed... People had expectations that the income tax slab would be relaxed... No plans were announced regarding the increasing unemployment...”

Realtors hailed the Budget proposal of launching a scheme to help middle-class people buy or build their own homes, saying this will boost demand for residential properties and help in the overall growth of the real estate sector.

In the interim Budget for 2024-25, Finance Minister Nirmala Sitharaman announced that the government will launch a scheme to help deserving sections of the middle class 'living in rented houses, or slums, or chawls and unauthorised colonies' to buy or build their own houses.

She also said 2 crore more homes will be built for the rural poor in the next five years under the continuing PM Awas Yojana (Grameen).

“Picture abhi baki hai,” senior Congress leader Shashi Tharoor asserted on February 1, as he rejected the BJP's claims that the 2024 poll results are a foregone conclusion, and said the interim Union budget sounded like the Modi government's final.

Criticising Finance Minister Nirmala Sitharaman for describing GDP as governance, development, and performance, Tharoor said that under this dispensation 'G' stands for for governmental intrusion and tax terrorism, 'D' for demographic betrayal and 'P' for poverty and rising inequality. Terming the interim Union budget "disappointing", Tharoor said the omissions were startling with unemployment completely escaping the finance minister's speech.

The government gets a "failing grade" on the count of improving the lives of the common person, he added.

“The Budget has maintained a consistent focus on infrastructure spending as the key driver for enabling India’s competitiveness as a destination for new investments. This budget has a very strong focus on transportation infrastructure. I look forward to the projects getting implemented soon,” says Mohammad Athar, Partner and Leader, Industrial Infrastructure, PwC India.

Finance Secretary TV Somanathan says, "...To control inflation is a big thing for the middle class and inflation will be controlled with the prudent policies of the government..."

He adds, “A new scheme of housing for the middle class is also being introduced. Solar rooftop scheme -- the middle class is the target for this as well.”

The interim Budget also mentions the investment the government will be making in IITs, IISCs, medical colleges & AIIMS. Training, skilling and opportunity will also increase through this, he further says.

Atul Soneja, COO of Tech Mahindra, sees Interim Budget 2024 as embodying the "Amrit Kaal" path to inclusive growth, sustainable development, and next-generation reforms.

- Views it as a significant step toward encouraging investments and job creation.

- Notes the government's focus on four essential pillars of growth: Garib (Poor), Mahilayen (Women), Yuva (Youth), and Annadata (Farmer).

- Highlights initiatives like the announcement of a corpus of Rs 1 lakh crore with 50-year interest-free loans for the private sector to scale up research in sunrise domains.

- Believes these measures will help India consolidate its position globally as a Tech Powerhouse driven by a skilled tech workforce and innovation.

- Vinay Dube, CEO of Akasa Air, acknowledges government efforts to strengthen the aviation industry, including doubling the number of airports.

- Dube appreciates the focus on inclusive and sustained growth in the budget.

- He believes the measures will catalyze India's progress and contribute to its position as a global economic powerhouse.

- Dube expresses enthusiasm as India's fastest-growing airline with an orderbook of over 200 aircraft.

- Akasa Air CEO appreciates government's commitment to enhancing air transport infrastructure and making air travel accessible to more Indians.

- Divyesh Dalal, MD and Head - Global Transaction Services, SME, and Institutional Liabilities, DBS Bank India, sees the Budget as establishing a robust foundation for "Viksit Bharat", aligning with the government's vision to develop India into a developed nation by 2047.

- Dalal recognises the government's commitment to green growth, welcomes Bio-Manufacturing Scheme. It says this resonates with DBS Bank India's focus on financing sustainable projects and aiding businesses in transitioning to low-carbon operations.

- Dalal appreciates the budget's focus on training for Micro, Small, and Medium Enterprises (MSMEs), foreseeing it as a means to equip them with skills fostering innovation and adaptability. This is expected to enhance the competitiveness of MSMEs on the global stage.

- The increase in the presumptive taxation threshold from Rs 2 crore to Rs 3 crore is noted as a substantial relief for small retail businesses. This measure is anticipated to alleviate financial burdens on these enterprises.

