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Modi’s administration is expected to publish India’s budget in mid-July following a stunning election in which he lost a majority and returned to power with partners.
Modi’s first major policy pronouncement in his third term, the budget, is likely to outline probable changes to India’s economic goals for the following five years under the coalition administration.
Government sources say Indian Finance Minister Nirmala Sitharaman may decrease personal tax rates for some groups while meeting the budget deficit objective.
Industry groups have made these budget requests.
Consumption boost
The Confederation of Indian Industry (CII) advocacy organization suggested tax cuts in India’s lowest income levels to boost consumption.
Consumption expanded half as fast as the world-beating 8.2% Indian GDP in 2023-24. CII advised the government to raise wages in its sole rural employment guarantee initiative and boost farmer cash transfers.
Limits on farm exports
After a pre-budget consultation meeting with Sitharaman, agricultural economist Ashok Gulati and various farm groups urged India should relax export limits on rice, wheat, sugar, and onions to boost farmers’ earnings.
In 2022, Modi’s government restricted exports of basics and decreased pulse and vegetable oil taxes to lower consumer costs.
More than 45% of India’s 1.4 billion people live off agriculture, and Modi’s decade-long reign has stagnant rural incomes.
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The CII also that the government create an incentive payment plan for private enterprises that create employment in labor-intensive industries like textiles and tourism.
Modi’s bad national election performance was due to voter discontent about unemployment, income decline, and inflation, according to a post-election study.
Ten labor unions from Sitharaman’s pre-budget meetings said the Indian government should promptly fill job shortages and restore pension benefits from a discontinued plan.
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