FM Nirmala Sitharaman on mid-term budget 2024 says government basically voted as it should have

Finance Minister Nirmala Sitharaman on Thursday said the government has largely retained the vote of record and the interim budget 2024-25 has already laid out plans for the sectors that we will focus on in the July budget. She said India’s economy was better managed with the right intentions and policies.

Addressing the media after unveiling the mid-term budget 2024-25, Finance Minister Nirmala Sitharaman said: “This is the mid-term budget presented before the elections. I would like to draw attention to GDP – governance, development and performance. I would like to outline what we are doing in Achievements in these three areas.”

She also said that India has achieved 7% growth for three consecutive years. She highlighted the government’s performance over the past 10 years. “Our economy is better managed, with the right intentions and the right policies,” she added.

Sitharaman said despite facing challenging times, the government has reduced the fiscal deficit in a prudent and transparent manner. Inflation management, handling the economic impact of COVID-19, using DPI to boost economic growth and cleaning up the banking system are all examples of the government’s performance, she added.

Sitharaman said the fiscal deficit target of 5.1 per cent of GDP in 2024-25 clearly shows that we are on track to achieve or fall below 4.5 per cent in 2025-26.

The finance minister highlighted five disha nirdashak baatein (pathway demonstration points) – 1. Social justice as an effective model of governance, 2. Focus on the poor, youth, women and Annadata (farmers), 3. Focus on infrastructure, 4. Leveraging technology Improving Productivity, 5. High Commission on Addressing Challenges posed by Demographic Challenges.

Bihar, Jharkhand, Odisha, West Bengal, Chhattisgarh and West Bengal will be the growth engines, she said.

She also said the government would publish a white paper on the economic performance of the past 10 years and the previous 10 years. She also termed the next 25 years as “Kartavyakaal” and was called Amrit Kaal by the government.

Responding to a media query, Sitharaman said that our budget estimates are always realistic. “This is our realistic and somewhat conservative estimate.”

In terms of capital expenditure, the Finance Minister said that capital expenditure increased by 11%, with a high base. “And we can see signs that the private sector is getting on board as well.”

Meanwhile, regarding the tax-to-GDP ratio, Finance Minister TV Somanathan said that the target of reducing the Centre’s debt-to-GDP ratio to 40 per cent was set before the COVID-19 period. He added that the relevance of the target must now be reviewed. He further noted that the target of reducing the Centre’s debt-to-GDP ratio to 40 per cent has become a thing of the past.

Regarding disinvestment, Disinvestment Minister Tuhin Kanta Pandey said that we do not have a fixed target for FY25. That’s why we keep the “Other Receipts” column. If given the chance, we can even surpass this goal.

“Study the outline of the urban housing scheme. Currently we have given a nominal amount and once the outline is ready, we will decide on the source of funding for the scheme,” Finance Minister TV Somanathan said in response to media queries.

Sitharaman said every rating agency should realize that we have not only reduced the fiscal deficit but also improved fiscal consolidation. She added that the simple and direct message for every rating agency is that we are not only consistent with the fiscal consolidation road map we have given before, but we are constantly improving.

Sitharaman clarified at the post-budget press conference that new manufacturing units implemented after March 2024 will not continue to enjoy lower tax rates.