Finance Minister Nirmala Sitharaman presented her seventh consecutive budget in Parliament with focus on four major castes: Garib (Poor), Mahilayen (Women), Yuva (Youth), and Annadata (Farmer). The package of five schemes and initiatives introduced in this budget aims to facilitate employment, producing skilling labor force and providing opportunities for countries youth over coming years, focusing on nation energy security and measured for supporting and boosting MSMEs. The government has pledged to present a detailed roadmap for the pursuit of 'Viksit Bharat', focusing on nine priorities: productivity and resilience in agriculture, employment and skilling, inclusive human resource development and social justice, manufacturing & services, urban development, energy security, infrastructure, innovation, research & development, and next-generation reforms. Following are highlights of Union Budget 2024-25.

Highlights of Union budget 2024.

For farming

For agriculture sector and allied sectors the Finance Minister has announced a substantial allocation of Rs 1.52 lakh crore in the 2024 Union Budget.

The minister also announced the government's plan to promote large-scale vegetable production clusters to boost production and ensure a steady vegetable supply across the country.

The government will focus on developing climate-resilient varieties in agriculture. Furthermore, new 109 high-yielding and climate-resilient varieties will be released to farmers, and 10,000 need-based bio-input centers will be established to strengthen the production, storage, and marketing of oilseeds.

The government will also promote digital public infrastructure in partnership with state governments, providing farmers with access to vital information needed from sowing to harvesting such as weather forecasts, crop advisory services, and market prices.

A digital crop survey for Kharif will be conducted in 400 districts in FY25, and Jan Samarth-based Kisan Credit Cards will be enabled in five states. Financing for shrimp farming, processing, and export will be facilitated through the National Bank for Agriculture and Rural Development.

For Employment Linked Incentive

This project is an important step forward in empowering youngsters and assuring a trained workforce for the future.

Governments A scheme will provide one-month wage to those entering the workforce in all formal sectors. The direct benefit transfer of one-month salary in 3 installments to first-time employees, as registered in the EPFO, will be up to Rs. 15,000. The eligibility limit will be a salary of ` 1 lakh per month.

The scheme B will incentivise additional employment into the manufacturing sector linked to the employment of first-time employees. An incentive will be provided at specified scale directly both to the employee and the employer with respect to their EPFO contribution in the first 4 years of employment.

Scheme C pertains to support to employers. It is to be an employer- focused scheme which will focus on additional employment in all sectors for those earning within a salary of 1 lakh. The government will reimburse employers up to Rs. 3000 per month for two years towards EPFO contribution for each additional employee. This scene is expected to incentivise additional employment of 50 lakh persons.

4^th scheme is focused on skilling with focus on skilling 20 lakh youth over 5-year period. 1,000 Industrial Training Institutes will be upgraded in hub and spoke arrangements with outcome orientation. So promote skilling, the government has announced a revision to the model skill loan scheme, allowing loans up to Rs 7.5 lakh, backed by a government-promoted fund, move expected to benefit 25,000 students every year.

The Indian government plans to launch a comprehensive scheme providing internship opportunities in 500 top companies to 1 crore youth over 5 years, offering 12 months of exposure to real-life business environments and varied professions.

For those youth, who couldn’t benefit from current government schemes and policies. The FM announced a financial support for loans up to Rs. 10 lakh for higher education in domestic institutions.  The government will directly provide E-vouchers to 1 lakh students every year for annual interest subvention of 3 per cent of the loan amount. The budget allocation for education, employment, and skilling initiatives increased from Rs 1.48 trillion in the Interim Budget presented before the Lok Sabha elections.

Projects for Bihar and Andhra Pradesh

Modi government has allocated special financial assistance to Bihar and Andhra Pradesh, despite rising demand and political clamour for 'special status'. The FM has allocated Rs 37,500 crores in special funds for states, appeasing and pleasing alliance partners.

Bihar being alliance partner, the government has announced development projects, namely Patna-Purnea Expressway, Buxar-Bhagalpur Expressway, Bodhgaya, Rajgir, Vaishali and Darbhanga spurs, and additional 2-lane bridge over river Ganga at Buxar at a total cost of Rs. 26,000 crore. The finance minister has announced construction of new airports, medical colleges and sports infrastructure, power projects, including setting up of a new 2400 MW power plant at Pirpaint at a cost of Rs. 21,400 cr.

