Finance minister P Chidambaram will try to strike a balance between fiscal management and populism in his budget, to be unveiled in Parliament later this month.
In the last budget before the general elections slated for 2014, the finance minister is expected to dole out new social welfare measures even though the ministries are not expected to get any substantial increase in the funds meant for major flagship schemes.
Sources in the government are optimistic that Chidambaram would have something for the farmers, who have gone through a rough patch in the past year due to drought in several states. The offering is likely to include more time for farmers to pay back loans and lower interest rate for those who pay on time.
The government had announced a loan waiver for farmers before 2009 elections.
Such a bonanza would not be offered considering the government's fiscal constraints and the finance ministry's bid to further improve India's investment climate in the next few months.
A probable way in mind of the government budget managers is by taking technology to remote villages.
The finance ministry has allowed expenditure of Rs 17,000 crore in the next financial year to ensure that every gram panchayat - a group of few villages - in India is on broadband network by end of 2013.
An ambitious scheme to connect 2.5 lakh gram panchayats was launched during the UPA-2 regime and the government wants to harness its political benefits before elections.