The 2024 Budget’s focus towards four major pillars – youth, poor, women, and farmers will collectively work towards the vision of a ‘Developed India by 2047’.

-- I commend the government's steadfast commitment to fiscal consolidation, aiming for a 4.5% fiscal deficit in 2025-26. Recognizing the significant transformation in the Indian economy over the past decade and highlighting structural reforms underscores a positive trajectory for economic resilience.

-- The decision to maintain current tax rates for direct and indirect taxes, including import duties, will provide a much-needed sense of stability for businesses and investors.

“The government has laid the groundwork to usher in next-generation reforms, steering the growth of India by providing a significant boost to infrastructure development and bridging the accessibility gap to fulfil the aspirations of its citizens. The commitment to education and skill development through successful initiatives like Skill India has offered training, skilling, and reskilling to millions, enabling them to acquire cutting-edge skills and secure employment opportunities. This will undoubtedly contribute to our collective economic resilience and competitiveness on the global stage.”

“The government's emphasis on technology, including the provision of 50-year interest-free loans, underscores its dedication to investing in Deep Tech, requiring substantial investment and highly skilled human capital. Although the EdTech sector anticipated some tax incentives that could have benefited our learners, we remain highly optimistic about the upcoming full budget, expected to announce next-generation reforms, will address these concerns.”

BJP MP Janaynt Sinha told Moneycontrol, “Modinonics 3.0 is all about Viksit Bharat, India as a superpower. and a global leader. We see this framework coming through very strongly in this budget. Three aspects of this Budget that demonstrate this are:

Macroeconomic stability provided over the last 10 years that given people the confidence to invest

Focus on capital expenditure and infrastructure

Take the four important sections of society (poor, youth, women, and farmers) and provide them with all the tools and facilities necessary for their empowerment and growth.

The fourth part is around research and innovation. Research enables us to grow faster

Further, the focus on young people is entirely a focus on jobs. All of the efforts underway in terms of education, training and skilling are all there to enhance job creation. Data indicates unemployment coming down; job creation is our top priority.

“The interim Budget may be categorised as a financially prudent budget targeted to achieve fiscal consolidation in the long term. It stays away from presenting a populist budget despite the upcoming general elections and this exhibits the confidence levels of the present central government.”

“The Government’s focus on developing the power sector through a host of renewable energy initiatives, upgrading railway infrastructure to support the Gati Shakti programme, and boosting the affordable housing sector would certainly act as a catalyst in achieving the dream of the Prime Minister for leading the country into ‘Vikshit Bharat’ by 2047. The Government also emphasises developing women empowerment further and making them more financially empowered.

“The Government’s gross borrowing number at Rs 14.13 lakh crore also highlights that it expects the private sector now to take the lead in initiating the capex programme as a stable macro environment in the country. To conclude, it’s a prudent budget aimed at bringing fiscal stability in the country.”

“The interim budget focuses on boosting holistic economic growth. Allocating Rs. 1 lakh crore for interest-free loans emphasize the government's commitment to strengthening innovation and research. Additionally, highlighting the role of digital public infrastructure shows a push towards formalizing the economy. These measures support the organized financial services sector, enhancing lending, investments, and savings efficiency.”

-- Rs 18-19 lakh crore capex for FY25 is substantial when public and private capex is combined

-- Rs 25 lakh crore is the market cap increase in PSUs in 1 year

-- Strategic disinvestment transactions like IDBI taking time due to proper testing by regulator

The 1 lakh crore corpus fund for developing new technologies will change the country. India is now a talent nation, the corpus fund will make India a product nation, says Ashwini Vaishnav. In the coming days we will come up with the contours of how the Rs 1 lakh crore corpus fund will work, he adds.

He further says, “The next spectrum will be a limited auction. Every financial year we are trying to have an auction.”

Railway Minister Ashwini Vaishnav has said that India will get 10 Vande Bharat sleeper trains by March 2024.

He added, the “kavach” (automatic train protection system) has installed across 847 km of India Railways and 170 locomotives.

