Interim budget 2024: Industry experts respond on inclusive development, fiscal consolidation and economic growth

Unlock valuable insights into the budget's impact through the perspectives shared by experts

Surpassing Expectations and Navigating Fiscal Consolidation

Dhiraj Relli, MD & CEO, HDFC Securities shares - “The FY25 interim Budget has come out better than expected even though the heightened expectations on many changes/giveaways have rightfully not been met now. The resolve to continue the fiscal consolidation path will be appreciated by global and local investors. Better than street expectations of fiscal deficit for FY24 and FY25 and the consequent lower borrowings target in FY25 has enthused the bond markets. Announcements on Rail infra spend and an 11.1 per cent rise in overall capex would be in line with most expectations. All in all, we think the impact of the interim Budget on equity markets will be neutral to mildly positive for the near term and other emerging triggers will drive its trajectory later.”

Budget Emphasising Fiscal Discipline and Economic Growth

George Alexander Muthoot, MD, Muthoot Finance conveys - “FM’s interim budget is balanced from the point of view of adhering to fiscal prudence, boosting infrastructure growth and prioritizing focus on four key sections of the economy - the poor, women, youth and farmers. We believe the FM’s focus on higher outlay for infrastructure will help boost the broader economy and in the long term will boost investment activity. The government’s support to MSMEs, women entrepreneurs and the agricultural sector aptly aligns with our aim to provide credit support to MSMEs, small business owners, farmers and women entrepreneurs thereby addressing their economic needs. FM’s focus on addressing housing challenges by building two crore additional homes under the PM Awas Yojana-Grameen is certainly positive for boosting the housing sector. While inflation has been a concern globally, FM’s focus on staying on the path of fiscal prudence in the interim budget will surely be an enabler for a stable interest rate scenario in the economy and bodes well for the overall financial sector.”

Bond Market Optimism

Rajeev Radhakrishnan, CIO Fixed Income, SBI Mutual Fund expresses - “A faster than anticipated pace of fiscal consolidation and gross borrowings being lower than market estimates have been the positive features of the budget from a bond market perspective. The cushion from the GST compensation cess has enabled the gross borrowings to be lower at 14.1 tr. A reasonable hike in capex that supports economic growth has been accompanied by achievable estimates on nominal growth and tax buoyancy.”

Stride Towards a USD 5 Trillion Economy

Chandra Shekhar Ghosh, MD and CEO, Bandhan Bank states - “The interim budget focuses extensively on inclusive development and is a step forward in the USD 5 trillion economy aspirations of the nation. The focus on the housing sector will benefit a range of peripheral sectors like cement, paints and, steel, among others, and create employment opportunities. The focus on women empowerment will further boost the economy. The emphasis on infrastructure and rural development will lay a strong foundation for India’s growth story."

Robust Funding for Infrastructure Development

Mahesh Fogla, Executive Director, Patel Integrated Logistics Ltd shares - “The Interim Budget allocates robust funding for Infrastructure Development, emphasizing upgraded roads, doubled airports (149 total), and advanced railroads. A strategic focus on new airport expansion aligns with Indian carriers anticipating 1,000 new aircraft. This plan includes the introduction of 517 new routes under the UDAN scheme, fostering connectivity for tier II & tier III cities. The budget adheres to fiscal prudence, keeping the fiscal deficit in check to reduce borrowing costs. Furthermore, the combination of infrastructure development, potential business support measures, and a focus on supply chain efficiency reaffirm a steadfast commitment to nationwide progress and economic vitality.”