To pursue reforms: Nirmala Sitharaman

THE National Democratic Alliance government, which has begun a historic third term, is set to pursue continuity in reforms, improving ease of living, responsive policymaking and macroeconomic stability, according to Nirmala Sitharaman, who took charge as the finance minister for a second term on Wednesday.

Sitharaman will present her sixth full Budget (for 2024-25) next month, laying out the new NDA government’s policy priorities. 

The previous NDA government scaled up capital expenditure to tap its multiplier effect on the economy, streamlined the budget by making it more transparent, lowered the fiscal deficit from 9.2% in FY21 to 5.8% in the revised estimates for FY24, and improved the efficiency in social benefits transfers.

After taking charge on Wednesday, Sitharaman said the reforms executed since 2014, when Narendra Modi first took charge as prime minister, will continue, providing further macroeconomic stability and growth for India, according to an official statement. 

The minister also described India’s growth story in recent years amid global challenges as “commendable”, and said the economic outlook for the next few years is optimistic.

Transparency in budgeting

In NDA’s third term, policy measures are expected to be geared towards meeting Prime Minister Modi’s pledge of transforming India into a developed country by 2047. 

Sitharaman urged various departments to advance the NDA government’s development agenda with renewed vigour and ensure responsive policymaking to achieve that goal. 

Sitharaman also sought the support of all stakeholders, including industry leaders, regulators, and citizens, to ensure a strong and vibrant economy.

The forthcoming Union Budget for FY25 will be keenly watched by analysts as it will give an insight into the NDA blueprint for growth and how it balances priorities in a coalition government. 

Sitharaman had said in a social media post last month that the NDA government prioritised transparency in its budgeting practices and numbers, and that countries with transparent budgets are often viewed more favourably by international bodies such as the IMF and World Bank. This can lead to improved global trust, Sitharaman said in the post. 

From FY23, the NDA government also decided to limit the number of supplementary demands for grants to two, making substantive improvements in budget estimation and financial discipline. 

“Our budgets are characterized by fiscal prudence, transparency, and inclusiveness, ensuring investments in social development and infrastructure,” Sitharaman said at the time.