Budget 2023: All You Need To Know About Ahead Of Nirmala Sitharaman's Fifth Budget
Union Budget 2023 will be the 11th budget presented by Prime Minister Narendra Modi's government.
Union Budget 2023 will be the 11th for Prime Minister Narendra Modi's government, including an interim budget ahead of the general election year of 2019. This will be Finance Minister Nirmala Sitharaman's fifth budget presentation.
She will begin her budget speech in Lok Sabha at 11:00 a.m. on Feb. 1. You can watch it on the BQ Prime website or on any of our social media platforms, including here on YouTube.
Union budgets in India are often more than just a presentation of key financial metrics—revenue, expenditure, deficit...
This will be the last full-fledged budget of the Modi government before the 2024 general election.
The run-up to the budget is filled with demands from the industry and taxpayers on changes necessary—though this has reduced somewhat since the Goods and Services Tax was introduced and the annual tinkering of indirect taxes curtailed. In the direct taxes, there is expectation of some changes on the personal income tax front.
Budget 2023 will be presented against the backdrop of renewed uncertainties around global and domestic growth, and tighter financial conditions.
Macroeconomic Expectations
Nominal GDP Growth
The government had estimated a nominal GDP growth of 11.1% in 2022-23 (that is real growth plus inflation). Against that backdrop, a number between 10.5% and 11.5% is estimated. A number much higher or much lower may be out of sync with market expectations or beliefs.
Fiscal Deficit
The consensus is to expect a lower figure in the budget estimate for FY24 versus 6.4% for FY23. Most economists and experts that we spoke to expect a number of 5.9%. If it's below the 6% mark, it will show that the government is serious about maintaining fiscal discipline.
Subsidies
Food subsidy in FY23 was Rs 2.9 lakh crore, including Rs 1.5 lakh crore for free food. There is an expectation that the food subsidy as a percentage of GDP would be lower in the FY24 estimates, with no expansion in scope envisaged. Similarly, fertiliser subsidy, which overshot FY23BE of Rs 1.1 lakh crore to more than Rs 2 lakh crore, is expected to moderate.
Market Borrowings
Most experts expect FY24 net borrowings to be around Rs 12-12.5 lakh crore, compared with Rs 9.3 lakh crore in FY23. This would mean that around two-thirds of the fiscal deficit will be funded by market borrowings. Keep in mind that the scope for going for an out-and-out populist texture to the budget looks bleak amid the heavy market borrowing in addition to the moderating tax revenue in FY24.
What Brokerages Expect From The Budget
Ahead of the budget, many brokerages are expecting policy announcements to boost their sectors.