The Finance Minister announced several projects for alliance in Andhra Pradesh during the Union Budget 2024 presentation in Lok Sabha. For current fiscal Rs. 15,000 crore will be arranged for the construction of Amaravati, the new capital of Andhra Pradesh. Sitaraman also announced financial assistance for the completion of the Polavaram irrigation project on the Godavari river, as well as funds for the development of backward areas in Rayalaseema and north Andhra districts. She also announced special incentives for the establishment of industries in Andhra Pradesh and funds for the development of the Visakhapatnam-Chennai and Hyderabad-Bengaluru industrial corridors.

For Women’s

For promoting women-led development, the budget carries an allocation of more than Rs. 3 lakh crore for schemes benefitting women and girls.

For MSME

The government will introduce a credit guarantee scheme for facilitating term loans to MSMEs for purchase of machinery and equipment without collateral or third-party guarantee. The government has also increase the limit of Mudra loans to Rs. 20 lakh from the current Rs. 10 lakh. Public sector banks will build their own in-house capability to assess MSMEs for credit, and will also take a lead in developing a new credit assessment model based on the scoring of digital footprints of MSMEs in the economy.

A new mechanism for facilitating bank credit continuation for MSMEs during stress periods will be announced, providing a government-promoted fund guarantee to support their business and prevent NPA stage entry.

The turnover threshold of buyers for mandatory onboarding on the TReDS platform will be slashed from ₹ 500 crore to ₹ 250 crore. The Budget also has provisions for financial supporting 50 multi-product irradiation units in the MSME sector.

Critical Mineral Mission

The government plans to establish a Critical Mineral Mission for domestic production, recycling, and overseas acquisition of critical minerals, focusing on technology development, skilled workforce, producer responsibility, and financing.

Budget on IBC

The FM announced plans to amend the Insolvency and Bankruptcy Code (IBC) and strengthen related tribunals. The government plans to establish more National Company Law Tribunals (NCLTs) and establish an integrated technology platform to improve outcomes under the IBC. The government also plans to reform and strengthen debt recovery tribunals. The IBC has resolved over 1,000 companies, resulting in direct recovery of Rs 3.3 trillion for creditors. Additionally, 28,000 cases involving Rs 10 trillion have been disposed of before insolvency proceedings.

For Urban Development

The Indian Finance Minister, Nirmala Sitharaman, has outlined nine priorities for urban development in her Budget 2024. These include the digitisation of land records, support for affordable housing, and the introduction of a unique identification number for land or 'Bhu-Aadhaar' in rural areas. The government also proposes a rationization of stamp duty across states, focusing on women homebuyers. Rural land-related actions include ULPIN or Bhu-Aadhaar for all lands, digitization of cadastral maps, survey of map sub-divisions, establishment of land registry, and linking to the farmers registry. The digitization of land records and cadastral maps via GIS mapping will improve transparency in the sector.

The Indian Finance Minister (FM) has announced plans to allocate ₹10 lakh crore for the construction of three crore additional houses under the Pradhan Mantri Awas Yojana (PMAY) in rural and urban areas. This will include central assistance of ₹2.2 lakh crore over the next five years, as well as a provision of interest subsidies to facilitate loans at affordable rates. The PMAY aims to address the housing needs of 1 crore urban poor and middle-class families, ensuring inclusive urban development, stimulating the construction industry, and creating millions of jobs.

For energy security

The finance minister has unveiled a comprehensive set of initiatives to facilitate the country's transition to a more sustainable energy landscape. These initiatives aim to balance economic growth with environmental sustainability, ensuring the country's economic expansion remains robust while addressing climate change challenges. The minister laid out a strategic framework that includes the promotion of renewable energy sources, advancement in nuclear energy technologies, and supportive measures for traditional industries to adopt cleaner and more efficient energy solutions. The budget includes a new policy for promoting pumped storage projects, expansion of the renewable energy sector, collaboration with the private sector on nuclear energy development, advances in thermal power technology, a strategic roadmap for heavy industries, support for traditional industries, the PM Surya Ghar Muft Bijli Yojana, and a policy framework for climate finance and minerals. These initiatives aim to position India as a leader in global energy innovation and climate resilience, enhancing energy security and catalyzing broader economic benefits through advanced industrial development.

