Highlights of budget 2025: Finance Minister Nirmara Citaraman presented the second budget of the BJP government led by Prime Minister Narendra Modi on Saturday.
Until the budget, it became clear that the Indian economy has lost its growth. Indian GDP has grown less than 5 % a year since 2019 and less than 6 % since 2014.
This is five important points from the union budget of the next fiscal year (2025-26).
01
Large -scale income tax reduction, more money for taxpayers
The dissatisfaction has boiled down the taxation of the middle class too much. Therefore, many people were hoping for some kind of tax reduction on the budget.
However, FM surprised everyone by announcing a large -scale income tax easing by raising the tax rebate level to an annual income of 120,000. This level has been 7 rupees so far.
She also fine -tuned the tax slabs so that the highest tax rate (30 %) in Japan was 240,000 a year and 2 rupees per month.
Of course, this rescue is limited to taxpayers. It leaves more money in their pockets. The government hopes that additional money will be spent, and it hopes to start a growth process. This will eventually start investing in new abilities and create new employment and income.
02
The discipline of the finances has been maintained and the deficit is decreasing due to lack.
We are afraid that if the government pays or provide excessive tax rescue, we will force you to borrow more money.
As the government borrows more, the amount of money borrowed by private citizens and companies is reduced, which raises the interest rate of all people. Or, they are forced to print money -and that leads to inflation. This works like a tax to reduce the purchasing power of people.
However, despite the large -scale tax reduction of about one rupee of about one rupee for the government, the government’s budget deficit (or the borrowed money level) was 4.4 % in 2025 (GDP). -26, the Minister of Finance said.
03
Growth stalls for capital spending, signal shift from recent budgets
Growth of capital spending: The big story from the second budget of the Narendra Modi government (2019-24) focused on increasing capital spending.
Capital spending is basically a spending on the creation of productive assets such as roads, ports and bridges.
The government not only missed the capital expenditure target for the current fiscal year to almost one rupee, but the capital investment registered next year is less than 10,000 rupees this year.
That being said, Capex allocation is still high depending on historical standards.
04
Focus on visible employment generation to increase specific sector
Another big turnaround is focusing.
For some time, the government has been criticized for ignoring the aspect of employment of policy measures. For example, the production linked incentive (PLI) scheme was essentially a subsidy for companies and ventures that were heavy for the use of capital instead of workers.
This budget is focused on employment generation, which is displayed in the form of measures announced to boost economic activity in sectaries such as textiles and leather that generate more employment by GDP at the same level.
05
Promote regulatory reform
FM has announced the establishment of a committee to investigate the regulatory reforms needed to make it easier for companies and entrepreneurs to do business in India.
This is a welcome step, but it is late. It has been 11 years since the Modi government first gained power.
This is a welcome step, but it is late. It has been 11 years since the Modi government first gained power.
© The Indian Express PVT LTD
Enlarge
