As India enters its 75th year of independence the Union Government has reinforced, with its Budget for financial year 2023-24, its continued commitment to boost economic growth by investing in infrastructure development leading to an increase in capital expenditure by 37.4% over the revised estimates for the previous year 2022-23.

With Amrit Kaal as the motto (which refers, in Vedic astrology, as that critical time when the doors for greater success open up for human beings), the Finance Minister, Ms. Nirmala Sitharaman, laid great emphasis on the technology-driven and knowledge-based growth of the economy with the primary objective of financial stability as she announced the Budget on 1st February 2023.

Among the Saptarishi (7 priorities of this year’s budget), that seek to guide India into the Amrit Kaal are “Infrastructure and Investment” and the “Financial Sector”. Investors have much to look forward to, with substantial anticipated growth in the infrastructure, logistics and manufacturing sectors.

I. Infrastructure Sector

This is the third consecutive budget which has seen an enormous increase in the capital investment outlay which was announced at Rs.10 lakh crores i.e. 33% higher than the preceding years and almost 3 times that of 2019-20.

In addition to substantial support being extended to State governments, the Union has announced assistance directed towards private investments which will be facilitated by the newly established Infrastructure Finance Secretariat.

This welcome change bodes specifically well for private investors in the railwaysroadsurban infrastructure and power sectors which have until now been primarily dependent on public resources.

Further, a 48% rise in seen in the budget for the renewable energy sector.

Also, an Urban Infrastructure Development Fund, with a budget of a hefty Rs.10,000 crores, is set to be established with the intent of creating urban infrastructure in Tier 2 and Tier 3 cities.

Coastal shipping will be promoted, in line with the saptarishi of “Green Growth”, as a means of energy efficient and low-cost transport, for both, passengers as well as freight.

These provisions open the doors for foreign investors awaiting the opportunity to collaborate or invest in infrastructure projects in India, such as Japan and Korea.

II. Logistics Sector

A hefty budget of Rs.75,000 crores has been set aside for the investment in one hundred critical transport infrastructure projects for improved connectivity for ports, coal, steel, fertilizer and food grains, with Rs.15,000 crores set aside for private investors. As transportation eases, the prices of these goods can be reasonably expected to see a decline.

The revival of fifty additional airports, heliports, water aerodromes and advance landing grounds was also announced with the intent of improving regional air connectivity.

These developments are in alignment with the National Logistics Policy, announced by the Prime Minister, Mr. Narendra Modi, on 17 September, 2022 which is aimed at building a technology-enabled, integrated and cost-effective logistics ecosystem in India.

III. Manufacturing Sector

The manufacturing sector saw a number of concessions/incentives in this Budget:


Relief on custom duty on certain parts of mobile phones, like camera lens, to promote domestic manufacturing of mobile phones;


Exemptions of basic custom duty on ethyl alcohol to promote the chemical industry, reduction of basic custom duty on acid grade fluorspar to make domestic fluorochemicals industry more competitive and reduction of basic custom duty on crude glycerin to promote manufacture of epicholorhydrin;

Reduction of basic custom duty rate on the Lab Grown Diamond seeds with the view to promote the indigenous production of these environment friendly diamonds;


Continuation of the exemption of basic custom duty on raw materials for manufacture of CRGO Steel, ferrous scrap and nickel cathode to facilitate the availability of raw materials for the steel sector; and

Electric Vehicles

Exemption of custom duty on import of capital goods and machinery required for the manufacture of lithium-ion cells for batteries used in electric vehicles to promote the manufacture of electric vehicles.

These developments are consistent with the Union’s Make in India initiative which is directed at facilitating investment and foster innovation.

The Economic Survey, tabled by Finance Minister, one day prior to the issuance of the Union Budget 2023-24, recognized that the Production-Linked Incentive Scheme, PM Gati Shakti and the National Logistics Policy together will bring competitiveness in India’s domestic manufacturing and export activities.

IV. Prominent Changes in The Financial Sector

The Budget seeks to setup a number of mechanisms to ease the regulatory and compliance framework in India:

  1. A national financial information registry will be set up to facilitate efficient flow of credit, promote financial inclusion, and foster financial stability;
  2. Central Data Processing Centres will be setup making the process of filing forms with field offices under the Companies Act, 2013 more efficient and expeditious; and
  3. Financial sector regulators will be requested to carry out a comprehensive review of existing regulations in order to simplify and make cost effective the cost of compliances.

The implementation of these proposals will go a long way in improving India’s Ease of Doing Business rankings and act as a catalyst in making India an inviting option for investors.

The Way Forward

The Union Budget 2023-24, with its primary tenets of enhance in growth potential, job creation, crowd-in private investments and providing a cushion against global headwinds, estimates a growth of about 7% in this fiscal year. Here’s hoping that the year sees widespread growth across sectors with ample opportunities for foreign investors to flourish.

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