Union Budget 2024-2025 | 23 Jul 2024

Source: PIB 

Why in News?

Recently, Union Budget 2024-25 was presented in the Parliament. It was the first general budget of the 18th Lok Sabha. 

What are the Major Highlights of the Union Budget 2024-25?  

• Focus Area:  
  • As outlined in the Interim Budget, the focus of the budget remains on four major groups: 'Garib' (Poor), 'Mahilayen' (Women), 'Yuva' (Youth), and 'Annadata' (Farmers) . 
• Budget Theme:  
  • The Union Budget 2024-25 emphasises employment, skilling, support for MSMEs, and the middle class. A significant allocation of Rs 1.48 lakh crore is earmarked for education, employment, and skilling. 
• Budget Priorities:  
  • The budget prioritizes nine areas including agriculture, employment, human resource development, manufacturing, services, urban development, energy security, infrastructure, innovation, research & development, and next-generation reforms. 

• Priority 1: Productivity and Resilience in Agriculture:  
  • Measures include releasing new 109 high-yielding crop varieties, promoting natural farming among 1 crore farmers, establishing 10,000 need-based bio-input bio-input centres, and enhancing production, storage, and marketing of pulses and oilseeds (achieve‘atmanirbharta’ for oil seeds). 
  • A provision of Rs 1.52 lakh crore has been announced for agriculture and allied sectors this year. 
  • Government along with the states, will facilitate the implementation of the Digital Public Infrastructure (DPI) in agriculture for coverage of farmers and their lands in 3 years. 
• Priority 2: Employment & Skilling:  
  • The budget introduces schemes like Employment Linked Incentive and initiatives to boost skilling with a focus on skilling 20 lakh youth over a 5-year period and upgrading 1,000 Industrial Training Institutes.  
    • Financial support for higher education and loans for skilling are also announced. 
  • The Model Skill Loan Scheme will be revised to facilitate loans up to Rs 7.5 lakh with a guarantee from a government promoted fund, which is expected to help 25,000 students every year. 
• Priority 3: Inclusive Human Resource Development and Social Justice:  
  • Enhanced support for economic activities among marginalised groups, including tribal communities and women entrepreneurs, is emphasized.  
  • The government's Purvodaya initiative aims to comprehensively develop the eastern region of India- including Bihar, Jharkhand, West Bengal, Odisha, and Andhra Pradesh, focusing on human resource development, infrastructure enhancement, and economic growth to advance towards a developed nation. 
  • The Finance Minister announced the launch of the Pradhan Mantri Janjatiya Unnat Gram Abhiyan to enhance the socio-economic conditions of tribal communities, covering 63,000 villages in tribal-majority areas and aspirational districts, benefiting approximately 5 crore tribal people. 
  • Over 100 branches of India Post Payment Bank will be established in the North East region to enhance banking services, alongside a provision of Rs 2.66 lakh crore allocated for rural development and infrastructure this year. 
• Priority 4: Manufacturing & Services:  
  • The budget emphasises support for MSMEs, focusing on labour-intensive manufacturing, with a new self-financing guarantee fund offering up to Rs 100 crore per applicant.  
  • Public sector banks will enhance their internal assessment capabilities for MSME credit. Additionally, Mudra loan limits will increase to Rs 20 lakh for previous 'Tarun' category borrowers.  
  • The budget also includes initiatives like setting up 50 food irradiation units, establishing 100 food quality labs, and creating E-Commerce Export Hubs.  
  • Furthermore, a scheme for internships in 500 top companies aims to benefit 1 crore youth over 5 years. 
• Priority 5: Urban Development:  
  • PM Awas Yojana Urban 2.0, has been allocated Rs 10 lakh crore to address housing needs of 1 crore urban poor and middle-class families, with Rs 2.2 lakh crore in central assistance over 5 years.  
  • The government will also collaborate with State Governments and Multilateral Development Banks to promote water supply, sewage treatment, and solid waste management in 100 large cities through bankable projects.  
  • Additionally, building on the success of PM SVANidhi, the government plans to establish 100 weekly street food hubs (haats) annually over the next five years. 
• Priority 6: Energy Security:  
  • PM Surya Ghar Muft Bijli Yojana aims to install rooftop solar plants for free electricity to 1 crore households (up to 300 units every month).  
  • Nuclear energy is highlighted as a significant part of India's energy mix. 
• Priority 7: Infrastructure:  
  • Government will try to maintain strong fiscal support for infrastructure over the next 5 years on this line Rs 11,11,111 crore for capital expenditure has been allocated this year, which is 3.4%  of our GDP. 
  • Phase IV of Pradhan Mantri Gram Sadak Yojana (PMGSY) to connect 25,000 rural habitations with all-weather roads due to population growth has been announced.  
  • For Bihar, under the Accelerated Irrigation Benefit Programme and other sources, the government will allocate Rs 11,500 crore for projects like the Kosi-Mechi intra-state link and 20 other schemes including barrages, river pollution abatement, and irrigation.  
  • Additionally, financial assistance will be provided to Assam, Himachal Pradesh, Uttarakhand, and Sikkim for flood management, landslides, and related projects. 
• Priority 8: Innovation, Research & Development:  
  • The government will establish the Anusandhan National Research Fund to support basic research and prototype development, allocating Rs 1 lakh crore to spur private sector-driven research and innovation at a commercial scale.  
  • To expand the space economy fivefold in the next decade, a venture capital fund of Rs 1,000 crore will be established. 
• Priority 9: Next Generation Reforms:  
  • Plans for an Economic Policy Framework, labour reforms, and simplification of FDI regulations are outlined to spur economic growth. 
  • Jan Vishwas Bill 2.0 to improve Ease of Doing Business will be introduced by the government. 
• Other Highlights: 
  • Economic Policy Framework:  
    • The government will formulate an Economic Policy Framework to guide economic development and reforms for enhancing employment. 
  • Labour related reforms:  
    • Implementing comprehensive labour reforms through integrated portals like e-shram portal, Shram Suvidha and Samadhan portals will be revamped to enhance ease of compliance for industry and trade.  
    • Government will come up with a taxonomy for climate finance for enhancing the availability of capital for climate adaptation and mitigation. 
  • Foreign Direct Investment and Overseas Investment: 
    • The rules and regulations for Foreign Direct Investment and Overseas Investments will be simplified to facilitate foreign direct investments, nudge prioritisation, 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 and on attaining the age of majority, the plan can be converted seamlessly into a normal NPS account. 
  • New Pension Scheme (NPS) 
    • A Committee to review the NPS has been constituted to addresses the relevant issues while maintaining fiscal prudence to protect the common citizens. 
  • Direct Tax Reforms: Comprehensive review and simplification of direct and indirect tax regimes are proposed.  
    • Changes include revised income tax slabs and deductions, simplification of tax compliance, and reforms in capital gains taxation. 
  • Custom Duty Reforms: Rationalization of GST and custom duty rates, exemptions for essential medicines and critical minerals, and measures to promote domestic manufacturing are highlighted. 
  • Dispute Resolution: Initiatives like Vivad se Vishwas Scheme, increased monetary limits for appeals, and measures to streamline transfer pricing assessments are aimed at reducing litigation and providing tax certainty.