During a post-budget conversation with the industry stakeholders on February 17, Finance Minister Nirmala Sitharaman sought to address concerns about Foreign Institutional Investor (FII) selling amid global uncertainty. She reassured investors that there is no cause for panic, as India remains a lucrative market, leading to profit booking by FIIs. Government’s Focus on Asset Creation Capital Expenditure The government is committed to asset creation and economic growth, with a planned 10.2% increase in capital expenditure for FY 2025-26, taking the total allocation to ₹16 lakh crore. Of this, the government will directly contribute ₹11.21 lakh crore to fuel infrastructure and development projects. FII Selling in the Equity Market: No Cause for Concern Addressing concerns over FII selling, the Finance Minister explained that India's strong investment climate ensures good returns, leading to profit booking. She highlighted that FIIs typically sell off assets during periods of global economic uncertainty, which should not be a reason for panic. In February alone, FIIs offloaded ₹29,183.43 crore worth of shares. Debt-to-GDP Ratio: Aiming for Stability The government is actively working on reducing the debt-to-GDP ratio by curbing borrowing and adhering to a fiscal glide path. Sitharaman emphasized that while debt reduction remains a priority, it will not compromise the government's planned developmental initiatives. Boosting FDI in the Insurance Sector To enhance competition and deepen penetration in the insurance sector, the government is considering raising the Foreign Direct Investment (FDI) limit. Necessary policy changes are being explored to attract more players and drive growth in the sector. Term Loans for MSMEs: Strengthening Small Businesses For Micro, Small, and Medium Enterprises (MSMEs), the government will now provide term loans, in addition to existing working capital assistance. This initiative, first introduced in the July 2024 budget, aims to help MSMEs invest in plant and machinery, strengthening their growth and expansion prospects. ₹1 Lakh Crore Revenue Loss from Tax Relief, But Higher Savings Expected The recent income tax relief measures will exempt one crore taxpayers from paying taxes. As a result, the government expects a revenue loss of approximately ₹1 lakh crore in direct taxes and ₹2,600 crore in indirect taxes. However, Sitharaman remains optimistic, believing that lower taxes will boost disposable income, leading to higher savings and reinvestments, ultimately benefiting the economy. With these strategic measures, the government aims to drive economic stability, attract investments, and support key industries, reinforcing India’s position as a strong and resilient economy.