FinMin concludes pre-Budget talks with 120 invitees, 10 stakeholder groups | Economy & Policy News
The Finance Ministry concluded the pre-budget consultations with ten stakeholder groups, including experts and representatives from agriculture, education, health, micro, small and medium enterprises (MSME), energy, and infrastructure sectors, among others, on July 5, a press statement issued on Sunday said.
The in-person consultations with more than 120 invitees started on June 19 and highlighted the concerns around jobs and growth for the upcoming budget. The first full budget of the BJP-led National Democratic Alliance, which returned to power for the third time in June, would be presented on July 23.
Finance Minister Nirmala Sitharaman chaired a meeting with finance ministers of different states and union territories to get their suggestions for Budget 2024-25 last month.
Staying on the fiscal consolidation path and extending the Product Linked Incentive (PLI) scheme to small and medium enterprises and labour-intensive sectors to create jobs and boost consumption were among some of the key suggestions the finance minister has received to address the immediate economic concerns of the country.
Industry representatives have emphasised the need to take measures for job creation and provide budgetary support to encourage students and professionals to pursue GenAI courses in their discussions with the finance minister.
Enhancing PM-KISAN support to Rs 8,000 per year from the existing Rs 6,000, more funds for agriculture research, and the transfer of all subsidies to farmers through direct benefit transfer is also on the table for the upcoming budget. The demand for this increase by farmer associations came in the backdrop of a rather subdued performance of the ruling BJP in rural areas in the general elections.
The trade unions have demanded the restoration of the Old Pension Scheme and the scrapping of the four labour codes. They have suggested stopping the privatisation of public sector undertakings as well.
Industry bodies have also asked the finance minister to consider increasing the capital expenditure by 25 per cent from the revised estimate to provide the space to deploy additional resources for rural areas—housing, agriculture, warehousing, irrigation, etc. The increased capital expenditure, they have argued, would give impetus to jobs in rural areas and therefore fuel demand.
The upcoming budget would be closely watched to see how the finance ministry decides to deploy the bumper Reserve Bank of India (RBI) dividend of Rs 2.11 trillion, which has provided the government with a fiscal cushion and enough elbow room to manage expenditure expectations.
The government had set the FY25 fiscal deficit target at 5.1 per cent or Rs 16.85 trillion of the gross domestic product (GDP) and revised the FY24 target to 5.8 per cent from the earlier projection of 5.9 per cent. The fiscal deficit narrowed further to 5.6 per cent in FY24.
The pre-budget consultations were attended by the finance minister’s budget team, including T V Somanathan, finance secretary; Ajay Seth, secretary, economic affairs; DIPAM secretary Tuhin K. Pandey; secretary, financial services, Vivek Joshi; revenue secretary, Sanjay Malhotra; chief economic adviser, V. Anantha Nageswaran; and other senior officers.
First Published: Jul 07 2024 | 4:36 PM IST
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