An India-centric business advocacy group based in the US has praised Finance Minister Nirmala Sitharaman for her consistency and emphasis on growth in her interim Budget, saying it is a welcome declaration of careful budgetary management in an election year. In keeping with the strengthening economic connections between the US and India, the US-India Strategic and Partnership Forum (USISPF) also praises the government’s ongoing emphasis on the three key areas of infrastructure, inclusive growth, and fiscal responsibility.
Sitharaman made the interim budget presentation on February 1.
“As an interim, pre-election budget with no major policy pronouncements, it represents a welcome statement of responsible fiscal management in an election year,” the USISPF stated in a statement.
In India, general elections are anticipated to take place in April or May.
The fiscal deficit is expected to decrease to 5.1% in the forthcoming fiscal year (2025), while GDP growth is expected to stay between 6% and 7%. These are the budget predictions.
Regarding spending, the administration will continue to place a high priority on medium-term growth driven by increased capital expenditure as well as short-term spending on social protection and job creation.
“We believe these priorities, within the framework of fiscal consolidation, will help strengthen India’s macroeconomy, lower government borrowing costs, and support the increased foreign trade and investment that is the foundation of the US-India partnership,” stated the USISPF.
It added that the 2024 budget increases capital expenditures, which are crucial to maintaining the engine of economic growth, by 11.1% to USD 133.9 billion. “In line with growing US-India commercial ties, we commend the government’s continued focus on the trinity of infrastructure, inclusive growth, and fiscal prudence,” the statement read.
Concurrently, the government has prioritised funding infrastructure projects, allocating USD 130 billion for ports, airports, railroads, and highways.
It stated that all of these initiatives will support the influx of private capital, particularly foreign direct investment from the US, into these industries.
“We also recognise and support the important social spending included in the budget, such as the construction of 20 million affordable houses in the next five years, which will give a boost to the rural economy with new jobs and the construction sector,” added the statement.
The group applauded India’s ongoing efforts to reach its clean energy targets, particularly the initiative to supply 10 million families with free rooftop solar-generated electricity.
It stated that more funding for the healthcare, education, and manufacturing sectors—the latter through the PLI schemes—will support the development of robust supply chains and draw in the high-end tech industry, which are important goals for both Washington and New Delhi.
“With regard to revenue, the budget avoided making big changes to tax laws, preserving the middle-class salary rate at 15% through March 2024 and middle-class salaried rate at 4%. We wish to see this tax stability policy continued beyond the upcoming fiscal year, as it provides a key support for increased investment and job development,” the USISPF stated.