The three corridors that were announced today are not the same as the earlier plans of creating more dedicated freight corridors, Railway Minister Ashwini Vaishnav clarified

The Railway Minister said the estimated cost of upgrading 40,000 coaches is around Rs 15,200 crore will take 5 years

“There are 434 projects worth an initial estimate of Rs 11,000 crore to create the new three railway corridors. Some projects as part of the three new railway corridors will be sent to Cabinet next year,” Vaishnav added.

The numbers in the Budget are realistic. The rate of capex increase is going down, not the capex. Also seeing good growth in private sector capex, says Chief Economic Advisor V Anantha Nageswaran.

Indian Railway carries 700 crore annual passengers at the moment. The Indian Railways aims to carry 1000 crore annual passengers soon, says Railway Minister Ashwini Vaishnav

The operating Ratio for 2023-24 stands at 98.7 percent and the target for next year is also 98 percent, he adds

The Railway Minister says, “The Indian Railways revenue has increased significantly in the last two years.”

He further says, “As part of the 40,000 wagon upgrades Indian Railways plans to upgrade seats, and toilets.”

“In the last 3-4 years, public expenditure on infrastructure as asset creation was the path we took. This was to ensure we recover fast from the impact of the pandemic. In the next 3-5 years we want to ensure sustainable growth for which capital expenditure is important,” says Finance Minister Nirmala Sitharaman

“Did not want any populism in vote on account. We knew our track record will explain it,” said Finance Minister Nirmala Sitharaman while discussing her 2024 interim Budget in an interview to DD news.

Diving deeper into the details, the Finance Minister said, “Prudence is not only just in cutting expenditure, which we have not done in large cases, but in improving revenues and avoiding wastage. Tax payers money has been treated with the respect it deserves.”

Speaking on women empowerment, she said, “Not only the women reservation bill, but from 2014, steps have been taken to empower women. We are prioritising women in every sector.”

Have spent 85% of allocated capital expenditure so far till January 2024, says Railway Minister Ashwini Vaishnav, and adds, 100% electrification of Indian Railways will be completed soon.

Railway Minister Ashwini Vaishnav says, In this budget the government has focused on creating three separate railway corridors.

"40,000 km of new tracks will be laid to create these new corridors in the next 6-8 years," he adds.

The Railway Minister also said, Once the three new railway corridors are completed there will be enough capacity to get rid of waiting lists while booking tickets

Railway Minister Ashwini Vaishnaw: The success of Vande Bharat and Amrit Bharat trains has prompted the FM's announcement to upgrade train coaches

Seeing a new kind of buoyancy in growth coming of various sectors, find every sector is revving to move fast. The pattern with which growth is happening is that every sector is trying to contribute to growth, said FM to DD News.

Seeing newer areas of activities opening up and are suddenly now contributing to growth, for eg: the space sector. The strtups in this sector are acting as a growth multipier, she added.

"We welcome the interim budget's focus on skilling, deeptech, R&D, innovation, and digital infrastructure, all of which are critical drivers for the IT industry's growth. The Skill India Mission has helped in building a highly skilled workforce, and the Rs. 1 lakh crore corpus with interest-free loans for tech-savvy youth will be a true game-changer. This will fuel innovation and entrepreneurship, fostering the next generation of tech leaders. As we strive towards achieving the goal of "Viksit Bharat" by 2047, LTIMindtree stands committed to partnering with the government in its digital transformation journey. We believe this interim budget has laid a strong foundation for continued growth, with technology playing a pivotal role in shaping India's future,” says Debashis Chatterjee, MD & CEO, LTIMindtree.

White Paper reviewing economic performance of last 10 years versus the previous 10 years will likely be issued next week and tabled in Parliament: Govt source

"The Finance Minister spoke about GDP but didn't address per capita income. She barely referred to inflation, and she failed to mention that food inflation is currently at 7.7 per cent," says Congress leader P Chidambaram.

An excellent Budget that will give even more momentum to India’s impressive growth story. Higher levels of government capital expenditure accompanied by fiscal consolidation is the perfect recipe for driving up private investment. The three new economic railway corridors will be a gamechanger in logistics for industry. The FM’s focus on youth and women - the two demographics that will drive India’s transformation – is heartening : Anil Agarwal, Chairman, Vedanta Group.

