The Union Budget 2025, presented by Finance Minister Nirmala Sitharaman on February 1, 2025, focuses on boosting economic growth, supporting the middle class, and implementing key reforms across various sectors. Here’s a detailed breakdown of the major announcements and their impact:
1. Taxation Reforms: Relief for the Middle Class
One of the biggest takeaways from the budget is the tax relief for salaried individuals and senior citizens.
The tax exemption threshold has been increased to ₹12 lakh, with a standard deduction of ₹75,000, making income up to ₹12.75 lakh tax-free.
Revised tax slabs aim to simplify the tax structure and reduce the burden on individuals.
The TDS limit on interest for senior citizens has been doubled from ₹50,000 to ₹1 lakh.
The annual limit for TDS on rent has been raised from ₹2.4 lakh to ₹6 lakh.
Impact: These reforms will enhance disposable income, leading to increased consumer spending and economic growth.
2. Boost for Farmers and Agriculture
The government has introduced multiple schemes to support farmers and improve agricultural productivity.
PM Dhan-Dhaanya Krishi Yojana aims to modernize farming techniques.
Kisan Credit Card (KCC) will facilitate loans up to ₹5 lakh for farmers, fishermen, and dairy farmers.
Pulses Self-Reliance Mission will promote the domestic production of pulses to reduce imports.
A dedicated Makhana Board will be set up in Bihar to boost the production and marketing of Makhana.
Impact: These initiatives will improve farmers’ income and strengthen the rural economy.
3. Investment in Research & Innovation
The budget places a strong focus on technology and innovation to drive future growth.
₹20,000 crore allocated for private-sector-driven R&D initiatives.
10,000 PM Research Fellowships for students in IITs and IISc.
A second Gene Bank for Crop Germplasm with 10 lakh germplasm lines for food security.
Impact: This will boost India’s standing in global innovation and help develop new technologies in agriculture, healthcare, and manufacturing.
4. Promoting Exports and Trade
The government has introduced measures to promote exports and facilitate trade.
Customs duty exemptions for LED/LCD TV components, lithium-ion batteries, and shipbuilding materials.
A 10-year tax exemption for ship maintenance and repair services.
Time limits set for finalizing provisional assessments to improve ease of doing business.
Leather industry support through custom duty exemptions on wet blue leather.
Impact: These initiatives will enhance India’s manufacturing and export competitiveness, attracting foreign investments.
5. Budget Estimates and Fiscal Deficit
The total estimated receipts (excluding borrowings) stand at ₹32.07 lakh crore, with total expenditure projected at ₹48.21 lakh crore.
The fiscal deficit is estimated at 4.4% of GDP, showing fiscal prudence while supporting growth initiatives.
Conclusion
The Union Budget 2025 lays a strong foundation for economic development, with a focus on tax relief, agriculture, innovation, and exports. By boosting spending power and simplifying tax structures, it aims to create a more inclusive and prosperous economy. As businesses and individuals adapt to these changes, the impact of this budget will be seen in the coming months.
