Nirmala Sitharaman Interview highlights: FM links rupee strength to economy, says gold demand driven by global uncertainty

Finance Minister Nirmala Sitharaman said actor-politician Vijay is not a concern for her, adding that if he poses a political threat, it is the ruling DMK that would be worried. She said the DMK appears insecure as the NDA gains ground in the state.

Sitharaman also questioned the Congress party’s relevance in Tamil Nadu, describing it as a “divided house” in the state.

Finance Minister Nirmala Sitharaman termed Tamil Nadu Chief Minister M K Stalin’s claim that the state has been ignored in the Budget a “sad commentary”, arguing that multiple infrastructure and welfare measures directly benefit both Tamil Nadu and Kerala. She pointed to super-fast and high-speed rail projects, rare earth corridors and support for coconut farmers as examples of ongoing and planned initiatives.

Sitharaman also highlighted allocations under schemes such as the Viksit Bharat initiatives and MNREGA, along with funding for semiconductors and electronics, saying these sectors and projects have a visible presence in Tamil Nadu. She added that election-bound narratives should not overshadow broader national allocations and maintained that the Budget’s provisions extend benefits across states rather than excluding any particular region.

The government’s focus on artificial intelligence is to raise productivity across sectors, with MSMEs expected to be among the biggest beneficiaries. FM said that AI is also gaining importance in the “orange economy” and is helping authorities better track money trails.

Sitharaman said that AI is being widely used in agriculture and crop technologies, and highlighted that the government has set up institutions of excellence for AI in agriculture and healthcare to drive innovation and adoption.

Once the Cabinet has taken decisions on disinvestment, it becomes the government’s responsibility to honour and implement those commitments. She underlined that policy continuity and credibility remain central to the government’s disinvestment approach.

FM Nirmala Sitharaman said she is seeing “green shoots” in private sector capital expenditure, noting that the situation is improving and there are clear reasons to believe private capex is beginning to pick up.

Finance Minister Nirmala Sitharaman said any move on consolidation of public sector banks will depend on the recommendations of the concerned committee, adding that it would not be appropriate for her to pre-empt its findings.

Finance Minister Nirmala Sitharaman said Leader of the Opposition Rahul Gandhi often “shoots from the hip” and does not rely on strong foundational data while making his points. She criticised his earlier “dead economy” remark, saying it was made in haste and weakened his own argument.

Sitharaman added that such comments are frequently made without adequate basis and said India deserves a more credible and data-driven Opposition voice.

Finance Minister Nirmala Sitharaman said the rupee’s position must be viewed in the broader context of the economy, noting that a weak currency becomes a concern only when the underlying economy is fragile. She added that with the Indian economy currently strong, she would not frame the discussion in terms of personal comfort but emphasised the importance of overall economic stability.

On rising gold demand, Sitharaman said global uncertainties are pushing investors toward time-tested safe-haven assets, which is driving sustained interest in bullion.

• Complete customs overhaul highlighted as a key signature reform of the Budget
• Inflation not a major worry at present
• Confidence in sustaining long-term real GDP growth
• Nominal GDP strength linked to higher capital inflows
• Attracting more global funds seen as a crucial growth driver for India

Finance Minister Nirmala Sitharaman said the government’s priority is to underline the stability of the Indian economy while improving ease of doing business. She stressed the need to “extend the red carpet and remove the red tape” simultaneously, adding that calling the Budget “visionless” reflects a misunderstanding. Sitharaman said reforms will continue even beyond the Budget.

FM: Domain experts have said Indian economy’s fundamentals are absolutely strong. The extent of the impact on decision making an order we have not seen before. We had to keep that uncertainty in mind. What is going to be this year. And what is going to happen in the next five years. It was for us to keeping mind to planned for this year, five years for the finance commission, and Viksit Bharat goals. It is not just tax proposals that will take us to 2047 goals.

Responding to questions on revenue strategy, Sitharaman said divestment will remain a priority as the government works toward achieving a 50 percent debt-to-GDP target by FY31, alongside efforts to broaden the tax base and boost direct tax collections.

Finance Minister Nirmala Sitharaman said the pace and direction of disinvestment will play a key role in revenue generation in the coming years. She noted that divestment of Central Public Sector Enterprises will be “seriously considered” going ahead.

Addressing swings in gold prices, Sitharaman attributed the volatility to global economic and geopolitical stress rather than domestic policy. She said investors naturally turn to gold as a store of value when confidence in major currencies weakens, with prices remaining elevated amid sustained global risks.

Amid concerns over trading volumes, Sitharaman reiterated that the intent behind raising STT on equity futures and options was to curb excessive speculation and safeguard small investors. The Budget proposes increasing STT on equity futures from 0.02 percent to 0.05 percent and on options premium from 0.1 percent to 0.15 percent.

The finance minister emphasised that derivatives trading alone cannot determine global investors’ appetite for India. Long-term capital flows, she said, are guided by growth prospects, policy stability and overall economic fundamentals, not short-term trading costs.

Responding to questions on the STT hike, Sitharaman said the government cannot remain a “mute spectator” when retail investors are consistently losing money in the futures and options segment. She added that the tax move was aimed at investor protection rather than discouraging foreign funds.

Finance Minister Nirmala Sitharaman said fears that the Budget’s increase in Securities Transaction Tax on equity derivatives could lead to foreign investor outflows are overstated. She stressed that investment decisions in India are driven by broader macroeconomic and structural factors, not a single tax change.