Finance Minister Nirmala Sitharaman presented the interim budget for the fiscal year 2024 on February 1, unveiling a comprehensive roadmap aimed at steering India's economic course in the coming months. This article delves into the critical highlights and takeaways, offering insights into the government's fiscal priorities.
Taxation-: No changes were announced in direct and indirect tax rates, ensuring stability for businesses and taxpayers. Notably, the budget revealed a commitment to environmental sustainability with a lower tax on hybrid cars, aligning with global efforts to encourage eco-friendly practices.
Fiscal Management-: The fiscal deficit target for FY25 was set at 5.1% of GDP, indicating a substantial reduction from the 6.8% recorded in FY24. This move underscores the government's commitment to fiscal prudence and financial stability.
Infrastructure and Growth-: Capital expenditure received a significant boost of 20%, reflecting the government's determination to stimulate infrastructure development and overall economic growth. This investment signals a focus on establishing a robust foundation for sustainable development.
Housing and Socioeconomic Development-: A novel housing loan subsidy scheme was introduced to provide low-cost loans to low and middle-income groups, promoting affordable housing and homeownership. Additionally, a 15% increase in the allocation for agriculture and rural development emphasizes the commitment to supporting farmers and bolstering the rural economy.
Health and Education-: With a 10% increase in funding, the budget emphasizes the importance of health, particularly in the context of COVID-19 vaccination efforts. The allocation for education also received an 8% boost, underlining the government's dedication to digital learning initiatives and the need for a well-educated workforce in the digital age.
Defence-: Allocations for defense increased by 7%, with a focus on enhancing national security and modernizing the armed forces. This commitment highlights the government's resolve to maintain a robust defense infrastructure.
Divestment and Privatization-: The divestment target was reduced from Rs 1.75 lakh crore to Rs 1.25 lakh crore. As part of this strategy, the government plans to privatize two public sector banks and one general insurance company, indicating a measured approach to streamline and optimize public assets.
Vision 2047-: Perhaps the most visionary aspect of the budget is the announcement of a roadmap for Vision 2047. This initiative outlines a long-term plan to achieve economic and social goals by the 100th year of India's independence. It symbolizes the government's commitment to sustained growth and prosperity for the nation.
- No change in direct and indirect tax rates, including import tax
- The tax break for start-ups extended to March 31, 2025
- Govt to withdraw old disputed direct tax demands of up to Rs 25,000 till FY2009 and Rs 10,000 for 2010-11 to 2014-15
- Capital expenditure increased by 11% to Rs 11.1 lakh crore for FY25
- Fiscal deficit target lowered to 5.1% for FY24 and 4.5% for FY26
- The divestment target was reduced to Rs 30,000 crore for FY24 and Rs 50,000 crore for FY25
- A roadmap for a long-term plan linked to Vision 2047, which aims to achieve a $10 trillion economy by 2030 and a $30 trillion economy by 2047
