Finance Minister Nirmala Sitharaman presented the Union Budget 2024-25 in the Parliament on Tuesday, her 7th straight presentation surpassing the record of former prime minister Morarji Desai.
Finance Minister Nirmala Sitharaman presented the Union Budget 2024-25 in the Parliament on Tuesday, her 7th straight presentation surpassing the record of former prime minister Morarji Desai.
This was the first Budget of Prime Minister Narendra Modi's third term in the government and focused on their roadmap for 'Viksit Bharat' by 2047.
People of India have reinforced their faith in the government led by Modi and re-elected it for the third term, she said, while presenting the Budget in Lok Sabha.
"India's economic growth continues to shine while the global economy is still in the grip of policy uncertainty," She added.
The country's inflation remains stable and is approaching 4 percent, with core inflation at 3.1 percent.
While presenting the Budget, FM highlighted nine priorities for this year and coming years.
* Productivity and resilience in Agriculture
* Employment and skilling
* Inclusive HRD and social justice
* Manufacturing and Services
* Urban development
* Energy security
* Infrastructure
* Innovation and Research
* Next Generation Reforms
Key highlights of Union Budget 2024-25:
FM Sitharaman announces Rs 2 lakh crore for 5 new schemes. The focus will be on jobs and skilling of 4.1 crore youth.
* FM proposes to allocate to Rs 1.48 lakh crore for education, employment and skilling.
Announcements for Agriculture sector
* Provision of Rs 1.52 lakh crore for the agriculture and allied sectors.
* 10,000 bio research centres will be established.
* 1 crore farmers across the country will be initiated into natural farming, supported by certification and branding in next 2 years.
* Vegetable production and supply chain, large clusters to be developed closer to consumption centres.
* Financial support for shrimp breeding centres to be provided, export to be facilitated through NABARD.
* Kisan Credit Cards to be launched in 5 states.
* 109 new high-yielding and climate-resilient varieties of 32 field and horticultural crops will be released for cultivation by farmers.
* DPI for coverage of farmers and their lands in 3 years.
* To ensure self-sufficiency in pulses and oil seeds 6 crore farmers and their land will be brought into the farmer and land registry.
* Digital crop survey in 400 districts.
3 schemes announced for ‘Employment Linked Incentive’
Scheme A: First-Time Workers
- One month wage to new entrants in all formal sectors in 3 instalments up to Rs 15,000
- Expected to benefit 210 lakh youth
Scheme B: Job Creation in Manufacturing
- Linked to first time employees
- Incentive to both employee and employer for EPFO contributions in the specified scales for the first 4 years.
- Expected to benefit 30 lakh youth
Scheme C: Support to Employers
- Employers will be reimbursed up to Rs 3,000 per month for two years towards their EPFO contribution for each additional employee.
- The eligibility limit for this reimbursement is a salary of Rs 1 lakh per month, benefiting an estimated 2.1 lakh youths.
- Expected to generate 50 lakh jobs.
Revision of Model Skill Loan Scheme
* Facilitate higher participation of women in the workforce through setting up of working women hostels in collaboration with industry, and establishing creches.
* Model Skill Loan Scheme to be revised to facilitate loons up to Rs 7.5 lakh with a guarantee from a government-promoted fund: expected to help 25,000 students every year.
* Financial support for loans upto Rs 10 lakh for higher education in domestic institutions.
* Direct E-vouchers to be given directly to 1 lakh students every year for annual interest subvention of 3% of loan amount.
Package in a boost to skilling
* 1,000 ITIs to be upgraded in hub & spoke arrangements in 5 years
* Focus on outcome and quality in collaboration with states and industry
* 1 crore youth to be skilled by India's top companies in five years
* 12-month Prime Minister's Internship with monthly allowance of Rs 5,000
Inclusive Human Resource Development and Social Justice
* Plan for endowment rich states in the Eastern parts covering Bihar, Jharkhand, West Bengal, Odisha and Andhra Pradesh for generation of economic opportunities to attain Viksit Bharat.
* Amritsar Kolkata Industrial Corridor with development of an industrial node at Gaya.
* Allocation of more than Rs 3 lakh crore for schemes benefitting women and girls.
* Pradhan Mantri Janjatiya Unnat Gram Abhiyan: Improving the socio-economic condition of tribal communities covering 63,000 villages benefitting 5 crore tribal people.
* More than 100 branches of India Post Payment Bank will be set up in the North East region.
* Andhra Pradesh Reorganization Act:
- Financial support of Rs 15,000 crores will be arranged in FY 24-25.
- Completion of Polavaram Irrigation Project ensuring food security of the nation.
