The Indian benchmark equity index Sensex rose as much as 270 points on Saturday ahead of the unveiling of the Union Budget at 11am on optimism that the government will increase public investments but continue with its plan of fiscal consolidation.

@ 9.38am, the 30-share BSE benchmark Sensex was up 0.9%, or 262.05 points, at 29,482.17 points, while the 50-share Nifty jumped 0.8%, or 72.25 points, to 8,914.85. The gainers among Sensex stocks included Bharat Heavy Electricals Ltd that rose 2.1% to Rs.276.65, ICICI Bank Ltd rose 1.9% to Rs.341.20 and State Bank of India (SBI) rose 1.5% to Rs.304.30. Among the losers, Hero MotoCorp Ltd fell 0.4% to Rs.2,661, while ITC Ltd fell 0.2% to Rs.392.85 All the BSE sectoral indices were trading in the positive territory.

The realty index was the top gainer, up 1.8%, followed by the capital goods which was up 1.4%. The Bankex and power indices were up 1.2% each. The consumer durables and metals indices were up 0.8% and 0.6%, respectively. The BSE IT and Teck indices were up 0.5%. Finance minister Arun Jaitley’s first full-year budget is expected to provide a concrete blueprint towards economic development, while sticking to fiscal consolidation, and many say it could be a make-or-break case for the government.

Budget is very important for India and Indian equity markets. It is a real test for Modi’s administration, if they can deliver and meet the high expectations of reform and change. Last year’s budget was not that meaningful, because they didn’t have that much time to plan it,” Hertta Alava, director of emerging market funds at FIM Asset Management Ltd, said in an email from Helsinki on Wednesday. “But now they have had time and they need to deliver. If the budget disappoints, equity markets will certainly correct,” she added. Expectations are running high that the budget will be laced with big-bang announcements such a defined time table for the implementation of the goods and services tax (GST), deferment of the general anti-avoidance rules (GAAR), along with incentives to boost manufacturing. Investors are hoping for on increased allocations in railways, roads, power and rural infrastructure, and believe savings generated from lower oil prices will be channelized towards capital expenditure, while maintaining a fiscal deficit in the range of 3.6-3.8% for fiscal 2016. “I’m hopeful that budget will satisfy markets. On revenue side I think the budget will focus on taxation, especially how to broaden the tax base. Also some divestments could be on the agenda to keep the deficit in control. On spending side, education, healthcare and infrastructure should be focus areas,” Alava had said. Meanwhile, the Economy Survey for 2015-16 released on Friday said Asia’s third-largest economy is estimated to grow 8.1-8.5% in the next fiscal year, higher than the 7.4% estimated in 2014-15, according to the new measure of gross domestic product (GDP) at market prices, The economy is on the path of recovery with growth deceleration a thing of the past, according to the survey. The survey also said India should stick to its medium-term fiscal deficit projection of 3% of GDP and look to move towards completely eliminating the revenue deficit to ensure that borrowing is only used for capital formation, while cautioning that risks from a shift in the US monetary policy and turmoil in the euro zone need to be watched. Indian markets, which are usually closed for trade on weekends, were open for trade on Saturday after the Securities and Exchange Board of India (Sebi) last week directed stock exchanges to remain open for trading on the budget day. Market participants had urged to the regulator to keep the markets open on the budget day, so that investors could take investment decisions based on policy initiatives announced by the government. Shares of Bharat Electronics Ltd, Rolta India Ltd, Tata Power Co.Ltd and Larsen and Toubro Ltd extended its rally for the second consecutive session after both the company got defence order of Rs.50,000 crore. Rolta India gained 6.3% to Rs.188.45 while Bharat Electronics rose 2.5% to Rs.3,861.95, Larsen and Toubro Ltd rose 2% to Rs.1,794 and Tata Power Co. Ltd rose 1.4% to Rs.88.50. Bhushan Steel Ltd rose 4.9% to Rs.91.50 after the company on Friday said it had entered into a sale and lease-back arrangement for its oxygen plants in Odisha. The move is expected to ease stress on cash flow.