The Union Budget is always a moment of anticipation for financial markets. This year, Mahesh Patil, Chief Investment Officer (CIO) at Aditya Birla Sun Life AMC, offers a pragmatic outlook, emphasising the importance of execution and targeted measures to address economic challenges. In an exclusive interview, he shared his expectations for the upcoming budget.
With the Union Budget coming up, what are your top expectations from the government? Which policies could have the biggest impact on the markets?
I don't think we've got much expectation over here, as the room for the government on the fiscal side is very limited. The government is also on a fiscal consolidation path, so we will see the fiscal deficit come down. The government has done well in the last few years, in the post-Covid-19 period, to address the supply side. But the challenge is there on the demand side, and there could be some stimulus. I don't know what will come; it can be a boost to the rural economy or some kind of tax benefit to the bottom of the pyramid.
I don't think there will be too much tinkering on the capital gains tax, as they did a lot of reshuffling last year on that front. They should not do anything detrimental that could hurt the sentiment, as it is weakened at this point in time. They should be focusing more on execution; that's where the challenge has been in the last six to nine months from both the central as well as the state side. I think trying to implement some of the existing budget announcements that were made last year will be the key to bringing some recovery back to the economy.
Conclusion
Mahesh Patil's insights reflect a pragmatic approach, emphasising the importance of execution and targeted demand-side measures. His perspective highlights the delicate balancing act required to foster growth while adhering to fiscal constraints, making the Union Budget 2025 a pivotal event for markets and the economy.
Also read: India's first Budget: The birth of economic sovereignty
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