Union Budget 2025-26 Act by Sushil Financial Services Ltd
UNION BUDGET 2025 : EXECUTIVE SUMMARY
Budget 2025: The Balancing Act
The Finance Minister, Ms. Sitharaman presented her 8th consecutive Budget and the first Women to do so, creating history.
The Union Budget 2025 was presented amidst global uncertainties on trade and tariffs, slowdown in economic growth and large geopolitical uncertainty. Given the above limitations the Finance Minister did a good job of spurring demand through incentives on the direct tax front.
The Union Budget 2025 continued its path of fiscal consolidation thereby targeting the fiscal deficit for FY 2025-26 at 4.40% and also guided a roadmap for next six years to reach the stated fiscal deficit target.
The key focus areas for the government in this Budget have been to a) Accelerate growth b) Secure inclusive development c) Invigorate private sector investment d) Uplift household sentiments and e) Enhance spending power of India’s rising middle class.
To achieve the destination of ‘Viksit Bharat’, the Budget has put a roadmap of a journey using four powerful engines 1) Agriculture 2) MSME 3) Investments 4) Export, using fuel of reforms and spirit of inclusivity.
This Budget also aims to initiate transformative reforms across six domains for next five years. They are a) Taxation 2) Power sector 3) Urban development 4) Mining 5) Financial sector 6) Regulatory Reforms.
To sum up Budget 2025 focus on unleashing India’s power in manufacturing and consumption through various action plans laid out, the focus on inclusive development, rewarding the honest tax paying citizen, simplifying rules and regulations, pushing ease of doing business and focusing on macro stability through fiscal consolidation.
ENGINE 1 : AGRICULTURE
Budget has come up with steps to enhance employment, production in agriculture and facilitate credit to the farmers.
* Prime Minister Dhan-Dhaanya Krishi Yojana The programme will cover 100 districts to (1) enhance agricultural productivity, (2) adopt crop diversification and sustainable agriculture practices, (3) augment post-harvest storage at the panchayat and block level, (4) improve irrigation facilities, and (5) facilitate availability of longterm and short-term credit.
* Building Rural Prosperity and Resilience With tie up with the states, a program to address under-employment in agriculture through skilling, investment, technology will be launched. It will focus on rural women, young farmers, rural youth, marginal and small farmers, and landless families.
* Aatmanirbharta in Pulses and Program for Vegetables and Fruits Government will now launch a 6-year “Mission for Aatmanirbharat in Pulses” with a special focus on Tur, Urad and Masoor. The emphasis is to enhance protein content, improve post harvest storage and management. Apart from this, a program to promote production, efficient supplies, processing and remunerative prices for farmers will be launched in partnership with the states.
* Makhana Board in Bihar The Board will provide handholding and training support to makhana farmers and will also work to ensure they receive the benefits of all relevant Government schemes.
* Fisheries Seafood exports are valued at Rs. 60,000 cr. and to increase the market further, Government will focus on to harness fisheries from Indian Exclusive Economic Zone and High Seas, with a special focus on the Andaman & Nicobar and Lakshadweep Islands.
* Mission for Cotton Productivity A 5 year mission should lead to improvements in productivity and sustainability of cotton farming. The best of science & technology support will be provided to farmers. This would help in a steady supply of quality cotton for rejuvenating India’s traditional textile sector.
ENGINE 2 : MSME
* Revision in classification criteria for MSMEs and increase of credit availability with guarantee cover MSME will be facilitated to achieve higher efficiencies of scale and technological upgradation by increasing the investment and turnover limits to 2.5x and 2x respectively. The credit guarantee cover will be enhanced: a) For Micro and Small Enterprises, from Rs.5 cr. to Rs.10 cr., leading to additional credit of Rs.1.5 lakh cr. in the next 5 years; b) For Startups, from Rs.10 cr. to Rs.20 cr., with the guarantee fee being moderated to 1% for loans.
* Focus Product Scheme for Footwear & Leather Sectors This scheme will support design capacity, component manufacturing, and machinery required for production of non-leather quality footwear, besides the support for leather footwear and products.
* National Manufacturing Mission Government will provide policy support, execution roadmaps and monitoring framework for central ministries to set up a manufacturing mission that will include small, medium and large industries. The Mission’s mandate will include 5 focus areas:
* ease and cost of doing business;
* future ready workforce for in-demand jobs;
* a vibrant and dynamic MSME sector;
* availability of technology; and
* quality products.
* Clean Tech Manufacturing The mission will support clean tech manufacturing to improve domestic value addition and build our ecosystem for solar PV cells, EV batteries, motors and controllers, electrolyzers, wind turbines, very high voltage transmission equipment and grid scale batteries.
* Toy Sector Government aims to make India a global hub for toys. The scheme will focus on development of clusters, skills, and a manufacturing ecosystem that will create high-quality, unique, innovative, and sustainable toys that will represent the 'Made in India' brand.
ENGINE 3 : INVESTMENT
The Central Government encompasses investing in people, investing in the economy and investing in innovation. 1. Investing in People:
* Saksham Anganwadi and Poshan 2.0: The Scheme provides nutritional support for 8 cr. children, 1 cr. pregnant/lactating women, and 20 lakh adolescent girls in aspirational districts and the north-east region.
* Atal Tinkering Labs: Establishing 50,000 labs in government schools to promote scientific innovation.
* Broadband Connectivity: Internet access in all government secondary schools and primary health centers via Bharatnet.
* National Centres of Excellence for Skilling: Five National centers for equipping youth with global-standard skills for Excellence for skilling and equip the youths with skills required
for “Make for India, Make for the World” manufacturing.
* Expansion of IIT Capacity: Additional Infrastructure will be created in the 5 IITs started after 2014 to facilitate additional 6,500 more students. Hostel and other infrastructure capacity at IIT, Patna will also be expanded.
* Centre of Excellence in AI for Education: Rs.500 cr. allocated to advance AI applications in education.
* Medical Education Expansion: 10,000 additional UG and PG medical seats in the next year with a goal of adding 75,000 seats in the next 5 years.
* Day Care Cancer Centres: 200 centers to be established in all district hospitals by 2025-26. ? Urban Livelihood Strengthening: A scheme for socio-economic upliftment scheme for urban workers will help them improve their incomes, have sustainable livelihoods and a better quality of life.
* PM SVANidhi: The scheme will be revamped with enhanced loans from banks, to provide enhanced loans and UPI-linked Rs.30,000 credit cards for street vendors.
* Social Security for Gig Workers: Identity registration and healthcare coverage for 1 cr. platform-based workers.
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