Economy
The week in charts: Budget 2024, corporate profits, aviation fee
Summary
News and developments from the week gone by, through numbers and charts.NEW DELHI : Every Friday, Plain Facts publishes a compilation of data-based insights, complete with easy-to-read charts, to help you delve deeper into the stories reported by Mint in the week gone by. The government has set its fiscal deficit target for 2024-25 to 4.9% of gross domestic product (GDP), while companies results were a mixed bag with the top line rising but net profits declining.
Fiscal math
The Centre has reduced its fiscal deficit target to 4.9% of GDP for 2024-25, down from the 5.1% target set in February's interim budget as it chose financial consolidation over populist measures. The fiscal deficit has been cut by a mix of higher revenues and lower expenditure. Total expenditure is pegged at 14.8% of GDP, slightly down from 15% in 2023-24, while total receipts is pegged at 9.8% of GDP, up from 9.4% in the previous fiscal year.
Also Read: How Budget signals policy continuity, explained in 8 charts
Job push
The Centre has committed to pay one month's salary to a first-time employee enrolled in Employees' Provident Fund Organisation (EPFO), via direct benefit transfer, up to a maximum of ₹15,000, in three instalments. This could incentivise formalisation of jobs in the country especially since only around 20% of the workforce are regular wage or salaried workers, according to the Periodic Labour Force Survey report for 2022-23. Even within them, the share of workers with no social security benefits—such as EPFO enrolment—was 54%.
Also Read: Three Budget schemes target formal employment. But will they deliver new jobs?
Tax saving
₹17,500: This is the maximum amount a salaried taxpayer can save under the new tax regime, after the government made revisions to the income tax slabs in the recently presented budget. The government raised the standard deduction from ₹50,000 to ₹75,000 and rejigged the tax slabs under the new tax regime. As per the revisions, there is no tax liability for income up to ₹3 lakh, income from ₹3 lakh to ₹7 lakh will attract 5%. Income above ₹7 lakh will see taxes from 10-30%.
Also Read: Budget deals capital gains tax blow to investors
Mixed bag
India companies' performance in the June quarter was a mixed bag, with revenues rising but profits declining. The combined revenue of 204 BSE-listed companies that have declared their June-quarter financial results so far has risen 5.83% year-on-year, while net profits are down 10.7%, a Mint analysis showed. Of these, 34 are from banking, financial services and insurance (BFSI) sector. Excluding them, the top line grew 4.6% while profits were down 14.8%. In the same quarter last year, revenue was up 3.4%, while profits had surged 48.7%.
Securing safety
After facing criticism over railway accidents, the government has increased its expenditure on railway safety but only marginally. The revenue and capital expenditure on safety by the railway minister had gone down as percentage of total expenditure in recent years, according to a pre-Budget Mint analysis. However, the full budget presented earlier this week raised the expenditure to 20.1% of total expenditure in 2024-25. This is still less than 22% expenditure seen in 2017-18.
Byju’s woes
$235.19 million: This is the value of personal assets of Byju Raveendran that Qatar Investment Authority (QIA), one of the largest external investors in India, wants disclosed, Mint reported. The wealth fund has moved the Karnataka high court for the disclosure and asked the court to prevent Raveendran from selling, pledging or transferring his assets. Raveendran’s company Byju’s is currently facing insolvency after the Board of Control for Cricket in India took it to court over ₹150 crore of unpaid dues.
Also Read: Budget 2024-25: The ultimate explainer
Inflation focus
In one of its suggestions, the latest Economic Survey proposed the idea of excluding food inflation from the Reserve Bank of India’s (RBI's) inflation targeting framework as monetary policy may be ineffective against supply-driven food price hikes. Food prices, especially those of vegetables, are volatile and do add uncertainty to headline inflation. While high food inflation is currently pushing inflation up, it was also responsible for pulling inflation down in 2021. Hence, removing food inflation from headline inflation does not always guarantee a lower inflation.
Chart of the week: Flight fee
Consumers may be paying more for flights this year than a year ago as 13 major airports have steeply increased the user development fees (UDF) in 2024-25, a levy designed to bridge revenue shortfall and ensure fair returns for airports.
Follow our data stories on the “In Charts" and “Plain Facts" pages on the Mint website.
