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Union Budget 2024

On July 23, 2024, Finance Minister Nirmala Sitharaman presented the Union Budget for the fiscal year 2024-25. This highly anticipated event outlined the government's spending plans and vision for propelling India's economic growth. Let's delve deeper into the key themes and potential impacts of Budget 2024.


India Budget 2024

Capital Expenditure and Fiscal Deficit


The government has maintained its capital expenditure target for the fiscal year 2025 at ₹11.11 lakh crore, which is 3.4% of the GDP. The fiscal deficit target has been set at 4.9% of the GDP, a reduction from the 5.1% announced in the interim budget.


Focus on Infrastructure and Investment


  • ₹26,000 crore has been allocated for highway development in Bihar, and ₹15,000 crore will be used for infrastructure development in Andhra Pradesh within the current fiscal year.


  • A provision of ₹1.5 lakh crore for long-term interest-free loans will support infrastructure investment by state governments.


Tax Relief and Changes


  • Corporate Tax: The corporate tax rate for foreign companies has been reduced from 40% to 35%.


  • Personal Income Tax: The standard deduction under the new tax regime has been increased to ₹75,000. The revised tax slabs for FY25 are as follows:

Up to ₹3 lakh: NIL


₹3 to ₹7 lakh: 5%


₹7 to ₹10 lakh: 10%


₹10 to ₹12 lakh: 15%


₹12 to ₹15 lakh: 20%


Above ₹15 lakh: 30%


  • These changes are expected to save salaried employees up to ₹17,500 annually in taxes. Additionally, the deduction on family pensions for pensioners has been increased from ₹15,000 to ₹25,000, benefiting around 4 crore individuals


  • Angel Tax: Angel taxes on start-ups have been completely removed, encouraging innovation and entrepreneurship.


  • National Pension System (NPS): The deduction limit for employers' contributions to NPS has been increased from 10% to 14%.

  • Short-term gains on financial assets will now attract a 20% tax rate.


  • Long-term gains on all financial and non-financial assets will be taxed at 12.5%.


  • The exemption limit for capital gains on financial assets has been increased to ₹1.25 lakh per year.

Social and Economic Initiatives


  • Employment and Skilling: Three employment-linked schemes will be launched, based on enrolment in the Employees' Provident Fund Organization (EPFO).


  • Internship Opportunities: A scheme providing internship opportunities in 500 top companies to 1 crore youth over five years, offering a monthly allowance of ₹5,000 and a one-time assistance of ₹6,000 through CSR funds.


  • Pradhan Mantri Gram Sadak Yojana: Phase IV of this scheme will provide all-weather connectivity to 25,000 rural habitations that have become eligible due to population growth.


Innovation and Research


  • Anusandhan National Research Fund: Operationalization of this fund for basic research and prototype development.


  • Private Sector Research: The government will support private sector-driven research and innovation at a commercial scale with a financing pool of ₹1 lakh crore.


  • Space Economy: A venture capital fund of ₹1,000 crore will be established to promote the space sector.


Other Notable Announcements


  • Tourism in Bihar: Development of two new temple corridors in Bihar, modeled after the Kashi Vishwanath Temple Corridor in Varanasi, to promote tourism.


  • Mudra Loans: The limit under the 'Tarun' category of Mudra loans for MSMEs has been increased from ₹10 lakh to ₹20 lakh.


  • Solar Manufacturing: Expansion of the list of exempted capital goods for manufacturing solar cells and panels.


Boost for Housing and Agriculture


  • ₹10 lakh crore allocated for PM Awas Yojana - Urban 2.0 to address housing needs of urban poor and middle class.


  • Initiative to introduce 1 crore farmers to natural farming practices over the next 2 years.


  • Focus on supporting shrimp production and exports.


  • The allocation ₹1.52 Lakh Crore for agriculture will support irrigation, seeds, fertilizers, and crop insurance schemes.


  • New Credit Guarantee Scheme for MSMEs in Agriculture will empower small and medium-sized enterprises in the agricultural sector.


  • Budget 2024 emphasizes the importance of agriculture (krishi) and its allied sectors like animal husbandry, fisheries, and food processing, promoting holistic growth in the agriculture sector.


Focus on Youth and Employment


  • Scheme to provide internship opportunities in top companies for 1 crore youth over 5 years.


  • Pradhan Mantri Gram Sadak Yojana Phase IV to connect 25,000 more rural villages with all-weather roads.


Fiscal Consolidation and Growth


The budget aims to maintain fiscal discipline while fostering economic growth. It targets to bring the fiscal deficit below 4.5% of GDP by the financial year 2025-26.


Decoding the Social Media Buzz 


While official reports provide a detailed analysis, social media offers a glimpse into public perception. Here's a look at some potential areas of discussion based on recent Instagram posts:


  • Increased Infrastructure Spending: Some social media posts might reflect optimism about job creation and economic growth due to the focus on infrastructure spending.


  • Focus on Agriculture: Posts could indicate concerns about whether the support provided to farmers in the budget is sufficient.


  • Free Electricity for Low-Income Families: Social media posts might showcase appreciation for this social welfare initiative.


Conclusion


Budget 2024 presents a comprehensive roadmap for India's growth. While the long-term impact remains to be seen, the focus on infrastructure, agriculture, job creation, and social welfare signifies a commitment to building a stronger and more inclusive India.



 

FAQs


Question: What specific measures are being taken to create jobs?

Answer: The government allocated ₹2 lakh crore for education, employment, and skilling programs, with a focus on the agriculture sector. Additionally, a credit guarantee scheme for MSMEs is planned.


Question: What is the Mudra loan scheme, and how is it being modified?

Answer: The Mudra loan scheme provides loans to small businesses. The budget proposes increasing the loan limit from ₹10 lakh to ₹20 lakh.


Question: Will there be any benefits for low-income families?

Answer: The budget proposes providing free electricity to up to 1 crore poor households.


Question: Will there be continued investment in infrastructure?

Answer: Yes, the government's capital expenditure target remains at ₹11.11 lakh crore for FY25.


Question: What changes are being made to the standard deduction?

Answer: The standard deduction under the new tax regime has been increased to ₹75,000.


Question: What about the corporate tax rate for foreign companies?

Answer: The corporate tax rate for foreign companies has been reduced from 40% to 35%.


Question: What is being done to address housing needs?

Answer: ₹10 lakh crore has been allocated for PM Awas Yojana - Urban 2.0 to support housing needs of the urban poor and middle class.


Question: Are there any initiatives for farmers?

Answer: Yes, the budget includes an initiative to introduce 1 crore farmers to natural farming practices over the next 2 years.


Question: How will the government support youth employment?

Answer: A scheme will provide internship opportunities in top companies for 1 crore youth over 5 years.


Question: Are there plans to improve rural connectivity?

Answer: Yes, Pradhan Mantri Gram Sadak Yojana Phase IV will connect 25,000 more rural villages with all-weather roads.



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