Finance And Manufacturing Sector Seek Budget Boost To Drive Self-Employment

As the government prepares to unveil its Union Budget in July, all eyes are on the potential reforms and initiatives that could shape India's economic landscape in the coming years

As the NDA-led Modi government embarks on its third term, anticipation mounts for the upcoming Union Budget presentation scheduled for mid-July. Analysts and industry leaders are speculating on potential measures that could be introduced, balancing populist demands with growth-oriented reforms.

As the government prepares to unveil its Union Budget in July, all eyes are on the potential reforms and initiatives that could shape India's economic landscape in the coming years. According to analysts, the Budget for 2024-25 should focus on employment generation, besides promoting the manufacturing sector, economists attending the pre-Budget consultation meeting with Finance Minister Nirmala Sitharaman.

Finance sector 

Shruti Jain, chief strategy officer at Arihant Capital, commented, "Expectations are high for populist measures due to the coalition government. However, no one can be certain of the exact outcomes. This Budget will focus on balancing reforms and growth." Key measures anticipated include supply-side reforms, boosting manufacturing, implementing labour laws, enhancing skill development, and creating employment opportunities, particularly in low-skilled, labour-intensive manufacturing sectors.

The government is also expected to continue its fiscal consolidation efforts by increasing revenue, focusing on boosting rural spending, and prioritising infrastructure capital expenditure. There will be a strong emphasis on the defence and agriculture sectors, alongside the strategic sale of central public sector enterprises (CPSEs) such as Shipping Corporation, NMDC Steel Ltd, IDBI, BEML, HLL Lifecare, and PDIL.

Chakrivardhan Kuppala, co-founder and director of Prime Wealth Finserv Pvt Ltd, noted the importance of economic recovery through increased infrastructure spending and robust support for Micro, Small, and Medium Enterprises (MSMEs). "In the mutual funds sector, with Assets Under Management (AUM) growing to Rs 57.26 lakh crore as of April 2024, there is a need for policies that boost investor confidence, including tax incentives, regulatory clarity, and promoting financial literacy," Kuppala said. He also highlighted the significance of sustainable growth through environmental, social, and governance (ESG) investments.

MSME sector

Dhwani Mehta, founder and director of OpportuneHR, underscored the critical role of MSMEs in the economy, noting that the sector comprises over 6.3 crore enterprises. "MSMEs foster entrepreneurship and generate self-employment opportunities. As we look forward to the next fiscal Budget, we hope for additional reforms to enhance MSME growth and resilience," Mehta said. He called for measures to protect MSMEs from external risks such as cybersecurity threats, economic shocks, and supply chain disruptions, as well as advocating for the adoption of best practices in data security and risk management.

Mehta also stressed the need for streamlining regulatory processes and reducing bureaucratic hurdles for MSMEs. "We hope Modi's third term will foster collaboration between government, academia, and the private sector at the grassroots level, creating a more supportive ecosystem for MSMEs. These measures will be instrumental in ensuring future sustainable growth and resilience for MSMEs," he added.