Budget 2025 Expectations: ‘There Could Be Something For Middle-Class...’ CII's Chandrajit Banerjee | EXCLUSIVE

Chandrajeet Banerjee, the Director General of the Confederation of Indian Industry (CII), has outlined key expectations for the upcoming Union Budget , emphasising the need for a growth-oriented approach. Banerjee argues that the budget should focus on fostering economic growth, addressing critical areas like employment generation and reviving consumption demand to ensure sustainable progress.

Banerjee expressed confidence that the budget would address the needs of India’s middle class, focusing on income tax relief and simplified tax filing procedures. Reducing income tax for lower-income groups would provide greater financial flexibility and allow for enhanced consumption. Furthermore, Banerjee suggested that the budget should prioritize affordable housing in urban areas, a move that would benefit the middle class and support the housing sector.

Growth-Oriented Approach
At the heart of CII’s expectations is a growth-centric budget. Banerjee highlighted the importance of capital expenditure (Capex), noting that the continued focus on infrastructure development is essential to driving India’s economic momentum. The government’s efforts post-COVID to ramp up infrastructure spending have shown positive results, and Banerjee believes that further strengthening the Capex framework can help sustain growth. He recommended a 25 increase in central government Capex and a 10 per cent rise in state Capex, particularly in rural areas. By prioritizing infrastructure investments, the budget can help stimulate job creation and attract private sector investments, which are crucial for India's long-term economic health.

Banerjee stated, “We have the capacity to grow at 8 per cent plus year on year, and for that, we need a budget that is completely focused on growth. Infrastructure spending and investments are the key to driving this growth.” Banerjee also pointed out that, in light of India’s growth targets, it is essential for the budget to support an 8 per cent GDP growth trajectory. 

Employment Generation
With India’s population surpassing 1.4 billion, employment generation remains one of the most pressing issues. Banerjee shared CII’s proposal for an Integrated National Employment Policy, which would consolidate various employment-generating initiatives from both the central and state governments under one unified framework. This policy would also feature a national employment portal, making it easier for job seekers to access opportunities. Additionally, a national career service would provide real-time data on job availability, projections, and future skills requirements.

Banerjee further emphasised the importance of targeted support for employment-intensive sectors, such as construction, textiles, and tourism, which have significant potential to create jobs. These sectors are poised to benefit from global demand, and policies should encourage their growth. He also suggested the introduction of internship programs for rural youth, helping them develop the skills needed to compete in the job market.

“We need to focus on employment-intensive sectors like textiles, tourism, and construction, where we can see global demand and significant job creation opportunities. Rural internship programs for youth can also help bridge the employment gap,” Banerjee said.

Reviving Consumption Demand

To support overall economic growth, CII has called for measures to boost consumption demand, particularly in the wake of challenges posed by inflation. Banerjee proposed income tax cuts for individuals earning up to 20 lakh rupees annually, which would increase disposable income and lead to higher consumption. This, in turn, would generate greater demand for goods and services, creating a positive cycle that supports economic expansion.

Banerjee noted, “If we can cut income tax, especially for those earning up to 20 lakh rupees, it will have a direct impact on consumption. This will boost demand, investment, and ultimately, our growth.”
In addition to tax relief, CII suggested excise duty cuts on fuel, which would reduce costs for both businesses and consumers. Such measures would provide immediate relief and support broader consumption, benefiting households and enterprises alike. Banerjee also proposed consumption vouchers for low-income groups, enabling them to spend on designated goods and services, further stimulating demand.