iifl-logo

Invest wise with Expert advice

By continuing, I accept the T&C and agree to receive communication on Whatsapp

sidebar image

Interim Budget Reaction: CareEdge Ratings

1 Feb 2024 , 05:42 PM

“The Finance Minister has focused on fiscal prudence, budgeting a fiscal deficit to GDP ratio of 5.1% for FY25, much lower than market expectations. The tax buoyancy of 1.1 assumed for the fiscal calculation looks quite reasonable. Even while focusing on fiscal discipline, the FM has continued with the mantra of capex led growth. The capex has been budgeted to grow by 11% to Rs 11.1 lakh crore in FY25. The capex to GDP ratio is budgeted to increase to 3.4% in FY25 as against less than 2% in the years before the pandemic. There continues to be large focus on roads and railways as per the budget allocation. Despite being an election year, the government’s continued commitment to productive capital expenditure, even at the expense of revenue expenditure, is a welcome move. The overall subsidy outgo has reduced in FY25, mainly due to reduction in fertilizer subsidy.

A reduced gross borrowing in the fiscal year 2024-25, anticipated interest rate reductions by the Reserve Bank of India, and an increase in passive inflows into the debt market following India’s inclusion in global bond indices, are poised to result in a lower cost of borrowing for the entire economy. This could catalyse private capex going ahead. The corpus allocated for long term interest free loan for innovation and R&D for private sector is also a step in the right direction. This will enable India to move to high value added segment in the sunrise sectors. The budget has also looked at other pivotal areas such as rural development, housing, education, tourism, technology, green energy, empowerment of youth and women.”

Related Tags

  • Budget 2024
  • Budget 2024-25
  • Interim Budget
sidebar mobile

BLOGS AND PERSONAL FINANCE

Read More
Knowledge Center
Logo

Logo IIFL Customer Care Number
(Gold/NCD/NBFC/Insurance/NPS)
1860-267-3000 / 7039-050-000

Logo IIFL Capital Services Support WhatsApp Number
+91 9892691696

Download The App Now

appapp
Loading...

Follow us on

facebooktwitterrssyoutubeinstagramlinkedintelegram

2025, IIFL Capital Services Ltd. All Rights Reserved

ATTENTION INVESTORS

RISK DISCLOSURE ON DERIVATIVES

Copyright © IIFL Capital Services Limited (Formerly known as IIFL Securities Ltd). All rights Reserved.

IIFL Capital Services Limited - Stock Broker SEBI Regn. No: INZ000164132, PMS SEBI Regn. No: INP000002213,IA SEBI Regn. No: INA000000623, SEBI RA Regn. No: INH000000248
ARN NO : 47791 (AMFI Registered Mutual Fund Distributor)

ISO certification icon
We are ISO 27001:2013 Certified.

This Certificate Demonstrates That IIFL As An Organization Has Defined And Put In Place Best-Practice Information Security Processes.