The Union Budget 2025-26, presented by Finance Minister Nirmala Sitharaman, lays out a roadmap for India’s economic trajectory in an era of global uncertainty. With a focus on fostering inclusive growth, accelerating private sector investments, and strengthening key sectors, the budget aims to propel India towards its vision of ‘Viksit Bharat’ by 2047. The budget’s overarching theme is structured around four key economic engines—Agriculture, MSMEs, Investment, and Exports—powered by policy reforms and guided by an inclusive growth strategy.
One of the most significant announcements in the budget is the revision of personal income tax slabs, providing much-needed relief to middle-class taxpayers. The tax-free income limit has been raised from ₹7 lakh to ₹12 lakh, with a standard deduction of ₹75,000 for salaried individuals. The new tax structure is expected to boost disposable income, spurring consumption and savings. By alleviating the tax burden, this move is expected to revitalize household consumption, which remains a key driver of economic growth.
The government has reinforced its commitment to agricultural growth with the launch of the Prime Minister Dhan-Dhaanya Krishi Yojana, a new initiative aimed at 100 districts to benefit 1.7 crore farmers. Additional measures include the expansion of the Kisan Credit Card (KCC) scheme with an increased loan limit of ₹5 lakh for farmers, fishermen, and dairy farmers, a six-year Pulses Self-Reliance Mission focusing on crops like Tur, Urad, and Masoor to boost domestic production and reduce import dependency, and the National Mission on High Yielding Seeds to strengthen research on climate-resilient and high-yielding seed varieties to ensure sustainable agricultural growth.
A strong emphasis has been placed on fostering innovation and research. A total of ₹20,000 crore has been allocated to research and development for promoting private sector-driven research and technological advancements. The PM Research Fellowship will provide 10,000 fellowships to students pursuing advanced studies in IITs and IISc, while a second Gene Bank for Crop Germplasm will be established with 10 lakh germplasm lines to ensure future food and nutritional security. These measures signal India’s intent to emerge as a global leader in cutting-edge technology and scientific research.
To boost India’s exports and strengthen manufacturing, the budget introduces BharatTradeNet, a digital public infrastructure for seamless trade documentation and financing. Tax exemptions have been announced for key sectors, including duty exemptions on open cells for LED/LCD TVs and capital goods for lithium-ion battery manufacturing. Additionally, the MRO (Maintenance, Repair, and Overhaul) sector will receive a 10-year customs duty exemption for shipbuilding and shipbreaking, and extended time limits for exporting repaired railway goods. These reforms align with India’s broader ‘Make in India’ and ‘Atmanirbhar Bharat’ strategies, ensuring that domestic manufacturing becomes more competitive globally.
With an estimated fiscal deficit of 4.4% of GDP, the government has maintained its commitment to fiscal prudence while ensuring robust capital expenditure. Key initiatives include ₹1.5 lakh crore interest-free loans to states for infrastructure projects, an extension of the Jal Jeevan Mission to 2028 to ensure 100% coverage of rural households with potable tap water, the establishment of an Urban Challenge Fund of ₹1 lakh crore to revamp cities as growth hubs, and encouraging states to leverage public-private partnerships (PPP) for infrastructure growth. These initiatives underscore the government’s focus on long-term economic resilience and sustainability.
The Union Budget 2025-26 balances fiscal responsibility with ambitious growth-oriented policies. By addressing key sectors such as agriculture, manufacturing, innovation, and infrastructure, the budget aims to strengthen India’s economic foundations. The emphasis on tax relief, increased investments, and export competitiveness signals a strategic shift towards making India a global economic powerhouse. As the country navigates complex global economic headwinds, this budget provides a clear blueprint for sustained growth, job creation, and overall economic prosperity. The coming years will determine the effectiveness of these policies, but the direction set by this budget is undeniably forward-looking and transformative.
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