Budget 2024-2025; Major Highlights, Reforms & More

The Union Budget 2024-25, presented by the Finance Minister, outlines the government's financial and policy priorities for the coming fiscal year. The budget focuses on promoting economic growth, enhancing social welfare, and ensuring fiscal prudence. Key areas of focus include infrastructure development, employment and skilling, urban development, energy security, and next-generation reforms.

Global Context and Economic Overview

Despite global economic uncertainties, India's economy remains resilient with low and stable inflation. The government aims to continue this trajectory by focusing on comprehensive development across various sectors.

Infrastructure Development

1. Central and State Investment:
   • The central government has allocated ₹11,11,111 crore for capital expenditure, equivalent to 3.4% of GDP.
   • States are encouraged to match this scale of investment, supported by ₹1.5 lakh crore in long-term interest-free loans.
2. Private Investment:
   • Promotion through viability gap funding and enabling policies, including a market-based financing framework.
3. Pradhan Mantri Gram Sadak Yojana (PMGSY):
   • Phase IV to provide all-weather connectivity to 25,000 rural habitations.
4. Flood Mitigation and Irrigation:
   • Financial support for projects in flood-prone states like Bihar, Assam, Himachal Pradesh, Uttarakhand, and Sikkim, with an estimated cost of ₹11,500 crore for specific projects.
5. Tourism Development:
   • Comprehensive development initiatives for Vishnupad Temple Corridor, Mahabodhi Temple Corridor, Rajgir, and Nalanda.
   • Support for tourism infrastructure in Odisha.

Employment and Skilling

1. Employment Linked Incentive Schemes:
   • Scheme A: Wage support for first-time employees.
   • Scheme B: Job creation incentives in manufacturing.
   • Scheme C: Support for employers hiring additional staff.
2. Women Workforce Participation:
   • Setting up working women hostels, creches, and women-specific skilling programs.
3. New Skilling Program:
   • Collaboration with state governments and industry to skill 20 lakh youth over five years.
4. Education and Skilling Loans:
   • Revised Model Skill Loan Scheme and financial support for higher education loans up to ₹10 lakh.

Download Budget 2024-25 Key Highlights & Notes

Urban Development

1. Cities as Growth Hubs:
   • Development through economic and transit planning, and town planning schemes.
2. Urban Housing:
   • PM Awas Yojana Urban 2.0 aims to address housing needs of 1 crore urban poor and middle-class families with an investment of ₹10 lakh crore.
3. Water Supply and Sanitation:
   • Promotion of water supply, sewage treatment, and solid waste management projects in 100 large cities.
4. Street Markets:
   • Scheme to develop 100 weekly ‘haats’ or street food hubs annually over the next five years.

Energy Security

1. Energy Transition:
   • Policy document on energy transition balancing employment, growth, and environmental sustainability.
2. PM Surya Ghar Muft Bijli Yojana:
   • Installation of rooftop solar plants for 1 crore households, providing free electricity up to 300 units per month.
3. Pumped Storage Policy:
   • Promotion of pumped storage projects for electricity storage.
4. Nuclear Energy:
   • Development of small and modular nuclear reactors in partnership with the private sector.
5. Advanced Thermal Power Plants:
   • Development of Advanced Ultra Super Critical (AUSC) thermal power plants.

Innovation, Research & Development

1. Anusandhan National Research Fund:
   • Operationalization for basic research and prototype development.
   • Private sector-driven research with a financing pool of ₹1 lakh crore.
2. Space Economy:
   • Venture capital fund of ₹1,000 crore to expand the space economy.

Next Generation Reforms

1. Economic Policy Framework:
   • Formulation to delineate the overarching approach to economic development and next-generation reforms.
2. Land-Related Reforms:
   • Unique Land Parcel Identification Number (ULPIN), digitization of cadastral maps, and establishment of land registries.
3. Labour Reforms:
   • Integration of e-shram portal with other portals, revamp of Shram Suvidha & Samadhan portals.
4. Capital and Entrepreneurship:
   • Financial sector vision and strategy document, taxonomy for climate finance, variable capital company structure for financing.
5. Ease of Doing Business:
   • Implementation of Jan Vishwas Bill 2.0 and incentives for state-level business reforms.

Direct Taxes

1. Simplification and Improvement:
   • Comprehensive review of the Income-Tax Act, 1961.
   • Simplified tax regimes for corporate and personal income tax.
2. Charities and TDS Simplification:
   • Merging of two tax exemption regimes for charities, rationalization of TDS rates.
3. Reassessment and Capital Gains:
   • Simplified reassessment provisions, rationalization of capital gains taxation.
4. Taxpayer Services:
   • Digitalization of all major taxpayer services.
5. Litigation and Appeals:
   • Vivad Se Vishwas Scheme, 2024, increased monetary limits for appeals, and expanded safe harbour rules.
6. Investment and Employment Promotion:
   • Abolishment of angel tax, simplified tax regime for cruise tourism, reduced corporate tax rate for foreign companies.

Indirect Taxes

1. GST:
   • Continued efforts to simplify and rationalize the tax structure, expanding it to remaining sectors.
2. Customs Duties:
   • Comprehensive review and rationalization, sector-specific adjustments to support domestic manufacturing and export competitiveness.
3. Sector-Specific Adjustments:
   • Exemptions and reductions for medicines, mobile phones, critical minerals, solar energy, marine products, leather and textile, precious metals, other metals, electronics, chemicals, plastics, and telecommunication equipment.

Conclusion

The Union Budget 2024-25 sets a comprehensive agenda for economic growth, social welfare, and fiscal prudence. Through targeted investments, simplified tax regimes, and sector-specific incentives, the government aims to create a robust foundation for sustainable development and inclusive growth.

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