Executive Summary

It is with pleasure that we share our analysis of the Union Budget for FY25.

In our opinion, the budget of July 2024 is not merely a statement of accounts and measures for the current fiscal but is a roadmap for the economic and fiscal policies to be pursued over the next five years. As in the previous ten years, the current Government is unlikely to opt for any significant increase in social subsidies under normal circumstances and this has been reinforced in the current year. The commitment to fiscal consolidation is visible as also the intent to simplify and rationalize the taxation structure. Priority has been given to longer term objectives of building a robust manufacturing sector and generating employment. The budget arithmetic is fairly credible with realistic growth assumptions on tax revenues and the achievement of a 4.9% fiscal deficit target is not likely to be a struggle. Overall, we consider this budget to be an important and consistent step towards the goal of Viksit Bharat.

Suman Chowdhury
Chief Economist & Head of Research, Acuité Ratings & Research