Budget 2025 Expectations: Inclusion of Fertility Treatments in Health Schemes Expected from Sitharaman's Economic Blueprint

Sensex, Nifty today: The RBI’s announcement of measures to boost the liquidity in the banking system by around Rs 1.5 trillion is positive for the market. This raises the prospects of a rate cut by the MPC in the February policy meeting. Banks are likely to benefit, said V K Vijayakumar, chief investment strategist at Geojit Financial Services.

"After the correction the market is now trading at fair valuations which are in line with long-term (10-year) averages. Investors can utilise the opportunity to buy fundamentally strong high quality stocks. The outperformance of largecaps over mid-and smallcaps is a healthy trend," he said.

FY26 budget will be made at the crossroads of lower growth and sticky inflation, said Ankita Pathak, chief macro and global strategist at Ionic Wealth by Angel One.

"In my opinion, fiscal consolidation is inevitable and GOI is likely to roll back the fiscal deficit to 4.5% of GDP, which goes well with policy continuity. It will also add credibility to the fiscal stance. However, the question is what will then support growth. From above 7%, India’s growth expectations have been tapered to under 6%," she added.

Policy support will be needed for revival. We believe fiscal consolidation will open space for monetary reflation.

Nifty IT remains on a choppy road

"On the sectoral front, IT appears extremely vulnerable to a bear attack due to the sudden rise of the Chinese AI app DeepSeek, which has become the top-rated free app on the Apple App Store. Additionally, Nifty Pharma is looking particularly weak after a significant breakdown, further adding to the sectoral concerns," Rupak De, senior technical analyst, LKP Securities.

LTCG, STCG: In the last budget, there was a dual impact of STT increase and LTCG increase (on listed shares) on the users with an increase in trading costs as well as impact on profitability of the users, said Devam Sardana, business head, Lemonn.

"Given that the revenue generation would have significantly increased with STT, this can potentially be used to revert the LTCG to 10% in order to ensure even higher market participation and incentivise long-term investment which is critical for the users and the capital market stability. This can also address reduction in the flight of capital from India towards global markets and potentially contribute to rupee appreciation as well," he further said.

"As we await the Union Budget for 2025, I believe the education sector is at a pivotal moment. To empower our children to succeed in an increasingly dynamic world, it is essential to prioritize investments in education. I urge the government to allocate a larger share of GDP to education, increase funding for STEM initiatives, enhance digital learning infrastructure and promote skill-based education. By simplifying regulatory processes and encouraging international collaborations, we can create a world-class education system that equips our students to excel on the global stage. Furthermore, fostering a culture of innovation and critical thinking in our schools will be crucial to developing the leaders of tomorrow. I also hope the budget will address the need for equitable access to quality education, ensuring no child is left behind. I look forward to a budget that lays the foundation for a brighter future for our children," said Ajay Singh, Principal, The Scindia School, Gwalior.

"As we look ahead to the Union Budget 2025, the focus on ESG (Environmental Social Governance) principles is more important than ever. Investors and consumers increasingly expect companies to be transparent and accountable in managing their environmental and social impacts. A commitment to ESG reduces long-term risks and aligns businesses with global sustainability goals. The Budget must include subsidies for green technology, tax incentives for ESG-compliant companies, and strong investments in renewable energy, waste management, and sustainable infrastructure. Companies that adopt these practices will have potential tax incentives and reputational boost.

Alongside this, the rise of AI and digital transformation highlights the need for India to adapt its legal framework to support both innovation and accountability. As AI becomes integral to various sectors, there’s an urgent need for comprehensive laws on data protection, ethical usage, and liability. The Budget should offer an opportunity to fund AI governance initiatives that ensure safe and responsible technological growth while safeguarding privacy and data security," said Anisha Pattnaik , Angel Investor, Founder, Lexstart.

"Urban demand has been on a downward trend for five consecutive quarters, with middle and lower-income households cutting back on spending, even on essential items. High food inflation is also impacting consumers in rural and semi-urban regions. The upcoming Budget should prioritize reducing the tax burden on salaried individuals and MSMEs to encourage higher consumption and investment.

The government has placed significant focus on the infrastructure sector, and we would like to see further allocations in this area. Railways, roads, highways, along with water desalination and sewage treatment plants, should remain key priorities in the budget," said Diwakar Rana, Fund Manager, PMS at Prudent Equity.

"The upcoming Union Budget 2025, is expected to introduce several measures to bolster India's startup ecosystem and infrastructure development. Startups and investors alike have expectations over the simplification of tax structure, further tax reliefs for startups, and easier access to capital.

The Indian budget is expected to address several critical areas, with a focus on driving innovation, promoting economic growth, and giving a push to the startup ecosystem.

