Budget 2019: 10 things to look out for in Nirmala Sitharaman’s first budget

Updated on May 28, 2020 06:28 PM IST

The first budget of the Narendra Modi government’s second tenure, which he won with a massive mandate, is expected to be a precursor of major economic reform with an objective to make India a $5 trillion economy by 2024, about double its current size.

Hindustan Times, New Delhi | By

Union finance minister Nirmala Sitharaman will have her eyes on maintaining a balance between the needs of the economy and fiscal constraints in her first Budget on Friday.

The first budget of the Narendra Modi government’s second tenure, which he won with a massive mandate, is expected to be a precursor of major economic reform with an objective to make India a $5 trillion economy by 2024, about double its current size.

WATCH:Mint Budget Round-Table: How Modi govt can achieve $5 trillion economy aim

 

Here’s what Nirmala Sitharaman is expected to announce:

* It could see structural policy changes in areas such as land, labour, capital and entrepreneurship to attract investment, offer incentives to boost consumption, and spend public money on social infrastructure for equitable growth.

Budget 2019 Live Updates: Nirmala Sitharaman arrives in Parliament, will present budget shortly

* The minister is expected to boost spending at the cost of short-term slippage in fiscal deficit targets as she lays down the Modi government’s road map for the economy and the nation for the next five years.

* She may give relief to the common man by raising personal income tax threshold for certain categories while at the same time, upping spending on agriculture, healthcare and social sectors.

* Experts say the government could undertake a major infrastructure expansion programme that could be partially funded through budgetary resources and partially through extra-budgetary resources.

Also read: Budget 2019 Live Updates: Ahead of budget 2019, Sensex up by 119 points in early trade

* The Budget might take some key decisions to boost the real estate sector which could have a multiplier effect on the economy as it would spur demand for steel, cement and labour, particularly in the unorganised sector.

* A big push for infrastructure spending, including on roads and railways to drive growth which had slowed to a five-year low of 5.8% in the first three months of 2019 -- well below China’s 6.4%, is also expected.

* There could be further stimulus measures to boost the growth through new policy initiatives and continued reforms to achieve accelerated growth and increase in employment.

* Sitharaman’s budget may incentivise job-oriented private investment and focus on skill-development initiatives, the government is likely to persuade banks, particularly public sector ones, to slash interest rates in order to boost consumption.

For full budget coverage log on to livemint.com

* The government will be focused on the rural economy for boosting consumption in the short term through the income transfers under PM-KISAN, which would add to farmers’ disposable income, and in the medium term, the government’s productivity-enhancing efforts to double farmers’ income by 2022.

* The government may sell stakes in state-run companies to help boost revenue. Last year, it raised 850 billion from selling assets such as Coal India Ltd and Bharat Heavy Electricals Ltd.

(With agency inputs)

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