Budget 2025 Important Points Explained Highlights: Union Finance Minister Nirmala Sitharaman unveiled her eighth consecutive Union Budget on Saturday (February 1). The income tax rebates she announced have been the biggest talking point.
Schemes for the MSME sector, women, farmers, the education sector, boosting exports, etc. have also been announced. The initiatives announced aim to boost self-reliance, with an eye on Atmanirbhar Bharat. Given the widespread discontent among the middle class, the announcement of tax relief has been welcomed. Here are five key takeaways from her speech.
Earlier, the Economic Survey was tabled in Parliament. It projected a growth rate of 6.3-6.8 per cent for the next financial year, stating, “Viksit Bharat@2047 envisions India as a developed nation by 2047, the centenary of our independence. This would entail sustained economic growth of close to 8 per cent every year for at least a decade.”
Scroll down for the Explained live blog, where our senior editors for Economy and Business provided updates from the Budget speech with a side-by-side explanation of the provisions and what they mean.
Finance Minister Nirmala Sitharaman has raised the limit of income tax rebate from Rs 7 lakh to Rs 12 lakh, which essentially means that if an individual has an income of up to Rs 12 lakh, she will have zero tax liability. We explain what it means for those earning above the limit.
Finance Minister Nirmala Sitharaman while presenting the Union Budget on Saturday (February 1) said that ‘nari’ (women) were one of four focus groups for the government.
Nari Shakti has long been a priority area for the Narendra Modi government, now in its third term. How do the Budget numbers reflect this focus? How does the Budget report on allocations for women and girls? Read here
Saturday’s Budget announcement of a massive income tax break is an acceptance by the government that more than anything else, the private sector investments require robust consumer demand.
Almost everything else — corporate income tax and interest rates and the condition of roads — is secondary. Read the big picture here
Bihar contributes to 90% of makhana production in India. But it has failed to thus far reap dividends from the surge in the “superfood’s” popularity. Can a ‘Makhana Board’ fix that? Read more here
Finance Minister Nirmala Sitharaman while presenting the Union Budget on Saturday (February 1) said that the ‘Make in India’ is one of the 10 broad areas of focus for the government in the coming year.
“In this Budget, the proposed development measures span ten broad areas focusing on Garib [the poor], Youth, Annadata [farmers], and Nari [women]… 6) Boosting manufacturing and furthering Make in India…,” the Finance Minister said.
Here are some specific announcements from the Budget speech pertaining to ‘Make in India’, and the government’s efforts to boost domestic manufacturing in the country. Read more here
In her budget speech, Finance Minister Nirmala Sitharaman announced the extension of the Jal Jeevan Mission till 2028, with an outlay of Rs 67,000 crore. This may be a step in the positive direction, as the country, with 18 per cent of the world’s population, contends with only 4 per cent of global freshwater resources. Read more here
Finance Minister Nirmala Sitharaman announced the National Mission for Edible Oilseeds to achieve atmanirbharta (self-reliance) in pulses
She said this will build on concerted efforts made 10 years ago. There has been a 50% increase in cultivated area.
Goal: Achieving self-reliance in Edible oilseeds
The mission will span six years and have a special focus on tur, urad, masur dal
Central agencies NAFED and NCCF will be ready to procure these pulses as much as possible over the next 4 years & enter into agreements with these agencies
The Budget announced the launch of a National Mission on High Yielding Seeds to be launched which will focus on
a) strengthening the research ecosystem,
b) targeted development and propagation of seeds with high yield, pest resistance & climate resilience
c) commercial availability of 100+ seed varieties released since July 2024
Shipbuilding Financial Assistance Policy: to be revamped to address cost disadvantages; will include Credit Notes for ship-wrecking in Indian yards to promote the circular economy
Infrastructure Harmonised Master List: will include large ships above a specified size
Shipbuilding clusters to increase the range, categories & capacity of ships. Additional infrastructure facilities, skilling and technology to develop the entire ecosystem
Maritime Development Fund to be set up with a corpus of Rs 25,000 cr. It will support the long-term financing of the maritime industry. Aims at distributing support and promoting competition. Upto 49% GoI support, rest by ports, private sector
Finance Minister Nirmala Sitharaman in her speech announced a plan to revamp India Post to become a large public logistics organisation.
Goal: To support Vishwakarmas, new entrepreneurs, women, self-help groups, MSMEs, and large business organisations
Current capacity: India Post has 1.5 lakh rural post offices, complemented by the India Post Payment Bank and 2.4 lakh Dak Sevaks.
