Union Budget 2024: Goldman Sachs forecasts 'golden' fiscal future for India
economic policy towards 2047 with an emphasis on job creation through labour-intensive manufacturing, credit for MSMEs and continued focus on services exports by expanding GCCs, according to Goldman Sachs.
“We expect the general government to stick to the announced fiscal deficit target of 5.1% of GDP for FY25 (or even slightly lower) and announce further consolidation to a deficit of below 4.5% of GDP by FY26”, Goldman Sachs said in a note Monday.
Union finance minister Nirmala Sitharaman will present the full budget for FY25 on July 23. In her interim budget, presented in February, she had pegged fiscal deficit at 5.1% of GDP
«We see an emphasis on job creation through labor-intensive manufacturing, credit for micro, small and medium enterprises, continued focus on services exports by expanding global capability centres, and a thrust on domestic food supply chain,» the note said.
Goldman said its advice to investors would be to look beyond just the fiscal numbers in this budget.
“We think the government will use the budget as an opportunity to make a big picture statement about the long-term economic policy vision over the next several years, rather than minor stimulus announcements,” it said.
There could be thrust on the rural economy, food supply chain and inventory management domestically to control price volatility as per the note. “This is likely to happen through focus on rural infrastructure for better connectivity, incentivizing domestic food production, cold storage and food processing,” the note