For infrastructure

India's federal government has set a record 11.11 trillion rupees ($132.85 billion) spending target for infrastructure. The plan is unchanged from the interim budget presented in February before the national elections. The government has doubled spending on infrastructure over the past three years to boost the economy, with longer-term capital expenditure rising to 3.4% in the current year from 1.7% in 2019-20. The union govt has encouraged state governments to invest in infrastructure, with a provision of Rs. 1.5 lakh crore for long-term interest-free loans. Private sector investment in infrastructure is promoted through viability gap funding and market-based financing framework.

The finance minister has made provision for providing financial support for projects to build flood control structures in various states like Himachal, Uttarakhand, Assam etc.

Innovation, Research & Development

India has allocated Rs 1 trillion innovation fund to boost research and development in India, prototype development, and space economy growth. The fund, called the Powering Innovation, Research & Development (R&D) Anusandhan National Research Fund, will provide long-term financing with low or no interest rates. The fund will support basic research and prototype development, encouraging private sector-driven research on a commercial scale. The budget also includes a dedicated venture capital fund worth Rs 1,000 crore aimed at multiplying India's space economy by five times over the next decade. This initiative aligns with the growing importance of space technology and its potential to contribute significantly to both national and global economies.

Government Revenue and Ex. Estimates

The 2024-25 budget estimates include total receipts of Rs. 32.07 lakh crore and expenditure of Rs. 48.21 lakh crore, with net tax receipts of Rs. 25.83 lakh crore. The fiscal deficit is estimated to be 4.9% of GDP. The government aims to maintain a fiscal deficit below 4.5 per cent next year, ensuring Central Government debt declines as a percentage of GDP.

Budget on Indirect tax

The government through this budget has proposed several customs duty proposals to support domestic manufacturing, deepen local value addition, promote export competitiveness, and simplify taxation while maintaining the interest of the general public and consumers.

The government proposes to fully exempt three more medicines from customs duties and changes in the Base Cost of Deduction (BCD) on x-ray tubes & flat panel detectors for use in medical x-ray machines under the Phased Manufacturing Programme. The FM also proposes to reduce the BCD on mobile phones, mobile PCBA, and mobile charger to 15% in the interest of consumers.

Critical minerals such as lithium, copper, cobalt, and rare earth elements are critical for sectors like nuclear energy, renewable energy, space, defense, telecommunications, and high-tech electronics. The government proposes to fully exempt customs duties on 25 critical minerals and reduce BCD on two of them. To support the energy transition, the Prime Minister proposes to expand the list of exempted capital goods for use in the manufacture of solar cells and panels in the country.

The government has proposed to reduce customs duties on gold and silver to 6% and that on platinum to 6.4 per cent. To promote domestic aviation and boat & ship MRO, the Finance Minister proposes to extend the period for export of goods imported for repairs from six months to one year and the time-limit for re-import of goods for repairs under warranty from three to five years.

Budget on Direct Taxes

Sitharaman proposes merging two tax exemption regimes for charities and Tax Deducted at Source (TDS). The 5% TDS rate on payments will be reduced to 2%, while the 20% rate on unit repurchase by mutual funds or UTI will be withdrawn. The TDS rate on e-commerce operators will be reduced from 1% to 0.1%. Credit for TDS will be deducted on salary, and delays will be decriminalized.

Long-term capital gains tax (LTCG) has been hiked to 12.5% from 10% on all financial and non-financial assets. The limit of LTCG exemption will be hiked to Rs 1.25 lakh from Rs 1 lakh in certain cases. Short-term capital gains (STCG) tax has been too hiked on certain financial securities to 20% from 15%.

Unlisted bonds and debentures, debt mutual funds and market linked debentures, irrespective of holding period will attract tax on capital gains at applicable rates.

The Finance Minister said share buybacks, announced by companies, will be taxed in the hands of the recipient. Security Transaction Tax (STT) on options has been increased from 0.062% to 0.1%, and on futures from 0.0125% to 0.02%, effective October 1st

Standard deduction for salaried employees is increased from Rs. 50,000/- to Rs. 75,000/-. Similarly, deduction on family pension for pensioners is proposed to be enhanced from ₹ 15,000/- to ₹ 25,000/-.