Budget 2024 retains focus on capex, infra creation for a foundation of New India
The central government led by Narendra Modi is determined to further strengthen the country’s economy and development. This time the Union Budget is positive for the real economy as it focuses on rural sector, agricultural development, employment generation, skill development of job ready youth and basic infrastructure to increase the productive capacity of the economy. Best of all, all these major initiatives have been taken for the market while reducing government borrowing this year, including bringing the fiscal deficit down to 4.9 percent of GDP. Which is a good thing. Because along with reducing the loan, the Narendra Modi government has taken a positive decision for the grassroots.
Employment promotion schemes and programs for women are expected to boost overall consumption, along with exemptions from high income taxes, as well as reductions in import duties on gold, silver, mobile phones and electronics. Whereas direct (direct tax) tax will increase the money in the hands of the earners even after paying the tax. Spending on employment programs can put more money in the hands of the country’s youth.
India’s consumer goods companies and two-wheeler makers benefited after the budget announcements. Underlying primary infrastructure in some states has also helped focus investment. Due to reduction in tax on gold and silver, stocks of jewelers have also risen. Share prices of tobacco companies rose even as no additional tax was announced in the budget.
Abolition of angel tax in the budget will benefit the country’s start-up sector. This tax is levied on funds raised by the start-up at a price higher than the fair market price. This will boost the start-up scene in the country.
Gains were seen across major stocks ranging from defense to railways, property developers to construction companies, buoyed by bright future forecasts. Thus the budget is positive and this will boost the growth of the economy. So in the end the market will also get help.
