Finance Minister Nirmala Sitharaman created history by presenting her seventh consecutive budget on Tuesday for 2024-25, surpassing former prime minister Morarji Desai's record. This budget, the first of the Modi government's third term, is anticipated to emphasize post-pandemic fiscal consolidation while pursuing long-term goals under the banner of Vikshit Bharat.
In this significant budget, the government focuses on stimulating consumption by offering tax benefits to the middle class. Other priority areas include agriculture, capital expenditure, infrastructure spending, and a push for manufacturing. With India emerging as a key player in global growth, the budget will likely address major trends such as global offshoring, digitalization, and energy transition.
One of the budget’s highlights is its commitment to women-led development, with over Rs 3 lakh crore allocated for schemes benefiting women and girls. Sitharaman announced the establishment of working women hostels to enhance women's participation in the workforce. Additionally, three employment-linked schemes will be launched, targeting enrolment in the Employees' Provident Fund Organization (EPFO).
Scheme A will provide one month’s wage to new workforce entrants across all sectors. Scheme B will incentivize additional employment in the manufacturing sector, particularly for first-time employees, by offering direct incentives related to EPFO contributions for the first four years of employment. This scheme is expected to benefit 30 lakh youth and their employers. Scheme C will cover additional employment in all sectors, with the government reimbursing employers up to Rs 3,000 per month for two years towards EPFO contributions for each additional employee earning a salary of up to Rs 1 lakh per month. This scheme aims to incentivize the additional employment of 50 lakh people.
Sitharaman also announced measures to support the development of climate-resilient seeds by providing funds to the private sector and domain experts. Furthermore, a credit guarantee scheme for MSMEs will be introduced to facilitate term loans without collateral or third-party guarantees. Public sector banks will build in-house capabilities for credit assessment of MSMEs, and the turnover threshold for mandatory onboarding on the TReDs platform will be reduced from Rs 500 crore to Rs 250 crore. SIDBI will open 24 new branches to serve MSME clusters.
For rural development, Rs 2.66 lakh crore has been allocated. The government will launch the Pradhan Mantri Janjati Adivasi Nyaya Maha Abhiyan (PM JANMAN) under a saturation drive. In Bihar, an outlay of Rs 26,000 crore is proposed for various road projects, with financial assistance arranged through multilateral development agencies. Additionally, airports, medical colleges, and sports infrastructure will be established in Bihar. The 'Purvodaya' plan will be formulated for the comprehensive development of Bihar, Jharkhand, West Bengal, Odisha, and Andhra Pradesh, including the support of an industrial corridor for the eastern region.
The budget also includes direct e-vouchers for 1 lakh students annually, with an interest subvention of 3% on the loan amount. This move aims to further support education and skill development in India.
Overall, the 2024-25 Union Budget aims to address key areas of growth and development, reinforcing the government's commitment to economic progress and inclusive development.