Budget 2025: Funding growth without hurting expenditure profile a major challenge, says Emkay's Madhavi Arora

Madhavi Arora, chief economist at Emkay Global Financial Services, expects minor adjustments to tax slabs in the upcoming budget but, rules out any major changes.

Arora also points out that the government is in a policy trade-off wherein not only do they have to ensure that the fiscal consolidation continues but also the fiscal multipliers to growth are still maximised. “That is a very sticky situation to be in. The government will have to focus a lot on income profile or revenue mobilisation capacity so as to fund growth without really worsening the expenditure profile. That will be the biggest challenge as the government continues with the consolidation. Apart from this, the government will start looking at managing the debt-to-GDP ratio more closely,” Arora said.