The introduction of new schemes, or expansion of existing funds for companies in deep-tech sectors, such as AI, blockchain, and clean energy would also be beneficial for the startup ecosystem. AI is set to play a major role in technological advancements and there is a demand from investors and founders for adequate budget allocations for developing world-class AI Infrastructure to support this sector.

With an eye on increasing foreign investments and private-sector participation, we might also see policy reforms aimed at reducing barriers for foreign investors. Initiatives may be designed to unlock more institutional capital, especially in high-growth sectors such as deep-tech and electric vehicles (EVs).

These moves are expected to foster innovation, drive investments, and enhance India's global position in technology and infrastructure development," said Neha Singh, cofounder, Tracxn.

“As artificial intelligence (AI) continues to dominate the global tech landscape, the Indian government has a unique opportunity to accelerate its progress in this transformative field. With India’s digital economy projected to reach $1 trillion by 2028, the Union Budget 2025 should make AI a central focus. Building on the Rs 10,300 crore allocation for the India AI Mission, there is a strong expectation for a marked increase in budgetary allocation for R&D, particularly in AI, machine learning, quantum computing, and blockchain. Furthermore, creating government-funded AI innovation centers and offering tax incentives for AI investments can foster multi-stakeholder collaborations, boost innovation, and reduce reliance on imported AI-specific hardware," said Poonam Mehta, Manager, Technology Research & Advisory, Aranca.

“The upcoming GOI Budget is a chance to address key challenges while driving sustainable and inclusive growth. I’d like to see strong investment in digital infrastructure and skill development, particularly for underserved communities, to ensure equitable progress. The budget should also address the evolution of AI as it presents both opportunities & challenges. It is essential to enable informed and effective AI adoption in the business, operations, and economy in general. We need to ensure we are allocating the required resources and consideration to promote and support Businesses and innovations in this segment, which will eventually help the overall economy make the shift. Especially, our workforce should be well versed to leverage the technology and the changing industry landscape owing to it.

Public-private partnerships in education will also be key if the gaps between academia & industries are to be bridged. With the right focus, this budget can set the stage for a future built on innovation & responsible technology adoption," said Firoz Thairinil, Founder & Chief Executive Officer, UniAthena.

Zepto CFO Ramesh Bafna expects following reforms in the upcoming budget,

1. Ease of Doing Business: A 3S Framework
To foster a business-friendly environment, we advocate for the 3S strategy: Simplify, Standardise, and Seamless. Specific recommendations include:

• Streamlining PPOB and APOB registrations across India to reduce operational hurdles.

• Introducing an accreditation program for large corporations to enable single-click registrations for regulatory approvals like GST APOB, FSSAI, and drug safety compliance.

• Adopting an "Assisted Compliance" approach: Transitioning from enforcement to partnership by offering APIs for FastTag and e-way bill data to corporates, empowering CFOs and auditors to proactively address risks.

2. ESOP Tax Reform: Addressing Dry Tax Liabilities
Current ESOP taxation subjects employees to tax liabilities at the time of exercise, often before any liquidity event. To alleviate this burden, we recommend:

• Implementing minimal STT-equivalent taxes during stock exercise.

• Collaborating with demat providers and brokers to create tech-enabled solutions for tax liens and withholding mechanisms.

3. CIBIL Credit for Direct Tax Payments
To incentivise tax compliance, we propose assigning CIBIL credit points (e.g., 25-100 points) for timely and significant tax payments, along with demerits for tax penalties. This measure would encourage a culture of accountability while rewarding responsible taxpayers."

"We propose a reduction in the TDS on VDA transactions from the current 1% to 0.01%. This adjustment would significantly ease compliance challenges and promote market transparency while ensuring the tracking and tracing of transactions and boosting tax revenues. Additionally, we recommend raising the TDS applicability threshold from Rs 10,000/50,000 to Rs 5,00,000. This would protect small investors and traders from undue tax burdens, ensuring fair treatment across the board," said Ashish Singhal, Co-founder, CoinSwitch.

"To further support the industry’s growth, we advocate for aligning the taxation of VDA income with other asset classes and removing the current discriminatory treatment," he further added.

"On the real estate front, anything that makes regulatory approvals easier for developers would be applauded by the markets. When we spoke to a listed developer, they mentioned that licensing and regulatory approvals could take up to 5 years and cost upwards of 50 Crores," said Anchal Kansal, research analyst at Green Portfolio, SEBI Registered PMS.

"This delay compels developers to lock in a large portion of their working capital for a prolonged period, and this is deterring growth. An introduction of a single window clearance system would provide the much needed boost for the real estate sector’s big leap," she added.

