UNION BUDGET 2025-26

• Finance Minister Nirmala Sitharaman presented her 8th straight Budget on Feb 1, 2025 (surpassed the record of Morarji Desai).
• She quoted Telugu Poet Gurjada Appa Rao famous saying “A country is not its soil; a country is its people”.
• Theme- ‘Sabka Vikas’.
• Defined Reforms as fuel to the engine.
• “Democracy, Demography & Demand” are key pillars of the "Viksit Bharat Journey”. The middle class gives strength to India's growth.
• Principles of Viksit Bharat:
  • Zero Poverty,
  • 100% good quality school Education
  • Healthcare Access,
  • Skilled Labour,
  • Women’s Economic Participation,
  • Farmers making India ‘Food basket of the world’.
• Focus- Garib(poor), Yuva(youth), Annadata(farmer) and Nari(women).
• 4 engines of development- Agriculture, MSME, Investment and Export.
• Proposed to raise FDI limit for insurance from 74 to 100% for those companies investing the entire premium in India.
• Fiscal Deficit, Primary Deficit & Effective Revenue Deficit as % of GDP declining continuously since 2022-23. (Not true for Revenue deficit).
• Proposed 4 Regulatory Frameworks:
  1. High Level Committee for Regulatory Reforms.
  2. Investment Friendliness Index of States.
  3. Mechanism under FSDC (Financial Stability & Development Council)
  4. Jan Vishwas bill 2.0 to decriminalize more than 100 provisions in various laws.

ECONOMIC FIGURES

• Nominal GDP growth rate- 10.1% (estimated for 2025-26).
• Expenditure:
  • Total Expenditure- 50.63 lakh cr.
  • Capital Expenditure- 11.21 lakh cr. (3.1% of GDP).
  • Effective Capital Expenditure- 15.48 lakh cr.
  • Revenue Expenditure- 39.4 lakh cr.
• Receipts:
  • Total Receipts- 50.63 lakh cr.
  • Receipts other than borrowing- 34.96 lakh cr.
  • Capital Receipts- 16.4 lakh cr.
  • Revenue Receipts- 34.2 lakh cr.
• Deficit:
  • Fiscal Deficit- 4.4%.
  • Revenue Deficit- 1.5%.
  • Effective Revenue Deficit- 0.8%.
  • Primary Deficit- 0.3%.
• Debt:
  • Outstanding liabilities- 56.1% of GDP.
  • Target- Reduce Centre’s debt to ~ 50% of GDP by 2030-31.
• Expenditure- Defense> Rural Development > Home Affairs >Agriculture & Allied Activities >Education > Health > Urban Development > IT and Telecom> Energy> Commerce & Industry > Social Welfare > Scientific Department.

Engine 1- Agriculture

• PM Dhan- Dhaanya Krishi Yojna:
  • For 100 low productivity districts.
  • Target- 1.7 cr farmers.
  • Focus- Irrigation, Storage, Credit, Diversification.
• Rural Prosperity and Resilience Programme:
  • To reduce under employment in agriculture.
  • Focus on women, youth and landless.
• 6 Years “Mission Atmanirbharta in Pulses”:
  • Special Focus - Tur, Urad, Masoor.
  • 4 year unlimited procurement by Central agencies NAFED & NCCF.
• 5 Years Mission for Cotton Productivity:
  • Promote extra long staple cotton.
  • Linked with 5F Formulae- Farm- Fibre- Factory-Fashion- Foreign.
• Marine sector Development:
  • Focus- Andaman & Nicobar, Lakshadweep.
  • India- 2nd largest fish producer.
• Makhana Board in Bihar:
  • Improve production, value addition and marketing.
  • Organize Makhana farmers into FPOs.
• National Mission on High- yielding seeds:
  • 100+ new climate resilient seed varieties.
  • Strong R&D push.
• KCC credit- raised from 3 lakh to 5 lakh. Short term loans for 7.7 Crore farmers, fishermen and dairy farmers.
• New Urea Plant in Namrup, Assam.

