Budget Expectations in India 2024

The Finance Minister of India, Nirmala Sitharaman is ready to unveil the Union Budget 2024 on July 23. This will be the NDA's first Budget following their recent Lok Sabha election win in 2024. 

With anticipation building across various sectors, the country keenly looks forward to the government's economic roadmap for the upcoming year.

The Union Budget 2024 is expected to introduce key policies, ranging from possible tax reforms to enhanced infrastructure investment, which will significantly influence India's economic future.

Here, you will explore some of the budget 2024 expectations.

Budget Expectations from Union Budget 2024

As per the experts, the following are some of the primary expectations in Union Budget 2024:

• Continuation of Existing Policies

A significant expectation is the continuation of current economic policies.

The coalition government has received praise for stabilising the economy by boosting growth, streamlining business transactions and attracting foreign investments.

Investors want these rules to stay the same to ensure a stable and predictable economic environment. This consistency is important for keeping investor confidence high and encouraging long-term investments in the stock market.

• Green Economy

Individuals need swift government action on project approvals and supportive policies for green energy projects.

Some anticipated measures include financial support for sustainable startups, promotion of organic farming, and incentives for green practices such as solar energy adoption and plastic reduction. These initiatives are expected to drive progress in the green and blue economies.

• Fintech Industry

The fintech sector hopes the budget will support its growth by clarifying interchange fees on UPI, providing tax incentives and credit access for startups and establishing an 'India Fintech Credit Fund' to offer affordable capital.

Additional support for women in tech and regulatory backing for blockchain and asset tokenisation is also anticipated.

• Real Estate Sector

The real estate industry is looking for renewed support for affordable housing. Key expectations include reinstating incentives like the Credit-linked Subsidy Scheme (CLSS) and offering targeted tax breaks.

These measures aim to stimulate demand and encourage developers to focus on affordable housing, which is crucial for economic stability and social equity.

• Education Sector

The education sector hopes for an increase in the tax exemption limit under Section 80(C) of the Income Tax Act from ₹1.5 lakh to ₹2 lakh, with a focus on greater tax benefits for tuition fees. This move aims to help parents afford high-quality education for their children, thereby improving access to world-class educational facilities and fostering global competence.

Moreover, increased funding and supportive policies for digital learning tools and platforms are expected.

• Telecom Sector

The telecom industry is at a critical point. It needs the budget to address high spectrum costs and rural infrastructure deficits.

Key expectations in this sector include rationalised GST rates on telecom services and equipment, substantial investments in cybersecurity and incentives for digital literacy to strengthen and secure communication networks.

• Agriculture Sector

The agricultural sector, crucial to the Indian economy, has faced a tough year due to erratic monsoons, leading to reduced growth and increased rural distress.

Therefore, the Budget should prioritise agriculture and rural areas by making farmers more resilient and addressing food inflation, benefiting society's underprivileged segments.

• Railway and Defence Sectors

Both the railway and defence sectors are looking for substantial budgetary allocations. Modernising defence capabilities is crucial for national security, while increased investment in railways is essential for enhancing supply chains and logistics, leading to greater economic efficiency.

The stock market expects significant commitments in these areas, which could benefit businesses operating in these sectors.

• Climate Change and Sustainability

There is a strong call for dedicated funds for climate action projects, particularly in response to recent climate events like heat waves.

Investments in community-driven and nature-based projects are crucial to enhance India's resilience against climate impacts.

• Cybersecurity

Cybersecurity stands out as a national security priority. Increased budget allocation, public-private partnerships, and continuous innovation are essential to safeguard India's digital future.

• Infrastructure Development

Substantial resources are expected to be allocated for sustainable and resilient infrastructure projects. Policies that boost private investment enhance connectivity and promote green infrastructure are crucial for India's growth trajectory.

• Waste Management

The waste management sector is expected to be prioritised, with enhanced credit accessibility and outcome-linked tax incentives. A dedicated platform on the Social Stock Exchange could stimulate private investment.

• Retail Sector

The formulation of the National Retail Policy, tax benefits for middle-income earners and continued support for e-commerce are anticipated. These measures could enhance retail spending and digital adoption.

• Insurance Sector

Initiatives that promote inclusive growth in the insurance sector are expected, including composite licences, enhanced capital frameworks and streamlined regulations to foster innovation.

• Income Tax Reforms

Income taxpayers are eager for reforms to simplify compliance:

• Technology Upgrades: The government should enhance systems to automate tax return processes, with better pre-fill options to save time.
• Grievance Resolution: A revamped grievance mechanism is needed to ensure timely and effective resolution of taxpayer issues, reducing delays.
• Faceless Assessment Enhancements: Addressing issues in the faceless assessment scheme, such as compliance deadlines, submission limits, hearing delays and video conferencing problems, is crucial.
• Tax Refund Adjustments: Immediate action is required to prevent unfair adjustments of tax refunds against outstanding demands, ensuring timely refunds.
• Rectification Applications: Accelerating the processing of rectification applications and appellate decisions will improve efficiency and reduce taxpayer concerns.