Four big promises

Budget 2025 will have achieved a lot if it fulfils the promises made in July 2024

- RAISINA HILL A K BHATTACHARYA

With less than six weeks to go before Finance Minister Nirmala Sitharaman presents the Union Budget for 2025-26, expectations regarding what she should do for the Indian economy are on the rise. In brief, many industry bodies and leaders expect her to undertake further fiscal consolidation along with measures that could help prop up the economy's growth. But before taking a close look at all those expectations, it may be appropriate to situate Ms Sitharaman's forthcoming Budget in a historical context.

This will be her seventh consecutive full Budget, and a record in itself. No other finance minister in India has presented seven Union Budgets in a row. In the process, she will beat Chintaman Deshmukh's record of six consecutive Budgets in the 1950s. In terms of the total number of full Budgets presented, she will still be a Budget behind Morarji Desai and Palaniappan Chidambaram.

Desai's eight Budgets were presented in two different tenures – five in the first and three in the second tenure – while Mr Chidambaram's eight Budgets were presented in three different tenures – two in the first, five in the second, and one in the third. And since one should not ignore the gender profile of finance ministers, Ms Sitharaman has already become the longest-serving woman finance minister, leaving Indira Gandhi behind by miles.

Expect, therefore, a reduction in the fiscal deficit to below 4.5 per cent, perhaps to 4.3 or even 4.2 per cent of GDP in 2025-26. That would amount to a five-percentage point reduction in fiscal deficit over a five-year period since the high of 9.2 per cent recorded in the Covid year of 2020-21.