Union Finance Minister Nirmala Sitharaman presented the Union Budget 2024-25 on July 23, outlining significant measures aimed at sustaining economic growth, enhancing infrastructure, and improving social welfare programs. This budget marks Sitharaman’s seventh presentation and the first full budget of the BJP-led NDA government following the Lok Sabha elections.
The Union Budget 2024-25, presented by Finance Minister Nirmala Sitharaman, sets the stage for India’s economic trajectory over the next fiscal year. It addresses critical areas such as economic growth, consumer goods affordability, infrastructure development, and social welfare. This budget arrives amidst a backdrop of robust economic recovery post-pandemic and aims to leverage this momentum to propel further growth.
The Economic Survey 2024, preceding the budget, projected a GDP growth rate of 6.5-7% for the fiscal year 2024-25. The survey highlighted a significant recovery from the COVID-19 pandemic, with the real GDP for 2023-24 standing 20% higher than pre-pandemic levels. Additionally, retail inflation declined to 5.4% from 6.7% in the previous fiscal year, signaling a stabilization of the economy.
A major highlight of the budget is the anticipated reduction in prices of consumer goods, particularly mobile phones and compressed natural gas. Sitharaman continued previous efforts to boost domestic manufacturing by reducing import taxes on essential components such as camera lenses and lithium-ion batteries, which are crucial for the electronics and electric vehicle industries.
The budget allocates substantial funds for social welfare programs. The PM Awas Yojana Urban 2.0 has been allocated Rs 10 lakh crore to enhance urban housing infrastructure, with central assistance of Rs 2.2 lakh crore over the next five years. Additionally, a new credit guarantee scheme for MSMEs aims to mitigate credit risks and facilitate easier access to term loans. Each applicant under this scheme can receive coverage up to Rs 100 crore, promoting entrepreneurship and business expansion.
Infrastructure development is a cornerstone of the Union Budget 2024-25. The budget includes a Rs 26,000 crore allocation for road connectivity projects, particularly in Bihar, where new highways and expressways are planned. The Amritsar-Kolkata industrial corridor will see the establishment of an industrial hub in Gaya, Bihar, boosting regional development. These projects are expected to enhance connectivity, reduce travel time, and support economic activities in the region.
Sitharaman emphasized fiscal discipline with a target to reduce the fiscal deficit to 5.1% of GDP for 2024-25, down from over 9% in 2020-21. This is supported by a substantial Rs 2.11 lakh crore dividend from the Reserve Bank of India and buoyant tax revenues. The government’s prudent fiscal management aims to balance growth-oriented spending with maintaining macroeconomic stability.
The Union Budget 2024-25, presented by Finance Minister Nirmala Sitharaman, lays out a comprehensive plan to sustain India’s economic growth, improve infrastructure, and enhance social welfare. With significant allocations for consumer goods affordability, infrastructure projects, and social welfare programs, the budget aims to build on the economic recovery post-pandemic and set the stage for continued growth. The emphasis on fiscal discipline ensures that these initiatives are balanced with sustainable economic management, positioning India for a robust and resilient economic future.