Steps: Expanding the reach of India Post Payments Bank in rural areas. The expanded range of services will include:
1) Rural community hub colocation;
2) Institutional account services;
3) DBT, cash out and EMI pick-up;
4) Credit services to micro enterprises;
5) Insurance; and
6) Assisted digital services.
In the runup to the Budget, it had become clear that the Indian economy was losing its growth momentum. India’s GDP has grown at an average of less than 5% annually since 2019 and less than 6% since 2014. Udit Misra explains the five major takeaways from this year's budget. You can read more here
Aim: To provide relief to patients, especially those suffering from cancer, rare diseases and other severe chronic diseases
Exemption from Basic Customs Duty: 36 lifesaving drugs and medicines to the list of medicines fully exempted from Basic Customs Duty (BCD). Also, specified drugs and medicines under Patient Assistance Programmes run by pharmaceutical companies exempt, provided the medicines are supplied free of cost to patients. 37 more medicines proposed to be added along with 13 new patient assistance programmes.
5% Concessional Customs Duty: 6 lifesaving medicines to be added to this list.
Finance Minister Nirmala Sitharaman announced a slate of regulatory reforms. These include the following:
High-Level Committee for Regulatory Reforms: To be set up to review of all non-financial sector regulations, certifications, licenses, and permissions. Recommendations expected to be made within a year. The objective: To strengthen trust-based economic governance and take transformational measures to enhance ‘ease of doing business’, especially regarding inspections and compliances. States will be encouraged to join in this endeavour.
Investment Friendliness Index of States to be launched this year for competitive cooperative federalism
FSDC (Financial Stability and Development Council) Mechanism: To evaluate the impact of the current financial regulations and subsidiary instructions. Will provide a framework to enhance their responsiveness and development of the financial sector.
Jan Vishwas Bill 2.0: To decriminalise over 100 provisions in various laws. Over 180 legal provisions decriminalised so far under the Jan Vishwas Act 2023
What is the big picture emerging from the Union Budget presented by Finance Minister Nirmala Sitharaman on February 1? What was the context of this Budget — the twelfth Budget presented by the Narendra Modi government, and how has Sitharaman addressed it? Udit Misra explains here.
With a view on the assembly election in Bihar in November this year, Finance Minister Nirmala Sitharaman announced a slew of initiatives for the state.
Bihar is currently ruled by the Nitish Kumar-led Janata Dal (United) and the Bharatiya Janata Party (BJP). Out of the 243 Assembly seats, the BJP has 74, and JD(U) has 43. The main opposition party in Bihar—Rashtriya Janata Dal (RJD)—has 75 seats. You can read about the proposed schemes here.
Finance Minister Nirmala Sitharaman identified exports as a key engine for development over the coming year. To this end, she announced five initiatives:
Export Promotion Mission: This mission will be driven jointly by the Ministries of Commerce, MSME, and Finance. It aims to facilitate easy access to export credit, cross-border factoring support, and support to MSMEs to tackle non-tariff measures in overseas markets.
BharatTradeNet: A digital public infrastructure, ‘BharatTradeNet’ (BTN) for international trade will be set up as a unified platform for trade documentation and financing solutions. The BTN will complement the existing Unified Logistics Interface Platform, which allows industry players to access logistics-related datasets from various government systems.
Support for integration with Global Supply Chains.
National Framework for Global Capability Centres: As guidance to states for promoting Global Capability Centres (GCCs) in emerging tier 2 cities. GCCs offer support to MNCs. The proposed policy aims at enhancing availability of talent and infrastructure, building-byelaw reforms, and mechanisms for industry collaboration.
Warehousing facility for air cargo: To facilitate the upgradation of infrastructure and warehousing for air cargo including high-value perishable horticulture produce.
Finance Minister Nirmala Sitharaman announced the launch of the Nuclear Energy Mission with the goal of developing at least 100GW of nuclear energy by 2047.
This will involve active partnership with the private sector. To this end, amendments will be made to the Atomic Energy Act and the Civil Liability for Nuclear Damage Act.
Additionally, a nuclear energy Mission for R&D of small modular reactors has been announced with an outlay Rs 20,000 crores. At least 5 indigenously developed small modular reactors are to be operationalised by 2033.
The existing Special Window for Affordable, Mid-Income Housing (SWAMIH) scheme: Aims to help middle-class families who pay EMIs on loans taken for apartments, and rent on their current dwellings.
So far, 50,000 dwelling units in stressed housing projects have been completed and keys handed over. Another 40,000 units are to be completed in 2025.
SWAMIH Fund 2 announced today, will be established as a blended finance facility. This will include contributions from the Indian government, banks and private investors.
An outlay of Rs 15,000 crore is allotted for the expeditious completion of another 1 lakh units.
