Budget 2023: Know the hits and misses of the last full union budget before the 2024 elections

In her fifth Union Budget speech, FM Nirmala Sitharaman announced a mega capex plan of Rs 10 lakh crore for FY 2023-24, which is 33% higher than the budget estimate of Rs 7.5 lakh crore for 2022-23.

Markets started with positive expectations heading into the budget as strong buying was witnessed across the broader market, with many stocks hitting fresh 52-week highs. However, a strong sell-off in the Adani Group stocks dented market sentiment as Nifty plunged over 500 points from the day’s high to slip below the 17,400 level. The market has turned very volatile as life insurance stocks experience the worst sell-off amid bad business expectations post announcements in the budget.

In her fifth Union Budget speech, FM Nirmala Sitharaman announced a mega capex plan of Rs 10 lakh crore for FY 2023-24, which is 33% higher than the budget estimate of Rs 7.5 lakh crore for 2022-23.

Also, FM has announced a new tax rebate that would have an exception of up to 7 lakhs under the new tax regime, which has cheered the general population.

Fiscal deficit target has been reduced to 5.9% for FY 2023-24 from 6.4% in FY 2022-23, which is quite an optimistic target as per FM.

The Indian Railways has been allocated a capital outlay of Rs 2.4 lakh crore in the Union Budget 2023-24. This is the highest-ever allocation to the national transporter and continues on the trend followed last year with gross budgetary support of Rs 1.37 lakh crore in fiscal 2022-23.

The recently launched national green hydrogen will help the country to transition to low carbon intensity and reduce dependency on fossil fuel imports. Allocation for Rs 35,000 crore capital investment towards energy transition and net zero objectives has been made.

Post the budget, Manish Kothari, President and Head – Commercial Banking, has quoted, “All-rounder budget from the FM – prudent and growth-oriented – with practically all segments receiving a positive touch! FM has managed to focus strongly on capex/investment and spur domestic consumption and still managed to bring down fiscal deficit to 5.9%. And all of this without bunging in any unreal numbers across govt. borrowings and govt. expenses OR on tax revenues, divestment target, etc. I believe this budget is likely to create a multiplier impact on the economy.”

However, despite a good budget, the market turned negative as the world’s second-largest sovereign fund Norges Bank cut down exposure in the Indian giant Adani group from USD 800 million to USD 200 million amid rising concerns of fraud and corruption.