The 2024-25 Budget is likely to lay out Modi 3.0 government’s economic agenda.
The finance minister will have to look at measures to boost growth without hurting inflation as well as look for resources to meet the coalition government’s compulsion
New Delhi: Finance Minister Nirmala Sitharaman is likely to hold pre-budget consultations with industry chambers on June 20, sources said.
The budget for 2024-25 fiscal is likely to be presented in Parliament in the second half of July.
Industry sources said the pre-budget consultation with Sitharaman would be preceded by a meeting with Revenue Secretary Sanjay Malhotra on June 18.
Meanwhile, the GST fitment committee to likely to be convened ahead of the GST Council meet scheduled for June 22. The 53rd GST Council, which convenes on June 22, could take decisions on several issuers including rationalisation of GST on health insurance. At present, a GST of 18 per cent is applicable on all health insurance policies and there is a demand from the insurers to bring it down to 12 per cent with in put credit or 5 per cent without input credit.
Indian general insurers are also waiting keenly for the GST Council meet to get some clarifications over issues for which they were served show cause notices by the GST authorities for allegedly not paying the relevant taxes on coinsurance deals and reinsurance commissions for five years from July 2017 till March 2022.
Earlier, the insurers had met Malhotra, who had advised them to wait for the next GST Council meeting for any clarifications on this technical issues.
The 2024-25 Budget is likely to lay out Modi 3.0 government’s economic agenda.
The finance minister will have to look at measures to boost growth without hurting inflation as well as look for resources to meet the coalition government’s compulsion.
Income tax relief for the people in the lowest slab may need to be considered in the upcoming full Budget for 2024-25 considering the high levels of inflation, according to newly-elected CII President Sanjiv Puri.
In an interview with PTI, he also suggested creation of an institutional platform for consensus building between the Centre and states to successfully carry out all reforms, including those related to land, labour, power and agriculture.
The industry body also said it does not see compulsions of coalition politics hampering the reforms in the third term of Prime Minister Narendra Modi. In stead, it believes that the performance of Indian economy and the success of policies in the previous two stints would set the base to accelerate the process.
“Broadly, I would say at this point of time it is public capex, adherence to fiscal glidepath, roadmap for investment in the social infrastructure, green fund and greater investment in the rural sector. These are the broad principles,” he said, when asked about CII’s expectations from the upcoming full Budget for 2024-25.
The economic agenda would include steps to fast-rack reforms to make India a USD 5-trillion economy in near future and turn the country into a ‘Viksit Bharat’ by 2047.
The Indian economy is projected to grow 7.2 per cent in the current fiscal on the back of improving rural demand and moderating inflation, as per RBI estimates.
The Modi 3.0 government inherits a strong economy with fiscal prudence in place. Icing on the cake is a bonanza from RBI which has announced the highest-ever dividend of Rs 2.11 lakh crore for FY24.
The key policy priorities for the third term of Prime Minister Narendra Modi-led government would include dealing with stress in the agriculture sector, job creation, sustaining capex momentum and pushing revenue growth to stay on the fiscal consolidation path.
Rating agency S&P has already given a thumbs up to economic policies followed by the Modi regime in the past 10 years by upgrading the sovereign rating outlook to positive. It also hinted at a possible rating upgrade in next 1-2 years provided the government sticks to its fiscal deficit roadmap.
While tax revenues seem to be buoyant, non-tax revenue remains a challenge as strategic disinvestment has almost been a non-starter with no big-ticket strategic sale, except Air India.