Budget 2025: 59 percent of Indians are worried about inflation, will the budget provide a solution to this?

From soap to oil, inflation has broken the back of the common man. Marketing data and analytics company Kantar has recently released the findings of the fourth edition of its India Union Budget Survey. This survey reflects the sentiments and expectations of consumers ahead of the Union Budget 2025 to be presented on February 1, 2025. According to Kantar's report, 59 percent of Indians are troubled by inflation. Let us know if they expect relief from inflation in this budget.

Will there be relief in the budget?

Indian consumer sentiment in 2025 reflects a mix of declining confidence and changing expectations. While 67% of Indians believed that the 2024 budget would be according to their needs, this number has been declining steadily since 2022. Amid the slowdown in GDP, optimism about India's economic growth has also decreased. Consumers are demanding relief in income tax, an increase in medical insurance rebates, and measures to tackle inflation. While concerns over misuse of AI and financial security are rising, worries about economic slowdown due to global conflicts have declined compared to last year.

Most people expect the Union Budget 2025 to focus on stimulating economic growth by implementing protectionist policies, thereby addressing challenges such as sustainable development, job creation, and high cost of living.

Survey highlights

Most Indians (67%) believe the 2024 Budget will live up to their expectations, although the percentage of people holding this positive view has declined steadily over the past two years, from 73% in 2022 to 70% in 2023, reflecting a gradual decline in public consensus with the Budget over time.

Amid the recent drop in India's GDP numbers, which are at 6.4% (down from 8.2% last year), 53% of Indians believe that India's economy will still grow faster than in previous years, but this number has also dropped to 57% for 2024.

Indians expect the government to provide income tax relief to the salaried class, especially the middle-income earners, in the upcoming Union Budget.

Increasing the basic income tax exemption limit from the current Rs 3 lakh/US$ 3.6 thousand is the most common expectation.

Increasing the standard deduction from Rs 75 thousand/US$ 892 to Rs 1 lakh/US$ 1.2 thousand.

Most people want to either increase the limit of the highest tax slab from the current Rs 15 lakh/US$ 17.8 thousand or reduce the highest tax rate of 30% applicable on income above Rs 15 lakh/US$ 17.8 thousand.

With the rising threat of the HMPV virus and the increasing incidence of life-threatening lifestyle diseases, the government is expected to increase the limit of various deductions under Section 80 for medical insurance premiums.

There has been a significant rise in the number of consumers surveyed who want an increase in tax exemption on medical/health insurance (from 42% in 2024 to 51% in 2025).

59% of Indians have cited rising inflation as their primary concern, up from 57% last year.

Nearly 50% of Indians are concerned about the misuse of AI, especially its potential to facilitate cybercrime and threaten financial security.

Global concerns over the recession and multi-national conflicts have slightly declined, with 44% and 43% of consumers expressing concern, down from 48% and 45% in 2024, respectively.

In line with recent market volatility, 62% of Indians expect the BSE Sensex to be between 81000-90000 in 2025.

As India’s start-up and the new-age business sector continues to mature, 70% of Indians expect the sector’s financial performance to improve, pointing to a phase of consolidation and stabilization after a period of rapid expansion.

India is moving towards a cashless economy at a rapid pace, with digital payments (UPI and e-wallets) becoming the norm for everyday transactions for 60% of consumers. This is 7% higher than the previous year.

Indian consumers are gradually becoming open to electric mobility due to concerns related to climate change and its impact on the future.

Among those who intend to buy a new vehicle (either 2W or 4W) after 2024, a large proportion (59%) are considering buying an EV.

Personal financial instability, workplace stress, social media pressure, and cyberbullying are among the major causes of mental stress in India.

After Donald Trump's victory in the US elections, 53% of Indians believe that it will have a positive impact on India's exports of products and services, while 20% are adopting a wait-and-watch policy.

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