"As we approach the new budget, I'm excited to see how the government builds on the momentum of previous years to drive growth in India's MSME sector. Sustaining this momentum is crucial, with a focus on bridging the swelling debt funding gap that persists for SMEs. Enhancing credit accessibility and simplifying IPO listing procedures will offer vital support. Furthermore, by introducing targeted interest subvention schemes, the government can significantly reduce operational costs. Together, these measures will strengthen the global competitiveness of our MSMEs, ensuring they continue to thrive and grow. To take it to the next level, I'd like to see the budget introduce innovative funding models and asset-light strategies that promote corporate governance and financial transparency. Policy incentives, including tax reliefs, sector-specific subsidies, and support for digital transformation, will be crucial in driving sustainable growth and long-term value creation," said Tarun Singh, Founder at Highbrow Securities.

"Over the last few years, there has been an increased commitment from the Indian government towards healthcare through initiatives like Ayushman Bharat, Pradhan Mantri Suraksha Bima Yojana, Mission Parivar Vikas, and Pradhan Mantri Surakshit Matritva Abhiyan. While these initiatives have significantly advanced many areas of healthcare, the fertility space requires a higher impetus. Fertility treatments such as IVF are still not covered under Ayushman Bharat or other key health schemes, limiting accessibility for many who need it," said Abhishek Aggrawal, Chief Executive Officer, Birla Fertility and IVF.

"As we await Budget 2025, it is crucial for the government to focus on further enhancing the inclusivity of the healthcare system, particularly for fertility-related treatments. We recommend the inclusion of fertility treatments under the Ayushman Bharat scheme to improve access for economically disadvantaged groups. Additionally, the government should consider tax incentives for fertility treatments and extend their coverage in health insurance policies. We also propose the establishment of a nation," he added.

"As we gear up for the Union Budget, we are optimistic about the government’s continued focus on promoting digital payments and strengthening financial inclusion. We hope this Budget will aim to address key areas such as easing regulatory frameworks, incentivizing digital adoption, and boosting credit access for MSMEs. Such steps will ensure that fintech remains a catalyst for India’s growth story and pave the way for a truly inclusive economy," said Nalin Negi, CEO, BharatPe.

"A continued emphasis on fiscal prudence is expected, with the government committed to maintaining a sub-4.5% fiscal deficit target for FY26. Public capex, infrastructure development, and employment creation are likely to remain priorities, reflecting sustained improvements in spending quality. However, nominal GDP projections remain subdued. While direct tax collections may witness healthy growth, indirect tax collections could be impacted by a global tariff war. A significant overhaul of direct taxes or material relief on personal income tax is not anticipated, though boosting consumption may feature in broader reforms," said Pradeep Gupta, Head of Investment at Lighthouse Canton.

"The extent of fiscal space from the RBI’s dividend payout remains uncertain. Estimates suggest the government may undershoot the current fiscal’s capex target by INR 1 trillion. For FY25, capex growth of 10%-12% is anticipated, alongside continued PLI-linked incentives to support manufacturing. Addressing the distorted demand outlook and lagging private capex will be critical," he added.

"The VC ecosystem thrives on favorable capital gains tax policies. Rationalising long-term capital gains (LTCG) tax rates for unlisted shares to match those of listed equities would encourage more domestic and foreign investments in startups. A stable and simplified tax regime is essential to attract patient capital, which is crucial for high-growth sectors like deep tech and clean energy," said Nitin Jain, Chair, Start Up Committee, PHDCCI

"The edible oil industry stands at a critical juncture as we continue to balance global market dynamics with domestic challenges. For this Budget, I believe a focused push toward enhancing oilseed cultivation and encouraging investments in advanced refining technologies can truly transform the sector. It's equally important to address infrastructure gaps that often inflate logistics costs, impacting affordability for consumers. I’m optimistic that the government will also explore policies to stabilize input costs and promote sustainable practices, which are key for long-term growth. With a forward-looking approach, India can significantly reduce its reliance on imports and create a self-reliant edible oil ecosystem," said Anubhav Agarwal, CEO, BN Group.

"Simplifying processes for electronics imports while promoting domestic manufacturing is essential for innovation and competitiveness in high-tech industries. We are optimistic that Budget 2025 will drive sustainable growth, foster innovation, and position India as a resilient, globally competitive economy," said Rahul Garg, Founder, Moglix.

"We are hopeful that the upcoming Union Budget will include impactful measures to address the dual challenges of rising air pollution and sustainable energy transition. Bioenergy, as a clean and renewable source, holds immense potential in tackling these issues while supporting India’s energy security goals," said Varun Puri, Managing Director, Green Power International.

"We look forward to policy initiatives that incentivize the setup of bioenergy plants, offer subsidies for advanced energy equipment, and provide financial support for importing cutting-edge clean energy technologies. Simplifying regulatory processes and offering tax benefits for the adoption of sustainable energy solutions will further encourage industries to transition to greener alternatives," he noted.