The Union Budget is approaching, and the sector and experts have a long list of expectations. We anticipate a balanced budget with a strong emphasis on social spending and the rural economy, as well as the MSME sector. On the spending side, we expect the Budget to place a greater emphasis on CAPEX and project execution, which we believe took a back seat in FY22 after a stellar FY21, owing to COVID-related spending such as free food grains, increased spending for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), and universal free vaccinations. We also expect the government to continue to boost domestic consumption as a result of the prolonged pandemic, with continuous assistance for the economically disadvantaged. The Budget will face some income constraints as a result of an expected slowdown in indirect tax growth following the recent excise duty relief. In addition, GST reductions in a few sectors to stimulate demand may reduce indirect tax collections. In this context, the government's ability to raise direct taxes and disinvestment receipts will be critical in determining fiscal consolidation in FY23. Furthermore, the success of LIC's initial public offering (IPO) and all pending divestments are expected to play a significant role in meeting the government's divestment targets in FY23. As a result, the fiscal deficit for FY23 is expected to range between 5.5 and 6.5 percent.