New Delhi: The steps articulated in the Union Budget are crucial in shaping India’s economic resilience and growth potential in the medium to long term, according to a report on Monday.
The Union Budget 2025-26 displays a balanced approach to sustaining economic growth while reinforcing fiscal prudence.
Finance Minister Nirmala Sitharaman has chosen to stimulate consumption while keeping the focus intact on capex and taking rapid strides towards fiscal consolidation, according to the report by CareEdge Ratings.
“Measures to improve the ease of doing business through deregulation, supporting MSMEs, investments, and exports outline a clear strategy for achieving Viksit Bharat in 2047,” CareEdge Managing Director and Group CEO Mehul Pandya said.
Key tax reforms, including the rationalisation of personal income tax slabs, and the TDS and TCS provisions, aim to simplify compliance and enhance disposable income, fostering consumer confidence.
“No personal income tax for income up to Rs 12 lakhs should provide a big fillip to consumer sentiments and spending,” he mentioned.
Considering the long-term funding needs for the infra sector, the proposal to set up a Partial Credit Enhancement facility for the corporate sector by NaBFID is a welcome step.
Increasing the FDI limit in the insurance sector to 100 per cent is also a step in the right direction. The announcement to establish a High-Level Committee for regulatory reforms reflects a keenness to have a principle-based, light-touch regulatory framework.
The budget’s emphasis on sectors including tourism, healthcare, and manufacturing will catalyse job creation. The continuity in fiscal consolidation, with a budgeted fiscal deficit target of 4.4 per cent for FY26, will help the country move towards debt sustainability. These measures are poised to stabilise the macroeconomic environment, fostering private sector participation and investment.
Prime Minister Dhan-Dhaanya Krishi Yojana will enhance productivity, promote sustainable agriculture, improve storage, irrigation, and credit access across 100 districts, benefiting 1.7 crore farmers in partnership with states.
“Rural Prosperity and Resilience Programme will boost rural employment, create ample opportunities in rural areas, and reduce the necessity of migration. Phase 1 will cover 100 agri-districts,” according to the report.
(IANS)