- Essential infrastructure such as water, power, railways and roads in Kopparthy node on the Vishakhapatnam-Chennai Industrial Corridor and Orvakal node on Hyderabad-Bengaluru Industrial Corridor
Announcements for MSMEs
* A new mechanism will be introduced to facilitate the continuation of bank credit to MSMEs during their stress periods.
* The limit for Mudra loans will be increased from Rs 10 lakh to Rs 20 lakh.
* The turnover threshold for buyers to be mandatorily onboarded on the TReDS platform will be reduced from Rs 500 crore to Rs 250 crore.
* Financial support will be provided for 50 multi-product food irradiation units in the MSME sector.
* E-Commerce Export Hubs will be established in a public-private partnership (PPP) mode to help MSMEs and traditional artisans sell their products in international markets.
* Twelve industrial parks under the National Industrial Corridor Development Programme.
* Rental housing with dormitory type accommodation for industrial workers in PPP mode with VGF support.
* Critical Minerals Mission for domestic production, recycling and overseas acquisition.
* Strengthening of the tribunal and appellate tribunals to speed up insolvency resolution and additional tribunals to be established.
* Allowance of Rs 5,000 per month along with a one-time assistance of Rs 6,000 through the CSR funds.
Urban development
* Encouraging states to lower stamp duties for properties purchased by women.
* Envisioning a scheme to develop 100 weekly ‘haats’ or street food hubs in select cities.
* Transit Oriented Development plans for 14 large cities with a population above 30 lakh.
* Promote water supply, sewage treatment and solid waste management projects and services for 100 large cities through bankable projects.
Housing needs
* PM Awas Yojana Urban 2.0: Needs of 1 crore urban poor and middle-class families will be addressed with an investment of Rs 10 lakh crore.
* Enabling policies and regulations for efficient and transparent rental housing markets with enhanced availability will also be put in place.
Energy Security
* Initiatives with private sector in Nuclear Energy
- Setting up Bharat Small Reactors
- R&D of Bharat Small Modular Reactor and newer technologies for nuclear energy
* For electricity storage and facilitation of smooth integration of the growing share of renewable energy.
* A joint venture between NTPC and BHEL will set up a full scale 800 MW commercial plant.
* Financial support for shifting of micro and small industries to cleaner forms of energy.
* Facilitate investment grade energy audit in 60 clusters, next phase expands to 100 clusters.
Infrastructure
* Provision of Rs 11,11,111 crore for infrastructure (3.4% of GDP).
* Rs 1.5 lakh crore to states as long-term interest free loans to support resource allocation.
* Phase IV of PMGSY will be launched to provide all-weather connectivity to 25,000 rural habitations.
Irrigation and Flood Mitigation
* Financial support for projects with estimated cost of ₹11,500 crore such as the Kosi-Mechi intra-state link and 20 other ongoing and new schemes.
* Assistance for flood management and related projects in Assam, Sikkim & Uttarakhand.
* Assistance for reconstruction and rehabilitation in Himachal Pradesh.
Tourism
* Development of Vishnupad Temple Corridor and Mahabodhi Temple Corridor modelled on Kashi Vishwanath Temple Corridor.
* Comprehensive development initiative for Rajgir will be undertaken which holds religious significance for Hindus, Buddhists and Jains.
* The development of Nalanda as a tourist centre besides reviving Nalanda University to its glorious stature.
* Assistance to development of Odisha’s scenic beauty, temples, monuments, craftsmanship, wildlife sanctuaries, natural landscapes and pristine beaches making it an ultimate tourism destination.
Innovation, Research and Development
* Operationalization of the Anusandhan National Research Fund for basic research and prototype development.
* Private sector-driven research and innovation at commercial scale with a financing pool of Rs 1 lakh crore.
* Space Economy: A venture capital fund of Rs 1,000 crore is to be set up.
Next Generation Reforms
* Unique Land Parcel Identification Number or Bhu-Aadhaar for all lands.
* Survey of map sub-divisions as per current ownership.
* Linkages to the farmers’ registries.
* Land records in urban areas will be digitized with GIS mapping.
* Digitization of cadastral maps.
* Establishment of land registry.
* Taxonomy for climate finance: Enhancing the availability of capital for climate adaptation and mitigation related investments.
* FDI and Overseas Investments: Simplified to facilitate FDIs and promote opportunities for using Indian Rupee as a currency for overseas investments.
* NPS Vatsalya: A plan for contribution by parents and guardians for minors.
* Improvement of data governance, collection, processing and management of data and statistics.
* New Pension Scheme (NPS): A solution that address the relevant issues, protects the common citizen and maintains fiscal prudence will be formed.