“I would like to laud the Finance Minister for presenting a Budget that demonstrates India’s confidence as an economy of substance and immense promise, marching towards a Viksit Bharat on the pillars of exemplary governance, continuity of far-sighted reforms, consistency of vision and strategy and an unprecedented thrust on infrastructure development, sustainable and inclusive growth as well as technological excellence," said Sanjiv Puri, MD, ITC.

On the interim budget, Uttar Pradesh Chief Minister Yogi Adityanath says, "The interim budget presented in the Lok Sabha under the guidance of PM Modi is going to give impetus to the building of a developed and self-reliant India. In line with the hopes and aspirations of 140 crore Indians. I congratulate Union Finance Minister Nirmala Sitharaman for presenting the budget. The budget will prove to be important in fulfilling the dreams of all sections of the society."

"The Union Government's commitment to GIFT IFSC's comprehensive development is commendable, evident in Finance Minister Smt. Nirmala Sitharaman's interim budget. Recognizing the crucial role of GIFT City as a global financial gateway, the decision to extend tax exemptions on specific IFSC unit income, reflects a forward-looking approach. GIFT IFSC welcomes this move, crucial for sustaining ease of doing business and ensuring stability in taxation. This decision aligns with our shared vision for fostering a thriving IFSC ecosystem, contributing to India's economic prowess. We appreciate the government's continued support, emphasizing GIFT IFSC's pivotal role in the global financial landscape," said Tapan Ray, MD and Group CEO, GIFT City.

Capex from government will continue, it is important to continue it. We have given a good number on capex in this Budget as well: FM Sitharaman

Finance Minister Nirmala Sitharaman: MGNREGA allocation is not based on a trend. It is based on demand from the ground. As for how MGNREGA is operating in some states, the CAG has already commented on that and highlighted where course correction has to happen in some states.

CAG has commented on MGNREGA claims which need to be verified, needs course correction, she added.

The confidence that we will lower our market borrowing in 2024-25 comes from the Budget numbers. If they are realistic, then it gives us confidence. The expenditure numbers are realistic, so the deficit number is achievable. So these are very realistic borrowing numbers, said Finance Secretary TV Somanathan.

Finance secy: Lower gross borrowing numbers are very realistic despite decline in small savings shown next fiscal.

Economic Affairs Secretary Ajay Seth said nominal GDP growth assumption of 10.5 percent for 2024-25 is a reasonable number.

The interim budget for 2024-25 firmly conveys the government's commitment to its fiscal consolidation goals, set against a backdrop of healthy economic growth. Although political considerations likely influenced the lack of significant tax measures, the government demonstrated fiscal restraint in not resorting to large handouts or increasing discretionary spending ahead of this year's elections. Consequently, the government anticipates that reduced spending as a percentage of GDP will largely drive the reduction in the fiscal deficit, despite ongoing increases in planned infrastructure spending. Given the challenging global environment and the potential for climate-related shocks, emerging spending needs not currently included in the budget could restrict the government's ability to meet its deficit target. Furthermore, the envisaged fiscal consolidation will not alleviate pressures on debt affordability amidst high current interest rates, as the budget projects debt servicing costs to account for an increasingly large portion of revenue. We expect the final budget, to be released after the elections, to provide more definitive indications of India's fiscal consolidation trajectory over the medium term, said Christian de Guzman, Senior Vice President, Moody’s Investors Service.

PLI projects are not concentrated in three states because we want them to be concentrated in three states. There is no criteria of geography for PLI scheme. The criteria are manufacturing and how many additional units are produced, says Finance Minister Nirmala Sitharaman.

There are disturbances in the Red Sea, Sitharaman agreed in response to a query, but added that the India, Middle East, European Corridor project will be taken forward. The project was announced last September, during the G20 Summit in New Delhi.

Committee on demographics will have a mandate to examine the opportunities, challenges, the current numbers, and how they are changing over a period of time, Economic Affairs Secretary Ajay Seth said.

If you look at performance of CPSEs, they are big market players and continue to reward shareholders, including government, DIPAM Secretary Tuhin Kanta Pandey. Therefore, a calibrated disinvestment strategy is needed, he added.

