The quality of fiscal consolidation has improved as has capex push, but the newly-elected government needs to strike a balance on the financial assistance going to alliance parties and the path towards reaching fiscal deficit targets
As the BJP-led alliance attempts to fulfill its mandate after a victory in the recently-concluded general elections, the focus shifts on how finance minister (FM) Nirmala Sitharaman will—in the upcoming Union Budget—strike a balance between pushing for sustained economic growth, arresting fiscal deficit and provide the impetus to jobs and rural demand.
India’s pace of growth is a startling 8.2 percent for FY24, but unemployment continues to rise and private consumption expenditure is at a multi-year-low. An erratic monsoon in 2024 could threaten crop sowing and output.