In the interim Budget presented by Finance Minister Nirmala Sitharaman, the Union government has assumed a nominal GDP growth of 10.50 per cent for the fiscal year 2024-25.
The revised estimate of the fiscal deficit for FY24 is 5.8 per cent of GDP, improving on the budget estimate despite a moderation in nominal growth estimates. The fiscal deficit target for FY25 has been set at 5.10 per cent of GDP.
Union Finance Minister Nirmala Sitharaman said, “The revised estimate of the fiscal deficit for FY24 is 5.8 per cent of GDP, improving on the budget estimate notwithstanding moderation in the nominal growth estimates.”
Sitharaman said that the FY25 gross market borrowing is pegged at Rs 14.13 lakh crore, with net borrowing at Rs 11.75 lakh crore. The capital expenditure (capex) target for FY25 is set at Rs 11.1 lakh crore, representing an 11.1 per cent increase.
Highlighting the significance of foreign direct investment (FDI), Sitharaman stated that FDI inflow during 2014 to 2023 amounted to Rs 596 billion US dollars, marking a golden era and being twice the FDI inflow between 2005 and 2014. To sustain FDI, negotiations for bilateral investment treaties with foreign partners are underway.
“FDI is ‘First Develop India’… FDI inflow during 2014 to 2023 was Rs 596 billion US dollars, marking a golden era. This was twice the FDI inflow between 2005 and 2014. For sustained FDI, we are negotiating bilateral investment treaties with foreign partners,” she said.
Additionally, the Finance Minister proposed a provision of Rs 75,000 crore as a 50-year interest-free loan to support milestone-linked reforms by state governments, aiming at realising the vision of Viksit Bharat. She also mentioned initiatives for promoting domestic tourism, including projects for port connectivity and tourism infrastructure on islands, including Lakshadweep.
“To address fervour for domestic tourism, projects for port connectivity, tourism infrastructure, and amenities will be taken on our islands, including Lakshadweep,” says FM Sitharaman.
The revised estimate of revenue receipts is expected to be higher than budgeted in the interim Budget presented by the Finance Minister. The total receipts for the fiscal year 2024-25 are pegged at Rs 38.80 lakh crore.
The gross government borrowing for FY25 is set at Rs 14.1 lakh crore, while the gross market borrowing for FY25 is pegged at Rs 14.13 lakh crore and the net borrowing at Rs 11.75 lakh crore, according to the Finance Minister.