Eye on growth, big announcements ahead of 2024 polls

Budget 2023: Nirmala Sitharaman presents the budget of the Union today

New Delhi:
The budget of the Union for fiscal year 2024, which will be presented by Finance Minister Nirmala Sitharaman, will lay the foundations to bring India’s economic growth to the forecast rate of 6.8 percent. This is Ms Sitharaman’s fifth budget presentation since 2019.

Here’s your 10-point cheat sheet for this big story:

  1. As might be expected, India’s middle class is looking for some form of tax relief. While the tax bracket hasn’t changed and no new deductions were announced last year, inflation has eroded people’s earnings. They have seen no change in the tax rate since 2017-18 and in the tax bracket since July 2014.

  2. Ms Sitharaman may be able to afford a balanced, not a populist budget, as the general election is still a year and another Union budget away. But with Prime Minister Narendra Modi’s BJP hoping to win a third consecutive term, massive welfare programs for farmers and the rural population cannot be ruled out.

  3. The Treasury Department had considered raising the limit below 80C, which would include investments in life insurance, fixed deposits, bonds, housing and a public provision fund. If this happens, it will encourage saving and help raise funds for people whose savings have eroded at the height of the COVID-19 pandemic.

  4. Markets in India – Asia’s third largest economy – will be closely watched as Ms Sitharaman begins her budget speech at 11am. Adani group companies led the most fluctuations last week, but on Tuesday Rs 20,000 crore follow-on share sales sailed through, bringing relief to the group facing allegations of fraud from US-based short-seller Hindenburg.

  5. The Modi government can strengthen its “Make In India” and “Atmanirbhar Bharat” policies by providing financial incentives to manufacturers and suppliers who want to establish themselves in the country. India advertises itself as an alternative to China in the global supply chain.

  6. The real estate sector, which took a nosedive during the pandemic, expects the center to announce favorable arrangements and tax breaks to improve its luck after a slow but sure rebound last year. In 2019, the Goods and Services Tax, or GST, lowered the tax rate on affordable homes from 8 percent to 1 percent. The sector also expects similar announcements in this budget.

  7. More than half of India’s population is under the age of 30. For them, the focus would be on job security and reducing taxes on products they prefer to buy, such as electronic goods. Better conditions for education loans and other forms of financial aid for school and higher education will be closely monitored.

  8. The agricultural sector was going through some tough times in 2022 due to global supply problems, unusual rainfall and flooding, the effects of climate change and the war in Ukraine. Mrs. Sitharaman would probably have something to absorb all these shocks. After all, farmers provide a large and influential voter base.

  9. Ms. Sitharaman can pick up where she left off with “digital rupee” which was first announced in last year’s budget as a possible alternative to cryptocurrencies. Crypto transactions have recently exploded in popularity all over the world, albeit risky as a gray area of ​​regulation exists. The Finance Minister may provide a status update on “digital rupee”.

  10. A Bloomberg overview of what to expect includes extending long-term capital gains taxes to real estate and privately held stocks, compensating oil retailers for selling fuel below market price, cutting import taxes on gold to 10 percent to deter illegal shipments. curb and increase defense budget amid border tensions with China.

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