The cost to the exchequer from the withdrawal of 1.1 crore outstanding small direct tax demands for certain years is less than Rs 3,500 crore, Revenue Secretary Sanjay Malhotra said.

There will be no extension of lower tax rate to new manufacturing units that come into place after March 2024, Sitharaman clarified during the post-Budget press briefing.

Every ratings agency should take on board that we have not only cut fiscal deficit but have also bettered fiscal consolidation, the Finance Minister said. A simple straightforward message for every ratings agency is that we not only aligning with the fiscal consolidation roadmap we had given earlier but are even bettering it, she added.

"Working on the contours of the urban housing scheme. For now we have given a token amount and we will decide on the funding of the scheme once contours are ready," Finance Secretary TV Somanathan said, in response to a media query.

For disinvestment, we don’t have a fixed target for FY25. That’s why we have kept a ‘other receipts’ head. If we get an opportunity, we can even exceed that, Disinvestment Secretary Tuhin Kanta Pandey said.

The government has largely kept vote on account as vote on account. We have laid out a plan for the sectors that we will focus on in the July Budget, Sitharaman said.

The target to reduce the Centre’s debt-to-GDP ratio to 40 percent was set before COVID-19 period, Finance Secretary TV Somanathan said. The relevance of the target now has to be examined, he added. The target to reduce the Centre’s debt-to-GDP ratio to 40 percent is a historical relic, he further noted.

"It is an 11 percent growth on capex on a high base," the finance minister said, in response to a query on capital expenditure growth. "And, we can see signs of private sector also coming in," she added.

(Budget) Estimates are always realistic with us, Sitharaman said, in response to a media query. "This is our realistic and slightly conservative estimates," she said, referring to the estimates shared in her Budget speech.

Will issue a white paper on economic performance of the last 10 years versus the 10 years prior to that, the finance minister said. She also referred to as the period of next 25 years, dubbed as Amrit Kaal by the government, as "Kartavyakaal".

States of Bihar, Jharkhand, Odisha, West Bengal, Chhattisgarh and West Bengal will be the engines of growth, Finance Minister Sitharaman said.

The finance minister stressed on five disha nirdashak baatein (path-showing points): 1. Social justice as effective governance model, 2. Focus on poor, youth, women, and the Annadata (farmers), 3. Focus on infrastructure, 4. Use of technology to improve productivity, 5. High power committee for challenges arising from demographic challenges.

The fiscal deficit target of 5.1 percent of GDP for 2024-25 clearly indicates that we are on well on track to meet or be below 4.5 percent by 2025-26, Sitharaman said.

Sitharaman said the government has brought down fiscal deficit inspite of challenging times with prudence and transperancy. Inflation management, handling economic fallout of Covid, using DPI for growth of economy and cleaning up the banking system showcases the government's performance, she added.

India has seen three consecutive years of 7 percent growth, Sitharaman said, while highlighting the government's performance over the last 10 years. "We have better managed economy with right intent and policies," she added.

This is an interim Budget presented just before elections. I want to drawn attention to GDP - governance, development and performance. I would like to outline what we have achieved in all these three, Finance Minister Nirmala Sitharaman said.

Finance Minister Nirmala Sitharaman, Finance Secretary TV Somanathan, Economic Affairs Secretary Ajay Seth, Revenue Secretary Sanjay Malhotra, Financia Services Secretary Vivek Joshi, Disinvestment Secretary Tuhin Kanta Pandey, and Chief Economic Adviser V Anantha Nageswaran will address the press in a couple of minutes from now. Stay tuned.

On Union Interim Budget, Union Minister c says, "This budget is motivational for the people of India. With the goal of ensuring 'Sabka Sath, Sabka Vikas, Sabka Prayas', and putting the people of India in a top position, the government of India has presented this budget..."

