India proposes $576B budget

NEW DELHI

The Indian government Tuesday proposed a budget of $576 billion for the ongoing fiscal year until the coming March.

The budget was proposed to the parliament by Finance Minister Nirmala Sitharaman, the first since the return of Prime Minister Narendra Modi-led government after winning elections for a third term.

Last year, the Bharatiya Janata Party (BJP)-led government had secured a 45 trillion Indian rupee ($537.8 billion) budget.

Sitharaman told the lawmakers that the government has "particularly" focused on employment, skilling, micro, small, and medium enterprises, and the middle class.

Earlier, experts had told Anadolu that India needs to continue to focus on agriculture, defense, education, infrastructure, and social infrastructure.

Jaijit Bhattacharya, the president of the Centre for Digital Economy Policy Research, told Anadolu that India “urgently needs action” for mitigating the impact of “climate change, creating irrigation facilities, enhanced food storage facilities, factory-based food production, flood-resistant cities, etc.”

The government needs to continue promoting local industry through steps such as an increase in the customs duty on products “so that domestic industry grows in such critical areas, and defense will continue to require more investments due to heightened geopolitical challenges,” he said.

In addition, Bhattacharya said money should be allocated to technology creation in India.

Asked if the demands of the coalition partners would be met, Bhattacharya said they “will be met to an extent, as these demands are developmental in nature and would lead to industrial development and job creation.”

The ruling BJP lost its majority in parliament and is supported by smaller parties.

The budget “will continue in the same trend as earlier, with further attempts to reduce the fiscal deficit and strengthen the economy,” Bhattacharya said, adding that “there appears to be food inflation, and there would be steps to address the same.”

“There will also be a focus on strengthening the safety net for the vulnerable sections of society,” he said.

The finance minister also announced assistance to two states -- Andhra Pradesh and Bihar. Two regional parties from these two states are alliance partners of the BJP-led federal government.

India’s real GDP is projected to grow between 6.5% to 7% in 2024-25 and the Indian economy recovered swiftly from the COVID-19 pandemic, the Economic Survey for last year presented Monday in parliament showed.

Economic expert Abhijit Mukhopadhyay told Anadolu that the budget is probably going to be "business as usual.”

There will be “some social welfare schemes (with not-so-generous outlays, but) with lots of propaganda noise and aggressive reform with fiscal consolidation (read lower fiscal deficit targets) by cutting long-term social sector spending in areas like health and education,” he said.

The budget was delayed due to elections in the country as the fiscal year runs from March to March in the South Asian nation. The Modi government had presented an interim budget in February due to general elections.