Engine 2- MSME

• Revised MSME classification- (Investment & Turnover enhanced to 2.5 times & 2 times respectively)
  • Micro- Investment- Rs 2.5 cr; Turnover- Rs 10 cr.
  • Small- Investment- Rs 25 cr; Turnover- Rs 100 cr,
  • Medium- Investment- Rs 125 cr; Turnover- Rs 500 cr.
• Scheme for 1st time entrepreneurs- Term loan up to 2 cr; Target- 5 lakh entrepreneurs over 5 yrs (Women, SC/ST).
• Credit Card for Micro Units- Customized Card with Rs 5 lakh limit; 10 lakh card 1st year for Udyam registered units.
• Food Processing- National Institute in Bihar to boost farmer income and youth entrepreneurship.
• The government will set up a National Manufacturing Mission for furthering “Make In India”.
• 45% of our export

Engine 3- Investment

• Prioritized investment in People, Economy & innovation.
• Saksham Anganwadi & poshan 2.0- Covers 8 cr children, 1cr pregnant/lactating women, 20 lakh adolescent girls.
• Atal Tinkering Labs- 50,000 new labs in govt. schools in next 5 yrs.
• Broadband in all government secondary schools and Primary Health Centers in Rural areas under BharatNet Project.
• Bhartiya Bhasha Pustak Yojna- Digital Indian Language Book for schools and higher education.
• Centre of Excellence in AI- Rs 500 cr outlay.
• Infrastructure upgrade in 5 IITs.
• 200 Day Care Cancer Centres in all districts by 2026.
• Social Security for online workers- Registration on e- Shram portals; PM- JAY health cover for 1 cr gig workers & Gig workers identity card.
• Jal Jeevan Mission- Extended to 2028 for 100% tap connections.
• Nuclear Energy Mission- Target- 100GW by 2047.
• New Greenfield Airport in Bihta, Patna.
• Expansion of Patna Airport.
• Western Koshi Canal Project- to irrigate 50,000 hectares.
• SWAMIH Fund 2- 40,000 housing units in 2025.
• 2nd National Gene Bank – 10 lakh germplasm lines for food & nutritional security.
• Gyan Bharatam Mission- To survey and preserve 1 crore Indian manuscripts. A National Digital Repository of Indian Knowledge System for knowledge sharing is also proposed.
• Top 50 Tourist sites to be developed with states; Focus- Buddhist Circuit.
• Heal in India- Medical Tourism.
• Outlay of 1.5 Lakh crore proposed for 50-years interest free loan to states for Capital Expenditure and incentives for reforms.
• The government will set up an Urban Challenge Fund of Rs 1 Lakh Crore to promote ‘Cities as growth hubs’, ‘creative redevelopment of cities’ etc.
• Rs 20,000 Crore to implement private sector driven R&D.
• Proposed National Geospatial Mission for urban planning.

Engine 4- Export

• To be jointly driven by the Ministry of Finance, Commerce & MSME.
• Export Promotion Mission: Boost credit, MSME exports, tackle non-tariff barriers.
• BharatTradeNet(BTN): A digital public infrastructure; A Unified digital platform for trade & finance.
• Global Supply Chains: Build local capacity in key sectors; enable Industry 4.0.
• A National Framework to Support emerging tier-2 cities to host Global Capability Centres.
• Air Cargo Infra: Upgrade warehousing for perishables; simplify customs.

Tax Reforms

• No tax on income up to ₹12 lakh under new regime.
• Standard deduction increased to ₹75,000. (Salaried individuals with 12.75 lakh not to pay tax)
• Extends time-limit to file updated returns for any assessment year, from the current limit of 2 Years to 4 Years.
• Revised Tax Slabs (New Regime):
  • ₹0–4 lakh: Nil
  • ₹4–8 lakh: 5%
  • ₹8–12 lakh: 10%
  • ₹12–16 lakh: 15%
  • ₹16–20 lakh: 20%
  • ₹20–24 lakh: 25%
  • Above ₹24 lakh: 30%

Rupees comes from

• Borrowing & other Liabilities- 24%.
• Income Tax- 22%.
• GST & other taxes- 18%.
• Corporation tax- 17%.
• Non- Tax Receipts- 9%.
• Union Excise Duties- 5%.
• Custom- 4%.
• Non- Debt Capital Receipts- 1%.

Rupees Goes To

• State’s Share of Taxes & Duties- 22%.
• Interest Payments- 20%.
• Central Sector Scheme- 16%.
• Centrally Sponsored Scheme- 8%.
• Finance Commission & other transfers- 8%.
• Defence- 8%.
• Other Expenditures- 8%.
• Major Subsidies- 6%.
• Pension- 4%.