Finance minister Nirmala Sitharaman presented the interim budget today, ahead of the Lok Sabha elections, purportedly with a renewed emphasis on welfare schemes for four groups – “the poor, women, youth and farmers”. 

Sitharaman kicked off the budget speech by recounting the economic achievements of the Modi government. She also said the government was working to make India a developed nation by 2047. The finance minister said there would be no changes in tax rates for direct and indirect taxes, including import duties, and the estimate for fiscal deficit for FY2025 has been tapered to 5.1 percent of the GDP against 5.8 percent in FY2024.

The key announcements included increased spending on infrastructure and increased social security cover. She also announced a new scheme for investment in deeptech for the defence sector, and a push to encourage domestic tourism. 

Let’s take a detailed look.

Infrastructure: The finance minister said the Modi government will increase the infrastructure outlay to Rs 11.11 lakh crore in FY25. It will construct three major corridors for energy, mineral and cement under the PM Gati Shakti and enable one crore households to attain 300 units of free electricity every month, said Sitharaman. 

Welfare: The FM said the central government will build two crore affordable houses in the next five years under the Pradhan Mantri Awas Yojana (Gramin). She said that crop insurance scheme benefits will reach 40 million farmers, and added that 25 crore people have broken out of poverty in the last 10 years. 

Women: In a big announcement, the FM said ASHA and Anganwadi workers will now be covered under the Ayushmann Bharat scheme. She highlighted that about one crore women had become “lakhpatis” or are earning in lakhs with the success of self-help groups.  

Sitharaman also said that female enrolment in STEM courses has increased by 28 percent in the last decade, and women’s participation in the workforce has risen.

Tech and India Inc: Sitharaman announced that a corpus of Rs 1 lakh crore will be established with a 50-year interest free loan to encourage companies to scale up research and innovation. She said to “meet investment needs”, the government will prepare the financial sector in terms of size, capacity, skills, and regulatory framework.

The tax benefits for startups and investments made by sovereign wealth and pension funds will be extended till March 2025, said the FM, adding that tax reforms had led to the deepening and widening of the tax base. She did not announce any changes to the tax regime. To increase acceptance for the new income tax regime, the government may allow deductions under 80C.

In addition, Sitharaman said the government will launch a new scheme to strengthen the employment of deeptech in the defence sector.

The FM said the government will increase investment in tourism, and Lakshadweep will get an “undivided attention” to improve its tourist infrastructure.

Farmers: Sitharaman said the government will step up efforts to increase farmers’ income and that the minimum support prices will also be raised periodically. She said the government will support dairy farmers in hiking milk production and combating cattle diseases.    

The government will also launch a strategy for Atma Nirbharta or self-reliance in oilseeds production. It will focus on research for high-yielding varieties, procurement, value addition, and crop insurance. 

Sitharaman said the use of nano diammonium phosphate or DAP fertilisers will be expanded for all agro-climatic zones. 

In addition, the finance minister said the PM Matsya Sampada scheme will be boosted to generate 55 lakh jobs and increase exports to Rs 1 lakh crore.

This report was published with AI assistance.