When a coalition government came in at the center in May 2024, the concern was that reforms may go for a toss. That has largely been true. The government that had been ultra-aggressive in areas like agricultural reforms, ease of business, and Make in India; appeared to suddenly be out of sorts. The previous budget was a delayed budget, but this is a budget for which the FM and the government must be well prepared. It is time to make an unequivocal statement that the reforms process in India is absolutely on track!  

What is the growth narrative; that is the million-dollar question. The budget must make a clear outline of how it plans to achieve growth. Will it be purely fiscal policies or would be combine fiscal and monetary policy thrust. How does the budget plan to provide a big push to the flow of foreign direct investments? How much is the government willing to bet on capex spending. The slowdown this year has had a rather deep impact on growth levers of the economy. More importantly, people want to hear how the growth will translate into higher income and spends. 

In the last few weeks, there have been several suggestions that the government should go easy on fiscal deficit to boost growth. Even the CII had suggested the same. However, it would just undo a lot of good work that the government has done on fiscal prudence in last 3 years. Fiscal imprudence is never appreciated, either by the global investors or by the global rating agencies. Any return to fiscal profligacy may be too risky now! 

There are no two opinions about the fact that inflation is pinching Indian families and, it is pinching hard. The budget must lay out an antidote for inflation. It is not just the food inflation, but even the core inflation that has been pinching families in India quite hard. What can the budget do? It could be about putting more cash in the hands of people via lower indirect taxes, more tax breaks. It must deliver. 

It is time the government seriously takes a deep look into how hard taxes have hit the Indian households. Income tax, STT, capital gains tax, GST; and the list can go on. Whether you call it direct or indirect taxes, it is immaterial. The bottom line is that the average Indian is under a lot of stress due to taxes. We can talk about revenues till eternity, but simpler taxes can be a lot more productive for all!