FY25 Fiscal Deficit projected at 4.9% of GDP
* Expenditure for FY25 seen at 48.21 lakh crore
* Receipts for FY25 32.07 lakh crore
* FY25 Fiscal Deficit projected at 4.9% of GDP versus 5.1% in Interim Budget
* Aim to reach a fiscal deficit of below 4.5% next year
Tax Proposals
* Review of Income Tax Act 1961, Simplification of charities and TDS, Litigation and Appeal, and Deepening the tax base/
* Comprehensive review of the rate structure for ease of trade, removal of duty inversion and reduction of disputes.
Cut in Custom Duties
* Fully exempt 3 more cancer medicines from custom duties.
* Reduce BCD to 15% on Mobile phone, Mobile PCBA and charge.
* Reduce custom duty on gold and silver to 6% and platinum to 6.4%.
* Reduce BCD on shrimp and fish feed to 5%.
* Lithium, Copper, Cobalt exempted from Custom Duty.
* Exempted more capital goods for manufacturing of solar cells & panels.
* Reduce BCD subject to conditions on MDI for manufacturing of spandex yarn from 7.5% to 5%
* Exempt customs duty on manufacturing of connectors
* Exempt customs duty on Oxygen-fused copper
* Fully exempt custom duties on 25 critical mineral.
Announcements on Capital gain taxes
* Short term capital gain tax on certain financial assets revised to 20%
* Long term capital gain tax revised to 12.5% on Financial assets
* TDS rate on e-commerce operators to be cut to 0.1% from 1%
* Increase in limit of exemption of capital gains on financial assets of Rs 1.25 lakh per year.
Employment and Investment
* Abolish ANGEL tax for all classes of investors
* Simpler tax regimen to operate domestic cruise
* Provide for safe harbour rates for foreign mining companies (Selling raw diamonds)
* Corporate tax rate on foreign companies reduced from 40% to 35%.
Tax rate structure revised in new regime
Finance Minister Sitharaman has revised the tax rate structure in the new income tax regime. According to Sitharaman, the revised tax slabs will result in a savings of Rs 17,500 in income tax.
Rs 0-3 lakh - Nil
Rs 3-7 lakh - 5%
Rs 7-10 lakh - 10%
Rs 10-12 lakh - 15%
Rs 15 lakh and above - 30%
* Standard deduction for salaried employees increased from Rs 50,000 to Rs 75,000
* Deduction on family pension for pensioners increased from Rs 15,000 to Rs 25,000
Special focus for development of Bihar, Andhra Pradesh
"We will formulate plan Purvodaya for all round development of Bihar, Jharkhand, West Bengal, Odisha, and Andhra Pradesh," the finance minister said.
The government proposed Rs 26,000 crore for various road projects in Bihar. The finance minister said that the Centre will set up airports, medical colleges and sports infrastructure in Bihar.
* Bihar also got the biggest share of the tourism pie. The centre will develop corridors on the lines of the Kashi Vishwanath temple corridor in Vishnupad temple in Gaya and Mahabodhi temple in Bodhgaya.
* Besides, Nalanda will also be developed as a tourism hub. Rajgir will be developed as a major tourism site keeping in mind its significance for Hindus, Buddhists and Jains.
* Sitharaman also announced that Rs 15,000 crore will be allocated for development of Amravati as Andhra Pradesh's capital.
* Sitharaman further said under the AP Reorganisation Act, for promoting industrial developments, funds will be provided for essential infrastructure such as water, power, railways, and roads and also grants for backward regions of Rayalaseema, Prakasam North coastal Andhra Pradesh, as stated in the Act will be provided.
Expenditure of Major Items
* Defence - Rs 4,54,773 crore
* Rural Development - Rs 2,65,808 crore
* Agriculture and Allied Activities - Rs 1,51,851 crore
* Home Affairs - Rs 1,50,983 crore
* Education - Rs 1,25,638 crore
* IT and Telecom - Rs 1,16,342 crore
* Health - Rs 89,287 crore
* Energy - Rs 68,769 crore
* Social Welfare - Rs 56,501 crore
* Commerce and Industry - Rs 47,559 crore
Allocation to Major Schemes
* MGNREGA - Rs 86,000 crore
* Research and Development Projects - Rs 1,200 crore
* Nuclear power projects - Rs 2,228 crore
* PLI for Pharmaceutical Industry - Rs 2,143 crore
* Development of semiconductors and display manufacturing - Rs 6,903 crore
* Solar Power (Grid) - Rs 10,000 crore
* Direct Benefit Transfer - LPG - Rs 1,500 crore
* Lines of Credit under IDEA Scheme - Rs 3,849 crore