The Interim Budget 2024-25 despite being an interim one, managed to tick many right boxes. While continuing on the path of fiscal consolidation, it focused on four major goals – Poor, Women, youth and farmers. Despite being the last budget before general election this year, Government rather than delivering a populist budget, continued its walk on the path of sustaining the economic growth through spending across infra ecosystem i.e. physical, digital and social. The budget stays visionary and comprehensive with long term picture in mind, thus focusing on macro along with micro-all-inclusive growth, fintech, financial inclusion, last mile connectivity, digital ecosystem, green energy along with research & innovation.

The limelight of the budget was clearly the focus on fiscal consolidation. While the Fiscal deficit target for FY24 has been revised lower to 5.8 per cent, for FY25 it has been set at 5.1 per cent, lower than the consensus expectation, thus giving a real chance to achieve 4.5 per cent in FY26.

The Centre will borrow ₹14.13 lakh crore from the markets in 2024-25 to finance its fiscal deficit of 5.1 per cent of the GDP. This is much lower compared to the estimate of ₹15.43 lakh crore for the current fiscal.

India’s capex programme for 2024-25 has been raised by 11% to ₹11.11 lakh crore, which is 3.4 per cent of GDP. Since the economic growth is very strong currently, we feel that this is the best opportunity for the government to moderate its capex outflow and walk on the consolidation path.

Among the key sectors that would benefit from the higher capex would be affordable housing, defence, railways, green energy, and tourism.

Focus continues on major schemes with higher allocation being proposed towards PLI Schemes, Development of Semiconductors, solar power, Green Hydrogen, Mahatma Gandhi National Rural Employment Guarantee Scheme, Ayushman Bharat.

Defence has been given the highest allocation of ₹6.1 lakh crore. Higher allocation bodes well for defence indigenization and positively benefits defence players.

Allocation for railways has remained strong from past three years and we view this to be positive for companies focused on wagons, coaches, Vande Bharat, locomotives. The three corridor programmes under PM Gati Shakti would also help in bringing down the logistics cost and improve efficiency. Moreover the focus continues on building urban transportation via Metros.

Pradhan Mantri Awas Yojana (Grameen) is close to achieving target of three crore houses, and has set additional two crore target for next five years. Further Housing for Middle Class scheme will be launched to promote middle class to buy/built their own houses.

Government remains committed to meet “net zero” target by 2070 by focusing on rooftop solar, EV, biomass, wind energy, coal gasification, etc. One crore households will be enabled to obtain up to 300 units of free electricity per month while EV buses adoption would further gain speed.

Expansion of existing airports and comprehensive development of new airports under UDAN scheme would go a long way in boosting tourism. Also, States will be encouraged to undertake development of iconic tourist centres to attract business and promote opportunities for local entrepreneurship.

The extension of Ayushman Bharat facilities to anganwadi and ASHA workers will go a long way to improve the accessibility and affordability of healthcare services in rural India.


Since this was an interim budget, the proposals were expectedly limited. However, it clearly strengthened the trust on the current government as it sticks to its fiscal consolidation path. On the other hand, it brought in various economic reforms and tripled its capex over the last four years which led to multiplier effect on economic growth and employment generation.

The budget is likely to be positive for sectors like affordable housing and financing, infra, capital goods, defence, railways. While the increased focus on improving rural income would be positive for consumer (FMCG), discretionary (auto, durables) sector. Also companies in the renewable and tourism space would benefit from the budgetary allocation.