Union Budget 2024-2025
On July 23, 2024, Finance Minister Nirmala Sitharaman presented the Union Budget 2024-2025. This budget, which comes as the government led by Prime Minister Narendra Modi begins its third term, outlines an ambitious and inclusive vision for India’s future. Here, we look into the key highlights and initiatives that aim to drive economic growth, create jobs, and enhance the quality of life for all Indians.
A Global Context of Uncertainty
The global economic landscape remains uncertain, with policy ambiguities, elevated asset prices, political instabilities, and shipping disruptions posing significant risks. Despite these challenges, India’s economy stands out with its robust growth and stable, low inflation, moving towards a target of 4%. Core inflation, excluding food and fuel, is at a commendable 3.1%.
Emphasizing Employment, Skilling, and the Middle Class
A primary focus of this year’s budget is on employment, skilling, MSMEs (Micro, Small, and Medium Enterprises), and supporting the middle class. The government has announced a package of five schemes aimed at facilitating opportunities for 4.1 crore youth over five years, with a central outlay of ₹2 lakh crore. Additionally, ₹1.48 lakh crore has been allocated for education, employment, and skilling initiatives.
Nine Key Priorities
The budget outlines nine key priorities to guide India’s path to a developed nation:
- Productivity and Resilience in Agriculture: Efforts include a comprehensive review of the agriculture research setup, release of new high-yielding and climate-resilient crop varieties, promotion of natural farming, and digital public infrastructure for agriculture.
- Employment & Skilling: Three schemes under the Prime Minister’s package focus on employment-linked incentives, including support for first-time employees, job creation in manufacturing, and financial aid to employers for additional hiring.
- Inclusive Human Resource Development and Social Justice: Initiatives include various programs supporting farmers, youth, women, and the poor, with a special focus on the eastern region’s development under the Purvodaya plan.
- Manufacturing & Services: MSMEs receive special attention through a new credit guarantee scheme, revised credit assessment models, and support during stress periods. The budget also promotes MSME units for food irradiation and quality testing, and e-commerce export hubs.
- Urban Development: A continued push towards urbanization with sustainable infrastructure development.
- Energy Security: Ensuring stable and sustainable energy supplies for the nation’s growing demands.
- Infrastructure: Building robust infrastructure to support economic activities across sectors.
- Innovation, Research & Development: Encouraging innovation and research through funding and support for private sector involvement.
- Next Generation Reforms: Introducing reforms that prepare the nation for future economic and social challenges.
Transforming Agriculture
To boost agricultural productivity and resilience, the government plans to release 109 new high-yielding and climate-resilient crop varieties. Additionally, 1 crore farmers will be initiated into natural farming over the next two years, supported by certification and branding initiatives. The budget also strengthens efforts towards achieving self-sufficiency in pulses and oilseeds, and improving vegetable production and supply chains.
Boosting Employment and Skilling
The budget introduces three new schemes for employment-linked incentives:
- First Timers: Provides one-month wage support to all new entrants in the formal workforce.
- Job Creation in Manufacturing: Incentivizes additional employment in the manufacturing sector.
- Support to Employers: Offers financial support to employers for hiring additional employees.
Additionally, a new centrally sponsored skilling scheme aims to skill 20 lakh youth over five years, with upgraded Industrial Training Institutes (ITIs) and new courses aligned to industry needs.
Inclusive Human Resource Development
The budget adopts a saturation approach to ensure comprehensive development across all demographics, focusing on economic activities and empowerment of marginalized groups. The Purvodaya plan targets the holistic development of the eastern states, enhancing human resources, infrastructure, and economic opportunities.
Strengthening MSMEs and Manufacturing
MSMEs receive robust support through various initiatives, including a new credit guarantee scheme, revised Mudra loan limits, and enhanced scope for mandatory onboarding on the TReDS platform. The government also plans to open new SIDBI branches to expand direct credit to MSME clusters and set up multi-product food irradiation units and quality testing labs.
Significant Financial Allocations
- Agriculture and allied sectors: ₹1.52 lakh crore
- Education, employment, and skilling: ₹1.48 lakh crore
- Rural development including infrastructure: ₹2.66 lakh crore
- Schemes benefitting women and girls: More than ₹3 lakh crore
Conclusion
The 2024-2025 budget underscores the government’s commitment to inclusive growth and development. By focusing on employment, skilling, agriculture, and MSMEs, the budget aims to create a resilient economy that provides ample opportunities for all. As the government embarks on this ambitious journey, the initiatives and financial commitments outlined in this budget are set to pave the way for a prosperous and developed India.
Stay tuned as we continue to analyze and discuss the implications of this transformative budget for various sectors and demographics in the coming days.
1. What are the main themes of the 2024-2025 Budget?
The primary themes of the 2024-2025 Budget include employment, skilling, support for MSMEs (Micro, Small, and Medium Enterprises), and the middle class. The budget emphasizes inclusive growth, aiming to ensure progress for all Indians irrespective of religion, caste, gender, or age.
How does the budget address employment and skilling?
The budget introduces several schemes focused on employment-linked incentives, skilling programs, and support for higher education loans. Key initiatives include:
Three employment-linked incentive schemes for first-time employees, job creation in manufacturing, and support to employers for hiring additional workers.
A new centrally sponsored skilling scheme targeting the skilling of 20 lakh youth over five years, along with revised skill loan schemes.
What are the nine key priorities outlined in the budget?
The nine key priorities are:
Productivity and resilience in agriculture
Employment & skilling
Inclusive human resource development and social justice
Manufacturing & services
Urban development
Energy security
Infrastructure
Innovation, research & development
Next generation reforms
What measures are being taken to support agriculture?
The budget focuses on enhancing agricultural productivity and resilience by:
Releasing 109 new high-yielding and climate-resilient crop varieties.
Promoting natural farming among 1 crore farmers over the next two years.
Strengthening the production of pulses and oilseeds.
Developing vegetable production clusters.
Implementing Digital Public Infrastructure (DPI) for agriculture.
How will MSMEs benefit from the budget?
MSMEs will receive significant support through various measures, including:
A new credit guarantee scheme.
Revised credit assessment models.
Continued credit support during stress periods.
Enhanced Mudra loan limits.
Mandatory onboarding on the TReDS platform.
Expansion of SIDBI branches.
Financial support for food irradiation units and setting up e-commerce export hubs.
What are the financial allocations for key sectors in the budget?
Agriculture and allied sectors: ₹1.52 lakh crore
Education, employment, and skilling: ₹1.48 lakh crore
Rural development including infrastructure: ₹2.66 lakh crore
Schemes benefitting women and girls: More than ₹3 lakh crore
How does the budget aim to achieve energy security?
The budget outlines plans to ensure stable and sustainable energy supplies to meet the nation’s growing demands, although specific measures were not detailed in the speech.
What initiatives are included under urban development?
Urban development initiatives focus on sustainable infrastructure development, ensuring that urbanization efforts contribute to economic growth and improved living conditions.
What are the next generation reforms mentioned in the budget?
Next generation reforms aim to prepare the nation for future economic and social challenges through innovative policies and measures, although specific details were not provided in the speech.
What steps are being taken to enhance research and development?
The budget encourages innovation and research through funding and support for private sector involvement, promoting a culture of innovation across various sectors.
How will the budget impact the middle class?
The budget aims to support the middle class by creating job opportunities, enhancing skilling programs, and providing financial support for higher education, thereby improving their overall economic well-being.
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