Hope for advertisers: Modi 3.0's thin majority sparks talks of populist Budget
In his first speech after the results of the 2024 Lok Sabha polls on Tuesday, Prime Minister Narendra Modi vowed that his third term in office would be marked by tough decisions. This may be easier said than done given the BJP’s reduced numbers in Parliament. The party, which won 303 seats in Parliament in 2019, now has 240 seats. It will have to seek the support of its allies to cross the halfway mark of 272. In the scenario, industry experts and analysts speculate that the upcoming Budget, which is likely to be tabled on July 1, could be a populist one with more focus on welfare schemes and freebies. They forecast the return of what Atal Behari Vajpayee described as “coalition dharma”-a common manifesto which usually becomes the guiding factor for the coalition government.
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“It's natural for any government to fulfil its electoral promises soon after installation. However, if the government relies on allies for survival, it often ends up appeasing the population with welfare schemes and special packages. Hence, the upcoming budget is expected to focus on populist schemes targeted at lower and middle-income groups,” says the media head of a FMCG major. Welfare schemes often result in more disposable income in consumers' hands which increases their purchasing power. Brands that operate in FMCG, consumer durables, and personal care segments are ready to cash in on the positive consumer sentiments by increasing their media spends, experts said.
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“Welfare schemes and freebies are likely to generate extra disposable income of about Rs 30,000 Cr in the country every month which corresponds to Rs 360,000 Cr annually,” an industry leader guessed. The Chief Marketing Officer of a leading smartphone brand, shared, “When people get extra cash in their accounts, their capacity and willingness to take loans for discretionary spends goes up.” Notably, India's advertising market faced stagnation in the first half of 2024, attributed mainly to two factors: rising unemployment and weak consumer demand driven by inflation, particularly in rural areas. Incidentally, these twin reasons are also believed to have contributed to the perceived anti-incumbency against BJP. Modi's vision, as outlined in BJP's manifesto "Modi ki Guarantee: Developed India 2047", emphasizes economic reforms facilitating ease of labour laws, boosting infrastructure with three bullet trains and expanding Vande Bharat Train Network. He aims to transform India into a manufacturing hub through subsidies and reduced import taxes. Socially, he proposes the Uniform Civil Code and politically, One Nation-One Election. The BJP has also pledged five years of free ration and incentives to small traders and MSMEs to adopt ONDC. Ayushman Bharat Yojana will cover transgenders and seniors over 70. Other promises include piped gas for all households, 30 million new homes, zero electricity bills, uplifting 30 million women to Lakhpati Didis, and raising the Mudra scheme's loan cap to Rs 20 lakh. “However, passing big reforms this time around will be more challenging, as every policy will face closer scrutiny in Parliament and the public eye. Factor reforms like land, labour, and capital may face hurdles in gaining Parliamentary approval,” industry leaders believe. For more updates, be socially connected with us on
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Tags : Advertisers Marketers Bjp Lok Sabha Elections Narendra Modi Union Budget