Budget 2025 Preview - Spending Growth Likely To Be Increased In FY25: Motilal Oswal

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Motilal Oswal Report.From the Budget 2025 perspective, we believe that the new government will largely retain its tax and non-debt capital receipt (including disinvestment) projections as presented during the Interim Budget in Feb-24. If so, a transfer of Rs 2.11 trillion by the RBI implies excess receipts of about Rs 1.5 trillion in FY25. A large part of these additional receipts, we believe, would be spent under various heads, while a small portion could be used to reduce the fiscal deficit.Rs 300-400 billion could be utilized to reduce the fiscal deficit to 5% of GDP, from the 5.1% of GDP announced in the Interim Budget. One of the ways to spend additional resources could be to provide more capex-related loans to states, which would also make the Center’s total capital spending (including loans and advances) look better. The Center budgeted Rs 1.4 trillion to states and UTs as loans and advances in FY25 in the Interim Budget, which could be increased by Rs 300-400 billion.Similarly, if the government decides to revise the installments under PM-KISAN by 50% to Rs 9,000 per annum, it would entail the cost of another Rs 300 billion to the exchequer. The remaining Rs 500 billion could be used by the Union Government to provide some more incentives to the taxpayers to shift to the new tax regime and to expand on housing schemes or various other schemes.  Overall, we do not expect the government to divert from its fiscal deficit consolidation path while improving the quality of fiscal spending. It is, however, very likely that fiscal spending could be increased (versus Feb-24 budget), due to higher receipts led by the RBI dividend..Click on the attachment to read the full report:.ICICI Bank - Well Poised To Sustain Best-In-Class Performance: Motilal Oswal.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Budget 2025 Preview - Spending Growth Likely To Be Increased In FY25: Motilal Oswal

Fiscal deficit target could be reduced to 5% of GDP in FY25

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