Pre Budget Expectations 2024 – Univest Edition

As the date for the official presentation of the Union Budget approaches, there’s a hidden sense of excitement and anticipation in India. The interim budget, which is scheduled to be announced on February 1st, is being closely watched by economists, investors, politicians, and the general public alike.

This year’s budget is particularly significant, given that it is being presented during a critical phase of economic recovery and political transition.

There are high expectations and intense speculations about the budget’s scope, direction, and impact on various sectors of the Indian economy.

Here are some budget expectation that we can see:

Fiscal Balancing Act:

Managing the fiscal deficit is a major concern for the government. The Finance Minister faces a challenge in balancing fiscal responsibility with measures that promote growth. Although the government intends to stick to its consolidation plans, concerns about inflation and global economic challenges persist.

Boosting Infrastructure and Employment:

The government aims to achieve a $5 trillion economy and is prioritizing infrastructure development. Plans include increasing funding for roads, railways, renewable energy, and digital infrastructure. The government also plans to address youth unemployment by creating more jobs.

Infrastructure stocks to keep an eye on: L&T, PNC Infratech, Dalmia Bharat, KNR Construction, PNC Infratech, RITES, KEC International, Ahluwalia Contracts, Astral and Tata Power.

Tax Tweaks and Social Welfare:

Income tax reforms are a perennial topic of pre-budget discussions. While major changes are unlikely in this interim budget, some adjustments in slabs, deductions, and exemptions are expected. Additionally, increased allocations for social welfare schemes like the Pradhan Mantri Kisan Samman Nidhi and Ayushman Bharat are being widely anticipated.

Boost for Rural Economy:

The agricultural sector is critical for ensuring food security in India. To support this sector, the Pradhan Mantri Kisan Samman Nidhi scheme may receive increased funding, and crop insurance coverage could be improved. Additionally, investments in rural infrastructure and irrigation projects could empower the agricultural community further.

Rural themed stocks to keep an eye on: Maruti Suzuki, Minda Corp, Hero MotoCorp, M&M, Escorts Kubota Ltd.

Green Push and Technology Focus:

The upcoming budget is expected to focus on two important areas – sustainability and digital transformation. The budget will encourage the use of green technologies, promote the adoption of electric vehicles, and fund renewable energy initiatives. Additionally, the budget will encourage the use of technology across different sectors and support research and development to promote innovation.

Green Energy Stocks to keep an eye on: Adani Green Energy, JSW Energy, NTPC Limited, K.P. Energy LTD

Industry and Manufacturing Support:

The manufacturing industry, which is a significant contributor to economic growth, expects initiatives to improve competitiveness and attract foreign investments. This may involve simplifying regulatory procedures, providing tax incentives, and offering skill development programs.

Manufacturing Industry stocks to keep an eye on: UPL, Dr. Reddy’s Laboratories, ITC Limited, Tata Steel Ltd

Budgets aren’t just about money. They also have an impact on society and the economy. It’s important to consider how policies affect everyone. We need to make sure that benefits are distributed fairly, that rural areas are developed, and that marginalized communities’ concerns are addressed.

The countdown to February 1st is on and people are eagerly waiting for the government to reveal their plans for the upcoming year. This includes everyone from industry leaders to everyday citizens. The budget announcement will impact India’s economic and social direction, especially in the year leading up to the next election.

While we don’t know if the budget will live up to expectations, it’s crucial for the government to set the right tone.