As India gears up for the Lok Sabha elections, all eyes are on Finance Minister Nirmala Sitharaman as she prepares to unveil the interim budget on February 1, 2024. This crucial budget, marking the end of the current government’s term, is anticipated to introduce populist measures aimed at appealing to voters. The budget preparations began with the traditional halwa ceremony on January 24 at the North Block, signaling the start of the budget document compilation process. The ceremony was attended by key figures including Finance Minister Sitharaman and the Union Minister of State for Finance, Bhagwat Kisanrao Karad.
Amid expectations of robust economic growth, the Finance Ministry projects that FY24’s growth will surpass the central bank’s forecast of 7%, maintaining a similar momentum into FY25 despite potential challenges from geopolitical tensions and inflation risks. The Ministry’s optimism extends further, forecasting India’s elevation to a $7 trillion economy by 2030, aiming for a $5 trillion economy status within the next three years. These projections underline the government’s broader vision to transition India into a developed nation by 2047, reflecting ambitious economic targets set against a backdrop of global uncertainties.
The interim budget, crucial for managing the government’s immediate financial needs, serves as a provisional grant allowing the government to manage expenses until the fiscal year commences in April. Unlike a full budget, which is comprehensive and includes detailed policies and tax proposals, an interim budget focuses primarily on essential expenditures without proposing new taxes, adhering to constitutional mandates to ensure financial operations continue smoothly during election periods. This strategic financial planning is vital to maintain stability and continuity in governance, especially in an election year, ensuring that the government retains the ability to function effectively while awaiting the newly elected government’s comprehensive budget proposals.