Mumbai, India – Prema Salgaonkar begins her day before dawn, preparing nearly 100 vegetable-stuffed parathas in her suburban Mumbai home to sell. After losing her job at a nonprofit nearly a year ago, Salgaonkar, along with her son Amar, who lost his mobile sales job six months ago, now scrambles for work in a challenging economy. Amar, 35, has taken up temporary jobs, traveling at night on transport trucks and helping drivers with police negotiations.
As Finance Minister Nirmala Sitharaman prepares to present the 2025 budget on February 1, her task is daunting: finding ways to spark economic growth and create employment for millions of people like the Salgaonkars, while keeping the fiscal deficit under control. Prema’s daily struggles highlight a larger issue faced by many: rising vegetable prices and a lack of steady income, leaving her unable to afford her son’s wedding, a dream that now feels distant.
India’s GDP growth dropped to 5.4% for the quarter ending September 2024, the lowest in seven quarters. Growth is predicted to slow to 6.4% for the fiscal year ending March 31, marking the weakest pace in four years. However, Dhiraj Nim, an economist at ANZ Bank, cautions that there is little room for increased government spending to boost growth due to the fiscal deficit, which ballooned to 9.3% in 2021 due to pandemic-related expenses. The target for this year is to bring the deficit down to 4.9%, with hopes to reduce it further in 2026.
Despite significant infrastructure investments under Prime Minister Modi’s government, weak consumer demand and low private sector investment continue to hinder recovery. Sunil Sinha, an economist, notes that post-pandemic demand for mass-consumption products remains low, further stressing the economy’s challenges.
For individuals like Amar, finding new job opportunities has been difficult, especially after the boom in mobile sales post-COVID began to taper off. As the budget approaches, the government’s ability to balance fiscal responsibility with the need for growth remains a key question for India’s future.
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