Key Announcements in Budget 2025-26
India’s Growth Vision for 2025-26: The Union Budget 2025, presented by Finance Minister Nirmala Sitharaman, outlines a comprehensive strategy aimed at economic stability, job creation, and structural reforms. With a strong focus on agriculture, small businesses, infrastructure development, and tax relief for the middle class, the budget seeks to accelerate India’s path towards becoming a developed nation under the vision of “Viksit Bharat.”
One of the most significant highlights of the budget is the announcement of zero income tax on income up to ₹12 lakh under the new tax regime, providing major relief to the middle class. Additionally, the government has proposed increased spending in key sectors such as education, healthcare, and rural development.
1. Tax Reforms and Middle-Class Relief
- No income tax up to ₹12 lakh under the new tax regime, marking a significant step in easing the financial burden on taxpayers.
- Revised tax slabs aim to make taxation simpler and fairer.
- Standard deduction limit increased from ₹50,000 to ₹75,000.
- TDS and TCS rationalization to simplify tax compliance.
- Tax rebate limit increased to ₹12 lakh, ensuring that individuals earning below this threshold pay zero tax.
- Senior citizens’ tax deduction limit doubled from ₹50,000 to ₹1 lakh.
- Rent TDS exemption increased from ₹2.4 lakh to ₹6 lakh annually.
- Extension of time limit for updated returns, allowing corrections up to four years instead of two.
2. Agriculture & Rural Development
- ₹5 lakh crore investment in agricultural infrastructure to boost farm productivity and rural employment.
- Prime Minister Dhan-Dhaanya Krishi Yojana introduced to develop 100 agri-districts, benefiting over 1.7 crore farmers.
- Aatmanirbharta in Pulses Initiative launched to ensure self-sufficiency in lentils with climate-resilient seed development.
- Cotton Productivity Mission announced to improve cotton yield and sustainability.
- Makhana Board in Bihar to promote processing, value addition, and organized marketing of makhana (fox nuts).
- Enhanced credit through Kisan Credit Card (KCC) for 7.7 crore farmers, fishermen, and dairy farmers.
3. MSME & Industrial Growth
- Credit cards for micro-enterprises launched with a ₹5 lakh limit for businesses registered on the Udyam portal.
- Revised MSME classification expands eligibility, allowing more enterprises to benefit from government schemes.
- ₹2 crore loans for first-time entrepreneurs, including 5 lakh women, SC, and ST entrepreneurs.
- Export-oriented MSME incentives, such as an increased credit guarantee cover.
- Ease of Doing Business Reforms including reduced compliance costs and relaxed business regulations.
4. Infrastructure and Urban Development
- ₹1 lakh crore Urban Challenge Fund to modernize Indian cities, enhance transportation, and improve water & sanitation.
- Expansion of greenfield airports in Bihar and other regions.
- Support for regional connectivity under the UDAN scheme to 120 new destinations.
- ₹15,000 crore SWAMIH Fund-2 for completing one lakh stalled housing units.
- Nuclear Energy Mission to encourage private sector participation in India’s nuclear power industry.
5. Employment, Education, and Healthcare
- 50,000 Atal Tinkering Labs to be established in government schools over the next five years.
- Expansion of IIT capacity to accommodate more students.
- ₹500 crore AI Education Center to focus on artificial intelligence in education.
- ₹20,000 crore investment in Research, Development & Innovation, particularly in private sector-driven projects.
- 10,000 additional medical seats in the next academic year, with a target of 75,000 seats over five years.
- Daycare cancer centers in all district hospitals to improve rural healthcare accessibility.
- Broadband connectivity for all government schools and rural health centers.
- PM Research Fellowship program launched to support 10,000 scholars in IITs and IISc.
6. Financial Sector & Investment Reforms
- Increased FDI cap in insurance from 74% to 100%.
- Partial Credit Enhancement Facility to boost corporate bond investments.
- Grameen Credit Score system introduced to support Self-Help Groups (SHGs) and small borrowers.
- Simplification of business mergers & regulatory framework to enhance investment attractiveness.
- Revamped Central KYC Registry to streamline banking and credit verification.
7. Customs, Trade & Export Promotion
- Rationalization of customs duty structure to reduce industry compliance costs.
- Exemption of import duty on key sectors, including LED TVs, textile machinery, lithium-ion batteries for EVs, and mobile manufacturing components.
- Export Promotion Mission launched to enhance global trade competitiveness.
- BharatTradeNet (BTN) digital platform introduced to facilitate seamless international trade.
- Warehousing for air cargo improved to support perishable exports.
8. Social Welfare and Women Empowerment
- MUDRA loans for homestays to encourage rural tourism.
- Expanded welfare for online platform workers, with benefits such as healthcare under PM Jan Arogya Yojana.
- Bharatiya Bhasha Pustak Scheme to digitize Indian language books for higher education.
9. Fiscal Deficit & Revenue Estimates
- Fiscal deficit projected at 4.4% of GDP, continuing fiscal consolidation efforts.
- ₹10 lakh crore Asset Monetization Plan introduced to generate capital for new infrastructure projects.
- Increased state support with ₹1.5 lakh crore 50-year interest-free loans for state development projects.
Key Takeaways from Union Budget 2025
- Biggest tax relief in recent years with zero income tax up to ₹12 lakh.
- Strong push for agriculture & rural economy with ₹5 lakh crore investment.
- Massive infrastructure spending, including urban redevelopment and airport expansion.
- Incentives for MSMEs & startups, with credit facilities and policy reforms.
- Boost for education and employment, particularly in AI, research, and healthcare.
- Increased trade facilitation, aiming for India to become a global export hub.
- Fiscal prudence maintained, with a targeted 4.4% fiscal deficit.
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