India's Union Budget 2024-25: Key Highlights and Implications

In July 2024, India's Finance Minister Nirmala Sitharaman presented the Union Budget for the fiscal year 2024-25. This budget aims to guide India’s growth and development over the next year, with long-term goals to make the country a fully developed nation by the year 2047. One of the main focuses of the budget is infrastructure development. The government allocated more than eleven lakh crore rupees for capital expenditure. This money is meant to build roads, railways, ports, and other physical infrastructure that can help India grow faster. The budget also sets financial targets. The government plans to keep the fiscal deficit at 4.9 percent of the gross domestic product (GDP) for the year 2024-25. A fiscal deficit is the gap between what the government spends and what it earns. There is a goal to reduce this to 4.5 percent in the next year, which shows an intention to manage finances carefully. A new part of the budget includes three new schemes costing about two trillion rupees over the next five years. These schemes focus on direct cash transfers to people who are entering formal jobs for the first time. This is meant to help young workers and those starting new careers. The budget also makes changes to taxes. Personal income tax slabs were revised to provide relief for taxpayers. Rates now start at 0 percent for income up to three lakh rupees and go up to 30 percent for income above fifteen lakh rupees. The standard deduction for salaried employees was increased from fifty thousand to seventy-five thousand rupees, giving workers more tax relief. Additionally, the government raised the exemption limit for capital gains to one lakh twenty-five thousand rupees per year for middle and upper middle-class taxpayers. All rental income from residential properties is now taxed as 'income from house property' rather than as profits from business, changing how rental income is taxed. In agriculture, the government increased allocations to around 1.52 lakh crore rupees, an increase of over 8 percent from the previous year. This supports farmers and related sectors. Education and skills development also received significant attention. About one trillion four hundred eighty billion rupees were allocated to programs for education, employment, and skilling. The focus is on upgrading industrial training institutes and promoting various skilling initiatives to prepare young people for future jobs. Research and development are emphasized too. The budget increased the allocation for the Department of Scientific and Industrial Research by around ten percent. This will help fund scientific research projects and promote innovation. Health care also saw support through a new scheme to make cancer treatment more affordable. Customs duties were exempted on three cancer drugs: Trastuzumab Deruxtecan, Osimertinib, and Durvalumab, which could lower the cost of treatment. Cybersecurity is another priority. The government allocated three thousand crore rupees to strengthen cybersecurity measures to prevent online fraud and protect data. An additional fifteen hundred crore rupees was assigned to improve laws around data protection. The budget also supports startups, especially in financial technology sectors. About five thousand crore rupees will be provided to a startup fund to help fintech companies grow. Tax holidays and simplified rules are expected to benefit over 2,500 startups. Overall, the 2024-25 budget presents a clear plan to support India’s growth in various sectors. It includes infrastructure projects, social welfare schemes, tax reforms, and support for innovation and health. These initiatives aim to create a strong foundation for India to become a developed country by 2047. The government’s official position is focused on building a Viksit Bharat, or a developed India. By investing in key areas like infrastructure, education, health, and technology, it seeks to improve living standards and economic growth. This budget is a significant step in the country’s long-term development plan.