The large interest free outlay will further boost our tech start-up ecosystem in emerging areas around 5G, generative AI, agritech and health tech. The 1-lakh crore corpus that will be made available with 50 year interest-free (long-term financing or refinancing) to encourage the private sector to scale up R&D in sunrise domain is a welcome move for the sector. This will push India to be on the forefront of innovation and skill enhancement. -- Peeyush Vaish, Partner and TMT Industry Leader, Deloitte India

On Union Interim Budget 2024, Former President FICCI & Chair ISC Naina Lal Kidwai says, "The budget was a bit of a surprise because many of us were expecting a commitment to stay with the fiscal deficit at 5.3%... The government has announced a fiscal deficit of 5.1%, which is even stricter than what they had originally indicated and which the markets had readily accepted... We don't know on what basis they believe that the revenues will be good and healthy enough to enable the fiscal deficit at 5.1%. Because on the other hand, there has been no scaling back of capital expenditure. There is an increase of 11.1%... We have had a pretty big allocation in capital expenditure... So these are two huge positives. CapEx up. Fiscal deficit down..."

“The interim budget promises continuation of the government's policies and priorities of reforms and overall development. The government has managed to maintain a healthy balance between providing resources for growth while adhering to the path of fiscal consolidation. The fiscal deficit is pegged at 5.1% against 5.8% for FY24RE and is expected to further consolidate to the government's long-term target of 4.5% by FY26. The focus of the budget remains on infrastructure/capex growth and innovation while remaining prudent on the fiscal front,” said Sachin Bajaj, Head-Investments, Max Life Insurance

"The Interim Budget 2024-25 is clearly prepared with a vision towards making our country Viksit Bharat by 2047. With a substantial increase in infrastructure outlay the budget has rightly given a thrust to multi-modal connectivity by implementing three major economic railway corridor under the PM Gati Shakti programme. These initiatives will go a long way in improving logistics efficiency and reducing cost. This will surely elevate India's logistics and infrastructure landscape,” said Rajiv Agarwal, MD & CEO, Essar Ports.

"I think it is an incredibly positive budget. The government is following a roadmap towards a developed India by 2047. I think all the steps that are being taken are towards the larger objective," says Ajay Singh, President Industry body Assocham President and Chairman and Managing Director (CMD) of SpiceJet on Union Budget 2024.

Finance Minister Nirmala Sitharaman announced key infrastructure allocations in her budget presentation today, February 1, pertaining to expansion of existing airports and railway corridors, which according to real estate experts will boost increased real estate activity, especially in tier II and III cities.

Presenting the interim budget on Thursday, the FM announced the implementation of three major railway corridor programmes under PM Gati Shakti and the expansion of existing airports under the UDAN scheme. Additionally, the government elevated its capital expenditure (capex) allocation for the fiscal year starting April 1, 2024, to Rs 11.11 trillion. More here.

"A progressive budget, covering both social aspects and infrastructure development for economic growth. The expansion of ABDM beyond the doctors and nurses to Asha workers, Anganwadi works, paramedics etc. will allow for a verifiable registry of healthcare professionals thru which several programs can be executed at the grassroots level. This was a big challenge when covid hit us. Secondly the interest free loan for research and development in the sunrise sectors will be another opportunity for the youth of India to come out with innovations and drive the startup ecosystem. We have already seen space sector doing really well due to innovation by startups," said NSN Murty Partner & Leader, Government & Public Services, Deloitte India.

"The benefits available under the IFSC regime for investment divisions of offshore banking units and non residents leasing aircraft to IFSC units has been extended to businesses commencing operations until 31 March 2025. This should provide more time for foreign banking units and aircraft leasing companies to take advantage of the benefits to reduce tax cost. This further emphasises the intended push by the Government to promote investments in IFSC and attract foreign investments. One can expect further benefits in the budget to be announced post the general elections," said Kumarmangalam Vijay, Partner, JSA.

"Additional 2 crore houses under the PMAY (Grameen) over the next 5 years and, the proposed launch of an housing scheme to middle class would boost demand for affordable housing units. This augurs well for housing finance companies, who have been a key driver of credit to these segments in the recent past. While liquidity at this juncture look tight, a lower GOI borrowing programme in the next fiscal could temper the funding cost increase of these lenders" said M Karthik, Senior Vice President & Co-Group Head, Financial Sector Ratings, ICRA Ltd.

