On Tuesday, Union Finance Minister Nirmala Sitharaman presented the Union Budget 2024-25, outlining a comprehensive plan to boost growth and development across India. The total expenditure is estimated at Rs 48,20,512 crore, with a strong focus on nine priorities:
- Productivity and resilience in agriculture
- Employment and skilling
- Inclusive human resource development and social justice
- Manufacturing and services
- Urban development
- Energy security
- Infrastructure
- Innovation & Research and Development
- Next-generation reforms
Key Focus Areas
In her speech, Sitharaman emphasized four main focus points of the budget under Prime Minister Narendra Modi’s third government: ‘Garib’ (poor), ‘Yuva’ (youth), ‘Annadata’ (farmer), and ‘Nari’ (women). Significant allocations were announced for centrally sponsored schemes like the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), Pradhan Mantri Awas Yojana (Urban), and the Jal Jeevan Mission.
Major Financial Allocations
The budget highlighted substantial financial commitments aimed at fostering growth and ensuring the welfare of various sectors:
- Total Capital Expenditure: Projected at Rs 11,11,111 crore, marking a 16.9% increase over the revised estimates for 2023-2024. The effective capital expenditure is estimated at Rs 15,01,889 crore, an 18.2% increase over the previous year.
- Fiscal and Revenue Deficits: Fiscal deficit is estimated at Rs 16,13,312 crore (4.9% of GDP), and revenue deficit at Rs 5,80,201 crore (1.8% of GDP).
- Social Sector Funding: Allocations include Rs 89,287 crore for health, Rs 1,25,638 crore for education, and Rs 2,65,808 crore for rural development.
- Defence and Subsidies: Expenditure on defence is allocated at Rs 4,54,773 crore, while subsidies (food, fertilizer, and petroleum) are estimated at Rs 3,81,175 crore.
- Interest Payments: Projected at Rs 11,62,940 crore.
- Revenue Receipts: Estimated at Rs 31,29,200 crore, with net tax revenue to the Centre projected at Rs 25,83,499 crore. Non-tax revenue is expected to be Rs 5,45,701 crore. The total capital receipts (including non-debt and debt receipts) are estimated at Rs 15,50,915 crore.
Revised Income Tax Slabs
A significant revision in income tax slabs was announced, aiming to reduce the burden on lower-income earners. The new tax rates are:
- Up to Rs 3 lakh: Nil
- Rs 3 to 7 lakh: 5%
- Rs 7 to 10 lakh: 10%
- Rs 10 to 12 lakh: 15%
- Rs 12 to 15 lakh: 20%
- Over Rs 15 lakh: 30%
Additionally, the standard tax deduction has been proposed to increase from Rs 50,000 to Rs 75,000, with the deduction on family pensions rising from Rs 15,000 to Rs 25,000.
Boosting Key Schemes and Sectors
Significant allocations were made for various centrally sponsored schemes:
- MGNREGS: Rs 60,000 crore
- PM Awas Yojana (Urban): Rs 30,171 crore
- Jal Jeevan Mission: Rs 70,000 crore
- Pradhan Mantri Gram Sadak Yojana: Rs 19,000 crore
The total transfers to states and Union Territories with legislatures are projected at Rs 22,91,182 crore. This reflects a substantial increase over the previous fiscal year.
Encouraging Innovation and Reducing Tax Burdens
In a bid to support startups and innovation, several key measures were introduced:
- Venture Capital Fund: A Rs 1,000 crore fund to push the space economy, targeting a five-fold expansion over the next decade.
- Customs Duty Adjustments: Reduction in basic customs duty on gold and silver to 6%, and platinum to 6.4%. Removal of duty on ferronickel and blister copper, while increasing it to 15% on specified telecom equipment.
- Abolishment of Angel Tax: Removal of the angel tax on investors in India to boost startups, addressing strong opposition from the startup community regarding its expansion last year.
Also read: AgriSURE Fund to Boost Agripreneurs and Rural Enterprises
Focus on Socio-Economic Development
The budget also included significant initiatives aimed at socio-economic development:
- Pradhan Mantri Janjatiya Unnat Gram Abhiyan: Launched to improve the socio-economic conditions of tribal communities, covering 63,000 villages and benefiting 5 crore tribal people.
- Youth Internship Scheme: Providing internship opportunities to 1 crore youths in 500 top companies across India over five years, with an internship allowance of Rs 5,000 per month and a one-time assistance of Rs 6,000.
Special Focus on Bihar and Andhra Pradesh
The budget underscored special initiatives for Bihar and Andhra Pradesh, aimed at ensuring the stability of the current BJP-led NDA government by supporting numerically significant NDA allies.
- Bihar: Financial assistance through aid from multilateral development agencies, development of Vishnupad temple and Mahabodhi temple corridors, and tourism hubs in Rajgir and Nalanda.
- Purvodaya Plan: All-round development plan for Bihar, Jharkhand, West Bengal, Odisha, and Andhra Pradesh.
- Amaravati: Rs 15,000 crore allocated for developing Amaravati as Andhra Pradesh’s capital.
Conclusion
The Union Budget 2024-25 presents a comprehensive plan aimed at fostering growth, development, and inclusivity across India. With substantial allocations across various sectors and a focus on socio-economic development, it sets the stage for sustained progress in the coming years.