Finance Minister Nirmala Sitharaman is set to present India’s 7th consecutive budget on Tuesday, outlining a roadmap for a developed India by 2047. The budget is expected to include tax relief for the middle class, fiscal deficit reduction, and increased capital expenditure. Key figures to watch include fiscal deficit, capital expenditure, tax revenue, GST collection, borrowing, nominal GDP, and dividends from the RBI and financial institutions.
The Reserve Bank of India (RBI) is expected to transfer a dividend to the Central government in FY25 that is in the same range or slightly more than the last fiscal (FY24). The Centre is also expected to receive a higher dividend from public sector banks (PSBs) in FY2025, as their profits have increased in FY24 compared to the previous year. PSBs reported profits of over 98,000 crore in the first three quarters of FY2024, which are likely to exceed 1.3 trillion by the end of the fiscal year. The dividend from the RBI is usually released to the Centre in May. During FY24, the government had pegged a 17% higher dividend at 48,000 crore from the RBI, PSBs, and financial institutions. However, this target was surpassed with the transfer of 87,416 crore as surplus to the Central government for FY2023 by the RBI, which was paid in May 2023 and accounted for in FY2024 by the government. The dividend payout from PSBs for FY24 has been around 15,000 crore.
Argentine President Javier Milei is implementing drastic spending cuts and austerity measures to reduce the country’s fiscal deficit. Despite initial successes, concerns remain about the impact on economic activity and social welfare. Investors are optimistic, but analysts caution that the effects of the austerity may not be sustainable.
