Highlights of Union Budget 2024-25 - Analysis & Important points for APSC/ADRE Exams

Highlights of Union Budget 2024-25 – Analysis & Important points for APSC/ADRE Exams

On July 23, 2024, Minister of Finance and Corporate Affairs Smt Nirmala Sitharaman, while presenting the Union Budget 2024-25 in Parliament today said that India’s inflation continues to be low, stable and moving towards the 4% target. Core inflation (non-food, non-fuel) currently is 3.1% and steps are being taken to ensure supplies of perishable goods reach market adequately. India’s economic growth continues to be the shining exception and will remain so in the years ahead.

There is usually only one budget announced in a financial year. But in Lok Sabha election years, there are 2 budget announcements: one in February (like every year) and one in July (after elections).

Download Union Budget 2023-24 Highlights PDF

Highlights & Important Points of full Union Budget 2024-25

Nine Priorities in Union Budget 2024-25

The Finance Minister said, for pursuit of ‘Viksit Bharat’, the budget envisages sustained efforts on the following 9 priorities for generating ample opportunities for all.

Priority 1: Productivity and resilience in Agriculture

Govt will undertake a comprehensive review of the agriculture research setup to bring the focus on raising productivity.
New 109 high-yielding and climate-resilient varieties of 32 field and horticulture crops will be released for cultivation by farmers.
In the next two years, 1 crore farmers across the country will be initiated into natural farming supported by certification and branding.
10,000 need-based bio-input resource centres will be established.
For achieving self-sufficiency in pulses and oilseeds, government will strengthen their production, storage and marketing and to achieve ‘atmanirbharta’ for oil seeds such as mustard, groundnut, sesame, soybean, and sunflower.
Govt will facilitate the implementation of the Digital Public Infrastructure (DPI) in agriculture for coverage of farmers and their lands in 3 years.
A provision of ₹1.52 lakh crore for agriculture and allied sector this year.

Priority 2: Employment & Skilling

Govt will implement 3 schemes for ‘Employment Linked Incentive’, as part of the Prime Minister’s package. These will be based on enrolment in the EPFO, and focus on recognition of first-time employees, and support to employees and employers.
A new centrally sponsored scheme, as the 4^th scheme under the Prime Minister’s package, for skilling in collaboration with state governments and Industry.
20 lakh youth will be skilled over a 5-year period and 1,000 Industrial Training Institutes will be upgraded in hub and spoke arrangements with outcome orientation.
The Model Skill Loan Scheme will be revised to facilitate loans up to ₹7.5 lakh with a guarantee from a government promoted Fund, which is expected to help 25,000 students every year.
Financial support for loans upto ₹10 lakh for higher education in domestic institutions. E-vouchers for this purpose will be given directly to 1 lakh students every year for annual interest subvention of 3 per cent of the loan amount.

Priority 3: Inclusive Human Resource Development and Social Justice

Implementation of schemes meant for supporting economic activities by craftsmen, artisans, self-help groups, scheduled caste, schedule tribe and women entrepreneurs, and street vendors, such as PM Vishwakarma, PM SVANidhi, National Livelihood Missions, and Stand-Up India will be stepped up.
Purvodaya – for the all-round development of the eastern region of the country covering Bihar, Jharkhand, West Bengal, Odisha and Andhra Pradesh. This will cover human resource development, infrastructure, and generation of economic opportunities to make the region an engine to attain Viksit Bharat.
Pradhan Mantri Janjatiya Unnat Gram Abhiyan for improving the socio-economic condition of tribal communities, by adopting saturation coverage for tribal families in tribal-majority villages and aspirational districts covering 63,000 villages and benefitting 5 crore tribal people.
More than 100 branches of India Post Payment Bank will be set up in the North East region to expand the banking services.
A provision of ₹2.66 lakh crore for rural development including rural infrastructure was made this year.

Priority 4: Manufacturing & Services

Support for promotion of MSMEs – special attention to MSMEs and manufacturing, particularly labour-intensive manufacturing.
A separately constituted self-financing guarantee fund will provide, to each applicant, guarantee cover up to ₹100 crore, while the loan amount may be larger.
Public sector banks will build their in-house capability to assess MSMEs for credit, instead of relying on external assessment.
Mudra Loans – limit of Mudra loans will be enhanced to ₹ 20 lakh from the current ₹ 10 lakh for those entrepreneurs who have availed and successfully repaid previous loans under the ‘Tarun’ category.
MSME Units for Food Irradiation, Quality & Safety Testing – Financial support for setting up of 50 multi-product food irradiation units in the MSME sector will be provided.
Setting up of 100 food quality and safety testing labs with NABL accreditation will also be facilitated.
To enable MSMEs and traditional artisans to sell their products in international markets, E-Commerce Export Hubs will be set up in public-private-partnership (PPP) mode .
Internship in Top Companies – Govt will launch a comprehensive scheme for providing internship opportunities in 500 top companies to 1 crore youth in 5 years.

