India’s upcoming Union Budget is anticipated to maintain its focus on fiscal consolidation, macroeconomic stability, and increased investment in high-technology sectors, according to Anit Mukherjee, Senior Fellow at ORF America. Mukherjee highlighted the government’s likely continuity in policies rather than significant shifts in the upcoming budget, considering it as the midpoint of the government’s term.
Recent announcements indicate an incremental approach, such as the restructuring of India’s major social benefit program towards livelihoods rather than solely direct benefits transfer. Despite recent cuts in the goods and services tax (GST), Mukherjee expects strong revenue growth and stability in the external sector, offering room for cautious optimism amid evolving global trade patterns.
Mukherjee suggested that a potential shift in India’s trade partnerships could benefit the country, especially if trade reorientation occurs away from traditional groupings towards other partners. Emphasizing the importance of core macroeconomic objectives, he anticipates the finance minister’s focus on fiscal consolidation, managing inflation, and sustaining public investment in emerging high-technology sectors where India’s competitiveness is evident.
Discussing changes in the rural employment program, Mukherjee welcomed the modernization efforts, providing states with more autonomy in implementation while maintaining the program’s original intent of providing employment during critical periods. He also addressed the impact of US trade tariffs on India, noting the immediate effects felt and expressing optimism about the potential for a bilateral free trade agreement.
