By Dipak Kurmi
Imagine the construction of a grand structure, rising steadily through coordinated effort, precision, and patience. Men and machines work in harmony, guided by a blueprint that balances ambition with realism, ensuring that each level is strong enough to support the next. The vision of Viksit Bharat by 2047 is akin to such a structure. It is not a destination that can be reached in a single leap, but a cumulative outcome shaped by successive policy decisions, reforms, and fiscal choices. Each Union Budget, therefore, becomes a critical stepping stone in this long-term journey, translating aspiration into actionable progress.
Over the past few years, the government has consciously aligned its economic strategy with this vision. Infrastructure creation has emerged as a central pillar, backed by sustained budgetary support for roads, railways, ports, airports, and logistics networks. Alongside this physical buildout, the rapid pace of digitalisation and technology adoption has redefined how the state interacts with citizens and markets. Economic reforms aimed at improving the ease of doing business, reducing compliance burdens, and enhancing transparency have complemented these efforts. Together, these measures have begun to lift India’s potential growth trajectory. The latest Economic Survey reflects this shift, raising the estimate of potential growth by 50 basis points to 7 per cent, up from 6.5 per cent estimated just three years earlier, signalling a structurally stronger economy.
This reform momentum has gained further traction in the current fiscal year, reinforced by India’s expanding engagement with global markets. The signing of multiple free trade agreements marks a strategic push to integrate more deeply with global value chains while diversifying trade partnerships. The recently announced trade deal with the United States, following an earlier agreement with the European Union and several others, is expected to provide a material boost to domestic economic activity. Improved access to the US market across a wide range of product categories should enhance India’s export competitiveness and strengthen investor sentiment. In an increasingly fragmented global trade environment, such agreements position India as a credible and reliable economic partner.
Against this backdrop, the latest budget seeks to consolidate and extend the gains already made. Supporting growth while navigating a global environment marked by protectionism, geopolitical tensions, and economic uncertainty is no easy task. The strategy adopted is therefore grounded in continuity rather than disruption. Fiscal prudence remains a cornerstone, allowing the government to retain the flexibility needed to support the economy while preserving macroeconomic stability. This balance is particularly important at a time when many economies are grappling with high debt and inflationary pressures.
The commitment to fiscal discipline is evident in the government’s approach to deficit management. Despite the fiscal shock inflicted by the Covid19 pandemic earlier in the decade, the NDA government has remained focused on restoring fiscal rectitude. The medium-term fiscal deficit target has already been achieved in the current fiscal year, and the policy framework has now shifted towards targeting the debt-to-GDP ratio, aligning India with international best practices. For the next fiscal year, the budget has set a fiscal deficit target of 4.3 per cent of GDP, consistent with the broader objective of gradually reducing the debt burden while sustaining growth.
Equally significant is the improvement in the quality of public spending. The focus has increasingly been on protecting and expanding capital expenditure rather than allowing it to be crowded out by revenue expenditure. This approach strengthens the productive capacity of the economy and creates long-term assets that support growth. Assumptions underlying the budget, including nominal GDP growth of around 10 per cent and tax revenue projections, are conservative and achievable, lending credibility to the fiscal arithmetic. The sharp increase in the divestment target to Rs 80,000 crore in the next fiscal year, from nearly Rs 34,000 crore in the current year, signals intent, though it will require determined and frontloaded execution given the challenges faced in meeting such targets in recent times.
The budget also reflects a nuanced understanding of the structural shifts underway in the Indian economy. In manufacturing, the emphasis is clearly on new-age sectors that are expected to drive future growth. Semiconductors, data centres, biopharma, and electronics have been prioritised through a mix of fiscal incentives, tax reforms, rationalised customs duties, and streamlined import procedures. At the same time, the government has not lost sight of legacy sectors such as textiles and micro, small, and medium enterprises, which continue to play a vital role in employment generation and regional balance. This dual focus seeks to combine technological advancement with inclusive industrial development.
The scale of this transformation is reflected in investment projections. According to Crisil, new-age sectors are expected to account for nearly a quarter of India’s industrial capital expenditure over the next five years, up from about 12 per cent during fiscals 2021 to 2025. This shift underscores the changing composition of India’s industrial landscape, as capital increasingly flows towards technology-intensive and future-oriented industries. The budget’s policy signals are clearly aligned with this transition, aiming to crowd in private investment and build globally competitive manufacturing ecosystems.
Beyond manufacturing, the services sector receives renewed and deliberate attention. Recognising that services will continue to be a major engine of growth and employment, the budget has introduced a range of measures to strengthen this segment. The establishment of a high-powered Education to Employment and Enterprise Standing Committee reflects an effort to address persistent skill mismatches and ensure that education systems are better aligned with labour market needs. Targeted initiatives in tourism, healthcare, education, sports, and technology services further underline the intent to unlock the sector’s full potential.
Tourism, in particular, has been accorded strategic importance, with a focus on experiential travel. This segment caters to affluent travellers seeking unique and immersive experiences, and its prioritisation represents a pragmatic response to the K-shaped global recovery, where wealth gains are increasingly concentrated at the top. Emphasis on medical and heritage tourism, as highlighted by the Finance Minister, has the potential to generate employment in smaller towns and rural areas, spreading the benefits of growth beyond metropolitan centres. These opportunities are especially valuable because many such jobs are relatively insulated from the disruptions expected from the growing use of artificial intelligence.
The broader context of technological change adds urgency to this focus. Advances in automation and artificial intelligence are likely to displace certain categories of jobs while creating new ones, often requiring different skill sets. In this environment, expanding labour-absorbing services such as healthcare, tourism, and education becomes essential to maintain employment momentum. The budget’s interventions aim to balance technological progress with social stability, ensuring that growth remains inclusive even as the economy modernises.
Taken together, these measures suggest a budget that is both growth-oriented and disciplined. Fiscal restraint has been maintained, helping ensure that the policy stance remains non-inflationary even as public investment continues. This careful calibration is particularly important in an economy of India’s scale, where macroeconomic instability can quickly undermine hard-won gains. By prioritising capital formation, structural reforms, and targeted sectoral support within a framework of fiscal responsibility, the budget reinforces the credibility of India’s long-term growth strategy.
The budget appears to deliver exactly what the economy requires at this juncture. It does not promise dramatic departures or quick fixes, but instead strengthens the foundations of a long-term vision. Like the careful construction of a grand structure, it adds another level to the edifice of Viksit Bharat, ensuring that ambition is supported by stability and foresight. If execution matches intent, this approach could well sustain India’s growth momentum and bring the country closer to its goal of becoming a developed nation by 2047.
(the writer can be reached at dipakkurmiglpltd@gmail.com)
