India’s 2024 budget: What does it say about the economy, elections?

The Modi government has snipped its food subsidy bill while also lowering its fiscal deficit target.

With national elections around the corner, the Indian government on Thursday announced an interim budget mostly along expected lines, with a few surprises rolled in both for investors and rural voters.

The world’s fifth-largest economy, and its most populous nation, will vote between March and May to choose its next federal government. The final budget before the national vote is often the last chance for an incumbent administration to shower voters with promises and projects.

Yet, while the budget announced by Indian Finance Minister Nirmala Sitharaman includes references to key segments of voters who will be critical in the elections, it mostly follows expected lines, economists said.

Here are some key takeaways from the budget:

The government of Prime Minister Narendra Modi has set a fiscal deficit target of 5.1 percent for the financial year starting April 1, after lowering the current year’s deficit to 5.8 percent of gross domestic product (GDP), Sitharaman said.