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Budget 2024 Expectations Highlights: The Budget is likely to feature higher capital expenditure for renewable energy, incentives for green initiatives, and production-linked incentives for solar module manufacturing.
Budget 2024 Expectations Live: Auto industry seeks policy consistency, focus on EV
- Last-mile connectivity, infrastructure, and policy consistency seen as key focus areas for sectoral expansion in the upcoming budget.
- SIAM anticipates no sector-specific announcements but hopes for policy stability to avoid disruptions in the automotive ecosystem.
- Industry, particularly those invested in electric vehicles (EVs), expects continued support for greener technologies.
- Automotive sector seeks updates on potential FAME 3 schemes, GST reduction on lithium-ion batteries, production-linked incentives (PLIs), and lower GST on entry-level ICE two-wheelers (currently 18%).
- Previous budget's reduction in customs duty on EV parts spurred local manufacturing; industry calls for similar amendments in the 2024 budget.
- Beyond financial allocations, manufacturers seek a comprehensive policy framework for EVs, addressing licensing, safety standards, and insurance norms.
Budget 2024 Expectations Live: Momentum anticipated in power sector
- Power sector is expected to gain momentum, driven by the government's increased focus on expanding the utilization of renewable energy.
- The interim budget is likely to include additional details about the recently launched Pradhanmantri Suryodaya Yojana, aimed at making electricity affordable.
- Anticipated announcements include increased capital expenditure for renewable energy projects
- The budget may introduce incentives to promote green initiatives.
- The budget might introduce PLIs for solar module manufacturing.
- Anticipated measures include increased capital spending on battery storage infrastructure.
- Possibility of reducing customs duty on solar cells, potentially from 25 percent to 5 percent.
- It would be an understatement to say that the government wants the manufacturing sector to do well, with the flagship Production-Linked Incentive (PLI) scheme expanding nearly every year. This, the government hopes, will pave the way for more investments and job opportunities.
- As of November 2023, the PLI schemes have attracted more than Rs 1 lakh crore of investment, recorded sales of Rs 8.61 lakh crore, and directly and indirectly created over 6.78 lakh jobs, according to the government.
-"Manufacturing of various electronic components like battery, chargers, PCBA (printed circuit board assembly), PCB (printed circuit board), camera modules, passive components, and certain mechanics have been localised in the country," the government said in a statement on January 17.
Ahead of the presentation of the interim Budget, bond market experts have pitched for steps to deepen India's municipal bond market and encourage more investor participation.
-“If the Budget introduces favourable measures, such as incentives or simplified processes, it could encourage more municipalities to tap the bond market,” said Venkatakrishnan Srinivasan, founder and managing partner of Rockfort Fincap LLP.
-Experts are of the view that further support from the government to municipal corporations for raising funds will increase the number of issuers.
- Ajay Manglunia, managing director and head of investment group at JM Financial, said, “Seeing the trend we expect more issuers to come to the market as the government has put thrust on infra development.”
The agriculture sector stood strong during the coronavirus pandemic, growing by 5.1 percent on average in 2019-20 and 2020-21. If not for the farm sector, the economy would have contracted by far more than the average 1 percent in each of the two aforementioned years.
- However, it has been a tough 2023-24 for farmers, with the statistics ministry estimating that the sector's growth rate this year is set to be at an eight-year low of 1.8 percent.
-"Exacerbating the anticipated downside in 2023 Kharif production, Rabi sowing has lost pace in recent weeks with area sown under pulses lagging by 5.1 percent. In addition, El Nino as a global phenomenon continuing into 2024 could spell some downside for the Rabi crop in the face of warmer temperatures over January-March 2024 and April-June 2024," economists from QuantEco Research said.