FM’s interim budget is balanced from the point of view of adhering to fiscal prudence, boosting infrastructure growth and prioritizing focus on four key sections of the economy - the poor, women, youth and farmers. We believe the FM’s focus on higher outlay for infrastructure will help in boosting the broader economy and in the long term will boost investment activity. The government’s support to MSMEs, women entrepreneurs and the agricultural sector aptly aligns with our aim to provide credit support to MSMEs, small business owners, farmers and women entrepreneurs thereby addressing their economic needs : George Alexander Muthoot, MD, Muthoot Finance.

“The Interim Budget 2024 lays a strong foundation for building a prosperous and inclusive India, in line with the vision of 'Viksit Bharat’. We echo the sentiment of empowerment for every section of society, particularly the 'Garib', 'Mahilayen', 'Yuva', and 'Annadata'. Their progress is intertwined with the nation's advancement, and it's heartening to see the Government prioritize their needs and aspirations," said Nadir Godrej, Godrej Industries Ltd.'s Chairman and MD.

"The recently released World Economic Outlook report of the IMF, calls India a bright spot and has increased our growth estimates. The Budget speech reaffirms and consolidates this growth trajectory. In keeping with constitutional and legal convention, the Budget did not make significant changes to tax or the policy regime. However, it had an important signaling impact. The references to next generation of reforms, continued focus on trade and investment and attention to sunrise sectors such as technology and the energy transition set the path for higher as well as better quality growth for the coming year," says Cyril Shroff, Managing Partner, Cyril Amarchand Mangaldas.

The decision to continue tax incentives for investments by sovereign wealth funds and pension funds and those available to startups provides certainty and predictability. The procedural changes to the tax regime also facilitate streamlining and will have a multiplier impact. The withdrawl of older disputed tax demands similarly affords clarity to tax payer and will give a more real picture of public accounts. Within the constraints of the present budget, the finance minister has hit all the notes of growth, policy and tax certainty and being poised for continued reform: Cyril Shroff

This budget lacks major announcements but clearly elucidates the government's intention to promote growth through inclusive policies. In this sense, one should expect continuity from the government if re-elected. Another appealing aspect is the roadmap laid out by the Finance Minister (FM) to achieve the 4.5% fiscal deficit to GDP target by FY26. Accordingly, the 5.1% target for FY25 represents a significant step towards achieving the 4.5% goal. At the same time, the FM continues to take responsibility for leading capital expenditures: Indranil Pan, Chief Economist, YES BANK.

On Interim Budget 2024-25, Kamal Bali, President and MD, Volvo Group India says, "I think the Budget is very bold, very inclusive, very pragmatic and touching all sectors of the economy & all sections of society. So, from that point of view and considering that it was an Interim Budget, I think the FM has done an outstanding job. I say bold because it is actually looking at fiscal deficit which, in the current year, is going to be at 5.8% instead of 5.9% which is better than the original budget. In the coming year, this has been pegged at 5.1% instead of 5.4%. So, to my mind that is a very bold measure and a very responsible measure. That will help to tame inflation. So, that is something very good..."

“While it was an interim budget, there were a couple of very important announcements that can positively impact a startup’s economy,” says Kunal Bahl, former CEO of Snapdeal, on Union Budget 2024.

Finance Minister Nirmala Sitharaman in the Interim Budget has lowered the allocation for fertiliser subsidy by 13 percent to Rs 1.64 lakh crore for 2024-25 as compared to Rs 1.89 lakh crore revised budget estimate for FY24.

The allocation for fertiliser subsidy for FY24 was budgeted at Rs 1.75 lakh crore in FY24. Read more.

The Budget has stuck to the task of following the path of fiscal prudence and indicated 5.1% as the deficit target for FY25. Given that the government was able to maintain the deficit ratio at 5.8% instead of 5.9% for FY24 even though the denominator was lower, it does look a pragmatic target. It does look likely that the target of 4.5% will be achieved in FY26.
Within the confines of the fiscal space that is available, the government is channelling enough for capex which is almost 40% of the additional total outlay. This is being directed to roads, railways and defence and it can have positive linkage effects with industries like steel, cement, capital goods etc. the states would continue to get around Rs 1.3 lakh crore from the centre and would be expected to also ramp up their spending.
From the banking perspective, a lower gross borrowing programme augurs well as there will be less pressure on the system for deployment of funds. Also given that more FPI will flow to GSecs, they can use their funds for financing credit: Madan Sabnavis, Chief Economist, Bank of Baroda

