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In this context, we take a look at the expectations and hopes of each major sector from the Budget, as pieced together by Mint’s correspondents. These pieces highlight the measures industries hope to see to catalyse growth and put India on a sustainable development path. Click on each link to read the full article about each sector.
Infrastructure
Infrastructure continues to be a priority sector for the government, especially since the covid-19 pandemic. The government is building on an allocation of ₹11.11 trillion—3.4% of GDP—for capital expenditure in last year’s Budget, marking a notable increase from ₹3 trillion (1.6% of GDP) in 2018–19. This momentum is helping compensate for tepid private investments, but maintaining infrastructure spending at current levels while reducing the deficit to 4.5% presents a significant challenge. The finance minister is weighing demands for sops to boost consumption, creating competing pressures on the Budget.
Healthcare
In the healthcare sector, stakeholders are pushing to lower critical treatment costs and seeking expanded insurance coverage. They are recommending reduced customs duties on oncology equipment, a 5% GST on health insurance premiums, and the revival of weighted tax deductions for R&D, given the nation’s urgent need for improved infrastructure and millions of new hospital beds. Government health expenditure stands at 1.84% of GDP, but stakeholders are expecting greater investment to close gaps in access and bolster innovation.
Real Estate
The real estate sector is seeking “industry status” for easier financing and renewed incentives for affordable housing. Developers are looking for a reintroduced tax holiday under Section 80-IBA and lower GST on raw materials to contain construction costs. With affordable housing sales continuing to decline, measures such as expanding the SWAMIH fund for stalled projects and sustaining infrastructure development are likely to help revive demand.
Aviation
The aviation sector expects rationalised taxes on aviation turbine fuel (ATF) to ease cost pressures as domestic passenger traffic continues to soar beyond the five-lakh daily mark. Industry watchers are anticipating further support for regional connectivity through UDAN, alongside funding for new airport infrastructure and the expansion of existing capacities. The Budget may introduce fresh incentives for local maintenance, repair, and overhaul (MRO) facilities, fostering self-reliance and reducing operational costs.
Agriculture
India’s agriculture sector employs over 42% of the population and accounts for 18.2% of GDP. It is seeking support to modernise farming, boost production, and enhance marketing infrastructure. The Budget is likely to introduce incentives under the Bhawantar scheme to raise cotton yields and initiatives to strengthen warehousing and cold-chain networks. With digital agriculture set to transform farming practices, stakeholders are also hoping for investments in data-driven solutions and stronger water management programmes.
Capital Markets
Amid signals of a cyclical slowdown, many in the capital markets are calling for a renewed push towards capital expenditure and incentives that stimulate consumption. They are urging clear targets around disinvestment, energy transition, and tax relief for the middle class, looking to the Budget for guidance on maintaining strong foreign inflows.
Indian Railways
On another front, Indian Railways aims to secure higher outlays to expand its network and modernise operations. Plans to allocate over ₹50,000 crore for new tracks are underscoring the drive to reduce congestion and accommodate high-speed, semi-high-speed, and more frequent services. This infrastructure focus continues to propel a doubling of track additions compared to the previous decade, and public-private partnerships are possibly accelerating rail expansion.
Education
India’s education sector hopes the upcoming Budget will raise allocations towards the National Education Policy (NEP) 2020 target of 6%, up from the current 2.9%. While the literacy rate is 80.3%, stakeholders are saying more must be done to expand STEM, AI, and vocational programmes. They are also focusing on revamping ITIs, building on the ₹60,000 crore upgrade scheme announced earlier.
Textiles
India’s textile industry, employing 45 million people, is seeking extended interest equalisation, revised PLI thresholds, and a National Textile Fund to enhance competitiveness. Textile exports represent a silver lining, reflecting new opportunities amid global sourcing shifts, yet high raw-material costs remain a hurdle. Stakeholders are advocating for the Bhawantar Bhugtan Yojana to stabilise cotton prices and remove import duties on cotton.
Banking
India’s banking sector is entering the Union Budget cycle with robust capital buffers, healthy asset quality, and steady credit demand, although deposit mobilisation lags behind loan growth. Observers believe retail deposit incentives could stabilise liquidity, especially as liquidity coverage ratio norms are tightening. Non-banking finance companies seek funding diversification, continued support for affordable housing and infrastructure, and measures boosting overall market confidence. Industry experts also call for more competition, foreign capital inflows, and tech-driven inclusion to meet India’s “Viksit Bharat” ambitions. Banks are strengthening risk management frameworks as they navigate shifting geopolitical and regulatory challenges.
Energy
India’s energy sector seeks policies that accelerate renewable capacity growth and address delays in power purchase agreements. Non-fossil sources reached 47% of capacity by December 2024, yet stakeholders say more progress is needed, particularly in green hydrogen, which is seeing limited market uptake. The government is pushing local solar manufacturing through production-linked incentives and higher customs duties, reflecting its climate commitments. Analysts emphasise steady capital infusion, simplified regulations, and technological innovation as essential for meeting ambitious climate targets. The sector awaits Budget measures that spur domestic demand and strengthen global competitiveness.
Steel
India’s steelmakers are looking for continued infrastructure outlays and relief from rising imports, which are climbing 22% in 2024 to 9.2 million tonnes, led by cheaper shipments from China and Japan. Industry leaders warn that bargain-priced steel is undercutting domestic mills and jeopardising planned capacity expansions aimed at reaching 300 million tonnes annually. Given ongoing investigations into unfair trade practices, they are also seeking Budget incentives for green steel and regulatory safeguards. Quality control orders by the Bureau of Indian Standards, though not aiming to restrict imports, are possibly curbing substandard alloy inflows. Overall, supportive policies remain vital for sustained sector growth.
(WIth inputs from Madhavan N, Jessica Jani, Madhurima Nandy, Daanish Anand, Dhirendra Kumar, Puja Das, Dipti Sharma, Subhash Narayan, Pratishtha Bagai, Anshika Kayastha, Rituraj Baruah and Nehal Chaliawala.)
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