Union Budget 2024: No likely cut in fuel prices, PMAY allotment may rise

The Union Budget 2024 is expected to be announced in the third week of July. Finance Minister Nirmala Sitharaman to hold pre-budget meeting on June 20

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Ahead of the upcoming Union Budget 2024, reports indicate that the Centre is unlikely to slash the prices of petrol and diesel till the global price of crude oil slips below $70 a barrel.

A CNBC-TV18 report quoted Minister of Petroleum and Natural Gas of India Hardeep Singh Puri as saying that prices are likely to come down once the global crude oil price falls below $70 per barrel. As of June 12, India’s crude basket was priced at $82.31, up from $72.41 a year ago.

Pradhan Mantri Awas Yojana (PMAY)

Reports also indicate that the government may increase the cap on home prices, enabling more buyers to qualify for affordable home loans.

This would benefit the lower middle class, create construction-related employment, and stimulate business activities across various sectors including developers, cement manufacturers, and paint companies, among others.

In the current financial year, the Pradhan Mantri Awas Yojana has received Rs 80,000 crore. When including allocations for rural housing, around 20 per cent of the total estimated Rs 4 trillion has already been earmarked in the February interim Budget.

Plans to expand electric bus fleet

The report suggests that the government may consider allocating Rs 70,000 crore to expand the fleet of electric buses across India. A significant portion of this funding would be directed towards establishing electric bus charging infrastructure nationwide.

Additionally, a new ‘risk reduction fund’ could encourage banks to extend loans to private individuals interested in purchasing electric buses. According to sources, the interest rates on these loans for electric buses may match those currently available for diesel buses.

Aspirational districts programme

The report shows that the government is considering to increase the allocation for the aspirational districts programme beyond the current target of 500 districts in the upcoming Budget.

Funding for this initiative is categorised under the Official Development Assistance for Sustainable Development Goals in the Budget. The allocation decreased from Rs 496 crore in FY23 to Rs 113 crore in the revised estimate for February 2024. However, the allocation for FY25 was increased to Rs 433 crore in the interim Budget.

Some government sectors advocate that increased welfare spending may necessitate offsetting through divestment and asset monetisation strategies. The proposal involves selling or leasing government assets that are either unused or underutilised to private entities. These assets encompass infrastructure such as roads, railway stations, oil and gas pipelines, mines, and land holdings, among others, the report stated.

The National Monetisation Programme received Rs 97,000 crore in its inaugural year concluding in March 2022. The figure surged to Rs 1.62 trillion in the next year, although it fell short of the FY23 target. As of February 2024, the government projected an inflow of around Rs 1.5 trillion for the entire financial year.