While we did not expect any major announcements in this budget, the lower fiscal deficit coupled with higher capex outlay will aid continued momentum of India growth story. Both of these moves are enablers for a pickup in private capex cycle: Ashish Gupta, CIO, Axis AMC

The central government has reduced the budget allocation for the Faster Adoption and Manufacturing of (Hybrid and) Electric Vehicle (FAME) scheme by nearly 44 percent to Rs 2,671 crore for FY25, which may result in a slowdown in the adoption of electric vehicles in India. Read the details here.

"The budget has laid a roadmap for ensuring a green gas-based economy in India. The policy mandating phased blending of CBG for CNG and PNG will help in greening the gas supply chain and balancing the demand-supply for clean fuels. Financial assistance for procuring biogas aggregation machinery would tremendously help in energising the biofuel segment. We feel this budget has created a conducive environment for the trading of clean and eco-friendly biofuels, in alignment with India’s net-zero goals," said Rajesh Kumar Mediratta, MD & CEO, Indian Gas Exchange

"...There has been no change on the taxation front, and we will have to wait for the full budget for any changes, with the government sticking to the norm of not making major announcements in an interim budget. The additional allocation of INR 1.1 trillion for capex, taking it to INR 11.1 trillion, should provide continuity in the pace of infra creation and in bringing down the logistics cost in the country progressively," said Ranen Banerjee, Partner and Leader Economic Advisory, PwC India.

On Interim Budget 2024-25, BJP MP Ravi Shankar Prasad says, "This is a very effective and historical interim budget. It mentions the achievements of the past and a strong path towards the future. We will present the full budget in July... The number of taxpayers has increased. They have faith in the government that their money will not be misused... India has traversed a path from 'Fragile 5' to the world's 'Top 5' economies in just 10 years."

Exuding political confidence ahead of the Lok Sabha elections, PM Narendra Modi’s government chose to go with fiscal prudence and no major surprises in its last budget before the polls. Finance Minister Nirmala Sitharaman stayed the course with a balanced, workman-like interim budget. Read more.

Budget draws roadmap to achieve PM Modi's vision of a developed Bharat by 2047: HM Amit Shah.

On Union Interim Budget 2024-25, PM Narendra Modi says, "In this budget, keeping fiscal deficit under control, capital expenditure has been given a historic high of Rs 11,11,111 Crore. If we speak the languages of the economists, in a manner this is 'sweet spot'. With this, besides building India's modern infrastructure of the 21st century, innumerable new job opportunities for the youth will be prepared."

"This Budget guarantees to strengthen the foundation of Viksit Bharat in 2047. I congratulate Nirmala Ji and her team. This Budget reflects the aspirations of young India," says PM Modi in his remarks on Union Budget 2024.

On Union Interim Budget 2024-25, PM Narendra Modi says, "This budget has a reflection of the young aspirations of a young India. Two important decisions were made within the Budget. For research and innovation, a fund of Rs 1 Lakh Crore has been announced..."

This Budget has kept fiscal deficit in check, but has also given a high allocation to capital expenditure: PM Modi

This budget was "innovative and inclusive". Budget will empower all sections of the society. This Budget has focussed on empowering poor and the middle class, he added.

PM Modi: This Budget lays down foundation to become Vikshit Bharat by 2047. This Budget shows continuity and confidence.

On Union Interim Budget 2024-25, Ashish Chauhan - CEO National Stock Exchange of India (NSE) says, "The Interim Budget has stuck to the winning formula that I think the current government has figured out - fiscal restraint with welfarism and growth...So, overall it is a 10/10 budget. It is just an interim budget, the actual budget will be presented after the election but they want to stick to their winning formula they have figured out over last 10 years."

“It’s a very prudent budget, which lays down the foundation for a very strong path for India,” says CII Director General Chandrajit Banerjee on Union Budget 2024.

On Interim Union Budget 2024-25, Union Minister Jyotiraditya Scindia says, "This is a historic budget...India has now moved forward. 'Yahi samay hai, sahi samay hai'..."