Published on: February 1, 2024
Finance Minister Nirmala Sitharaman took centre stage today, presenting the Interim Union Budget for 2024. While a full-fledged budget awaits the new government after the elections, this strategic roadmap offers a glimpse into the nation’s fiscal future. Buckle up, as we delve into the key takeaways!
Remember, this is an interim budget, meaning it focuses on essential expenditures for the initial months of the new financial year. So, while we might not see sweeping policy changes or major giveaways, the budget still holds significance.
Let’s talk about the few major things that were announced on the Budget Day i.e. February 1, 2024
Fiscal Prudence and Economic Indicators
The interim budget maintains the status quo on direct and indirect tax rates, with the fiscal deficit target for FY25 set at 5.1%. Economic indicators post-budget announcement include a 7.13% 10-year bond rate, USDINR at 82.98, and a 0.4% increase in Nifty at 21812, reflecting a positive market sentiment.
Infrastructure Development and Youth Focus
The finance minister highlighted the government’s focus on infrastructure development, encompassing digital, social, and physical aspects. The budget underscored the importance of empowering the youth, acknowledging their role in national prosperity. The Skill India Mission has made significant strides, equipping 1.4 crore individuals with training, upskilling, and re-skilling 54 lakh youth. Additionally, the initiative has facilitated the establishment of 3000 new Industrial Training Institutes (ITIs). The landscape of institutional higher learning has also evolved, with the creation of prominent institutions including 7 Indian Institutes of Technology (IITs), 16 Indian Institutes of Information Technology (IIITs), 7 Indian Institutes of Management (IIMs), 15 All India Institutes of Medical Sciences (AIIMS), and the establishment of 390 universities.
Inclusive Growth and Social Welfare
The budget articulated the government’s commitment to the welfare of the economically disadvantaged, emphasizing that ‘Garib Kalyan is desh ka kalyan’. The aspiration to fulfil the high aspirations of the young population is a central theme, signalling a commitment to holistic national development.
Transformative Initiatives and Economic Progress
Over the past decade, the budget highlighted the positive impact of initiatives such as the Skill India Mission and the establishment of educational and healthcare institutions. The Goods and Services Tax (GST) regime, recognized for its contribution to tax-based growth, was also mentioned. The budget pointed out a significant 50% increase in the average real income of citizens.
Agriculture, Employment, and Women Empowerment
Agricultural reforms took prominence with increased minimum support prices and financial assistance for farmers under the PM KISAN Yojana. The Pradhan Mantri Fasal Bima Yojana, providing crop insurance to 4 crore farmers, was also noted. The budget then showcased initiatives like PM Mudra Yojana, supporting entrepreneurial aspirations, and legislative reforms and reservation of one-third legislative seats for women.
Infrastructure Boost and Global Engagement
The budget unveiled ambitious plans to electrify one crore households by implementing rooftop solarization initiatives. Under this initiative, these households are set to receive up to 300 units of electricity every month through the utilization of rooftop solar panels. The Defence outlay is set to increase by 11.1%, demonstrating the government’s commitment to national security.
India’s global engagement was acknowledged, with references to the India Middle East Europe Economic Corridor and plans to upgrade rail infrastructure to Vande Bharat standards. The government aims to double the number of airports to 149, with Indian carriers ordering 1,000 new aircraft.
Financial Allocations and Economic Outlook
The finance minister revised down the fiscal deficit for FY24 to 5.8% of GDP, outlining fiscal targets for FY25. Gross market borrowing for FY25 is pegged at ₹14.13 lakh crore, with net borrowing at ₹11.75 lakh crore. Additionally, the union government extended a ₹75,000 crore 50-year interest-free loan to states. FDI inflows from 2014-2023 were reported at $596 billion, and the tax receipts for FY 2024-25 are estimated at ₹26.02 lakh crore, with the average processing time of tax returns reduced to 10 days this year.