Finance Minister Nirmala Sitharaman has announced a significant hike in foreign direct investment (FDI) in the insurance sector, from 74 per cent to 100 per cent. This move is expected to attract global insurance giants and increase capital inflows. We explain the move
The finance minister has raised the limit of income tax rebate from Rs 7 lakh to Rs 12 lakh, which essentially means that if an individual has an income of up to Rs 12 lakh, she will have zero tax liability.
Does that mean that those earning Rs 15 lakh will have to pay tax on only Rs 3 lakh?
No, the rebate is only applicable for those earning up to Rs 12 lakh. If your taxable income is even a rupee more than Rs 12 lakh, you will have to pay taxes as per the slab rates under the new tax regime. Read the details here
UDAN regional connectivity schemes: Enabled 1.5 cr middle class people to enjoy speedier travel. Connected 88 ports & airports, operationalised 619 routes.
Building on this: modified UDAN scheme to be launched to connect 120 new destinations. 4 crore additional passengers in the next 10 years.
To support helipads, smaller airports in hilly, aspirational NE regional districts
Greenfield airports in Bihar: Also expansion of Patna Airport’s capacity; brownfield airport in Bihta
Despite income tax rate cuts, the Centre’s gross income tax receipts for 2025-26 is budgeted at Rs 14.38 lakh crore, which is 21.1% higher than the budget estimate of Rs 11.87 crore for 2024-25. Even for 2024-25, the revised estimate of gross income tax revenues at Rs 12.57 lakh crore is higher than the budgeted Rs 11.87 lakh crore.
While a lot of attention is on the income tax slabs, and we will keep bringing you more information on that, here are some other important budget announcements: Broadband connectivity to ALL govt secondary schools and PHCs in rural areas under BharatNet; Bharatiya Bhasha Pustak Scheme: digital form Indian language books for schools and higher education; Saksham Anganwadi & POSHAN 2.0 programme — Over 8 cr children supported, one crore pregnant women & lactating mothers countrywide; Daycare cancer centres in all district hospitals in next 3 years: 200 centres in FY25-26
Rs 0-4 lakh -- Nil
Rs 4-8 lakh -- 5%
Rs 8-12 lakh -- 10%
Rs 12-16 lakh -- 15%
Rs 16-20 lakh -- 20%
Rs 20-24 lakh: 25%
Above Rs 24 lakh -- 30%
Tax bonanza for the middle class: Finance Minister Nirmala Sitharaman said that the rebate on income tax under the New Tax Regime will be such that those with annual income of up to Rs 12 lakh will have zero income tax liability.
Union finance minister Nirmala Sitharaman on Saturday announced an allocation of Rs 20,000 crore to support private sector- driven research. She added that a deep-tech fund-of-funds is being explored to support next-generation of start-ups. The government has been facilitating research in the private sector even through its recently set-up funding body Anusandhan National Research Foundation.
Only 28% of the 50,000 funding budget of the body over five years will come from the government, with the rest coming from collaborations with private sector. The government has also setting up of start-ups, with the cabinet in October last year approving a R 1000 crore venture capital fund for space start-ups. To support tech research at top institutes such as IIT and IISc, the finance minister also announced 10,000 fellowships under the PM Research Fellowship scheme
FM says: Democracy, demography and demand crucial, appreciates role of middle class in national building. No income tax till income of Rs 12 lakh, she announces
IITs are set to get an infrastructure push. Sitharaman announced that additional infrastructure will be created in five IITs that were started after 2014 to facilitate education for 6500 more students. Hostel and other infrastructure at IIT Patna, which was set up in 2008, is also set to be expanded, she said. IIT Palakkad, Goa, Bhilai, Jammu, Dharwad and Tirupati were set up after 2014. Some of these third-generation IITs are still in the process of completing construction of parts of their campus.
Central institutions like IITs have also recently been taking loans provided by the Higher Education Financing Agency (HEFA) to improve their infrastructure.
Scheme to make India a global hub for toys. Development of clusters, skills, a manufacturing ecosystem that will create high quality, innovative, sustainable toys that will represent the Made in India brand
The fiscal deficit is pegged at 4.8% of GDP as per the revised estimate for 2024-25. It was estimated at 4.9% of GDP when Budget was presented in July 2024.
While total expenditure is lower at Rs 47.16 lakh crore for 2024-25 as per the Revised Estimates compared with Rs. 48.20 lakh crore in Budget Estimate, the capex for the year, as per RE is Rs 10.18 lakh crore, lower than Rs 11.11 lakh crore announced in July 2024.
Time to file tax returns extended from two years to four years, Sitharaman says.