Priority 5: Urban Development

Urban Housing – Under the PM AwasYojana Urban 2.0, housing needs of 1 crore urban poor and middle-class families will be addressed with an investment of ₹ 10 lakh crore. This will include the central assistance of ₹ 2.2 lakh crore in the next 5 years.
Water Supply and Sanitation – Govt will promote water supply, sewage treatment and solid waste management projects and services for 100 large cities through bankable projects.
PM SVANidhi – Govt envisions a scheme to support each year, over the next five years, the development of 100 weekly ‘haats’ or street food hubs in select cities.

Priority 6: Energy Security

PM Surya Ghar Muft Bijli Yojana has been launched to install rooftop solar plants to enable 1 crore households obtain free electricity up to 300 units every month. The scheme has generated remarkable response with more than 1.28 crore registrations and 14 lakh applications.

Priority 7: Infrastructure

Govt will endeavour to maintain strong fiscal support for infrastructure over the next 5 years, in conjunction with imperatives of other priorities and fiscal consolidation.
₹11,11,111 crore for capital expenditure has been allocated this year, which is 3.4 per cent of our GDP.
Pradhan Mantri Gram SadakYojana (PMGSY) – Phase IV of PMGSY will be launched to provide all-weather connectivity to 25,000 rural habitations which have become eligible in view of their population increase.
For Irrigation and Flood Mitigation in Bihar, through the Accelerated Irrigation Benefit Programme and other sources, government will provide financial support for projects with estimated cost of ₹11,500 crore such as the Kosi-Mechi intra-state link and 20 other ongoing and new schemes including barrages, river pollution abatement and irrigation projects.
Govt will also provide assistance to Assam, Himachal Pradesh, Uttarakhand and Sikkim for flood management, landslides and related projects.

Priority 8: Innovation, Research & Development

Govt will operationalize the Anusandhan National Research Fund for basic research and prototype development and set up a mechanism for spurring private sector-driven research and innovation at commercial scale with a financing pool of ₹1 lakh crore in line with the announcement in the interim budget.
Space Economy – continued emphasis on expanding the space economy by 5 times in the next 10 years, a venture capital fund of ₹1,000 crore will be set up.

Priority 9: Next Generation Reforms

Economic Policy Framework – Govt will formulate an Economic Policy Framework to delineate the overarching approach to economic development and set the scope of the next generation of reforms for facilitating employment opportunities and sustaining high growth.
Labour related reforms – Govt will facilitate the provision of a wide array of services to labour, including those for employment and skilling. A comprehensive integration of e-shram portal with other portals will facilitate such one-stop solution. Shram Suvidha and Samadhan portals will be revamped to enhance ease of compliance for industry and trade.

Foreign Direct Investment (FDI) and Overseas Investment

The rules and regulations for Foreign Direct Investment and Overseas Investments will be simplified to (1) facilitate foreign direct investments, (2) nudge prioritization, and (3) promote opportunities for using Indian Rupee as a currency for overseas investments.

NPS Vatsalya – a plan for contribution by parents and guardians for minors will be started. On attaining the age of majority, the plan can be converted seamlessly into a normal NPS account.

New Pension Scheme (NPS) – Committee to review the NPS has made considerable progress in its work and a solution will be evolved which addresses the relevant issues while maintaining fiscal prudence to protect the common citizens.

Income Tax Rules

Budget 2024-25 increased standard deduction of salaried employees from ₹ 50,000/- to ₹ 75,000/- for those opting for new tax regime.
Deduction on family pension for pensioners enhanced from ₹ 15,000/- to ₹ 25,000/-. Assessments now, can be reopened beyond three years up to 5 years from end of year of assessment, only if, the escaped income is more than ₹ 50 Lakh
The new tax regime rate structure is also revised to give a salaried employee benefits up to ₹ 17,500/- in income tax.

Income Slabs	Tax Rate
0 – 3 Lakh rupees	NIL
3 – 7 Lakh rupees	5 per cent
7 – 10 Lakh rupees	10 per cent
10 – 12 Lakh rupees	15 per cent
12 – 15 Lakh rupees	20 per cent
Above 15 Lakh rupees	30 per cent

Changes in capital gains tax

STCG on financial assets increased from 15% to 20%.
LTCG on financial and non-financial assets increased from 10% to 12.5%.
Exemption on LTCG gains increased from Rs 1 lakh to Rs 1.25 lakh.

Increase in STT

Securities Transaction Tax (STT) on:

Futures: increased from 0.0125% to 0.02%.
Options: increased from 0.0625% to 0.10%.

Buyback of shares

Gains from buyback of shares are no more tax-exempt. It would now be taxable like dividends, as per the applicable tax slab.
Further, the cost of such shares shall be treated as a capital loss to the investor

Books for Assam General Knowledge