India’s budget 2022: focus on infrastructure to sustain economic growth

  • India’s budget for April 2022 to March 2023 (FY23) is broadly positive, with a focus on capex-led growth (capex accounts for 19% of total spending vs 16% a year ago) and a slow path towards fiscal consolidation
  • The fiscal deficit is estimated at 6.4% of GDP in FY23 (vs 6.9% in FY22), and the government maintains its fiscal consolidation target at less than 4.5% of GDP by FY26
  • Government bonds are unlikely to be included in global indices in FY23 given that no steps have been taken to eliminate capital gains tax — a key requirement for listing the government bonds on the Euroclear platform
  • Extension of the Emergency Credit Line Guarantee Scheme (ECLGS) by one more year (to March 2023)
  • Launch of central bank digital currency in FY23
  • 30% tax on gains from digital assets — a positive step towards recognition and part legalisation of digital assets

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We write about financial industry trends, the impact of regulatory changes and opinions on industry inflection points. https://www.acuitykp.com/

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Acuity Knowledge Partners

Acuity Knowledge Partners

We write about financial industry trends, the impact of regulatory changes and opinions on industry inflection points. https://www.acuitykp.com/

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