Union Budget 2025: Charting a Course for Growth and Inclusivity

The Union Budget 2025, presented by Finance Minister Nirmala Sitharaman on February 1st, 2025, at 11 a.m., outlines India’s strategic direction for economic growth, fiscal stability, and social progress. This budget emphasizes focusing on stimulating economic growth, enhancing middle-class spending power, promoting inclusive development and enhancing India’s global competitiveness. 

Key Highlights of Budget 2025 for PGDM students.

1. Infrastructure: Building the Foundation for Growth

Infrastructure development receives a significant boost, with increased funding allocated to critical projects to fuel long-term growth and improve connectivity. Key initiatives include:  

• Rural Infrastructure Enhancement: Increased investment in rural roads, sanitation, and water management to bridge the rural-urban gap.  

• National Infrastructure Pipeline (NIP) Expansion: The NIP will expand to encompass sectors like electric mobility and green energy, promoting sustainable development.  

• Smart Cities and Urban Development: Increased funding for urban modernization, including technology integration, smart utilities, and enhanced public transportation. 
  

2. Digital India: Innovation and Technological Advancement

The digital economy remains a priority, with the budget focusing on:

• Startup and Innovation Incentives: Tax breaks, grants, and streamlined regulations to support homegrown startups in AI, biotech, and other emerging sectors.  

• Cybersecurity Reinforcement: Increased spending on cybersecurity infrastructure to protect sensitive data and digital assets. 

• Digital Literacy Expansion: Investment in nationwide digital literacy programs to equip citizens for the digital economy. 

3. Taxation: Simplifying the System

Tax reforms aim to simplify compliance for individuals and businesses: 

• Individual Tax Simplification: Restructured tax slabs, with a larger proportion of taxpayers benefiting from the 10% tax slab.
• Increased Tax Exemption Limit: The non-taxable personal income threshold has been raised from ₹6 lakh to ₹12 lakh per annum, aiming to boost savings and consumption among the middle class.
• Revised Tax Slabs: Tax brackets have been adjusted, with the maximum rate of 30% now applicable to incomes above ₹24 lakh, reducing the tax burden on middle-income groups.
• Green Investment Tax Incentives: Tax deductions for individuals and businesses investing in green technologies, renewable energy, and EVs. 

• Business Tax Streamlining: Tax credits for small businesses and startups, along with a review of corporate tax rates to attract investment. 

4. Health and Education: Investing in Human Capital

The budget prioritizes a healthy and educated populace with:

• National Health Mission Expansion: Focus on preventive care, digital health, and improved access to healthcare in underserved areas.   

• Skill Development Funding: Increased investment in vocational training and reskilling initiatives, particularly in high-growth sectors. 

5. Agriculture: Empowering Farmers and Promoting Sustainability 

The agricultural sector receives attention with:

• Direct Income Support: Increased direct cash transfers to farmers under the PM-Kisan Yojana. 
  
• Sustainable Agriculture Promotion: Incentives for farmers adopting water-saving technologies, organic farming, and other eco-friendly practices. 

   

6. Green Growth: A Sustainable Future

Sustainability is a central theme, with initiatives focused on:

• Clean Energy Investment: Significant funding for renewable energy projects, including solar, wind, and green hydrogen.  
  
• Carbon Reduction Targets: Reaffirmation of the net-zero emissions commitment by 2070, with strategies to reduce carbon intensity in key industries. 
  

7. Social Welfare: Supporting Vulnerable Communities

Social welfare programs are strengthened with:

• Women and Child Welfare Allocations: Dedicated funds for programs promoting gender equality, women’s health, and financial empowerment.
  
• Financial Inclusion Initiatives: Focus on expanding access to credit and banking services for rural and underserved populations.  

   

8. MSME Sector: Fostering Growth and Entrepreneurship

• Easy Access to Credit: Schemes to facilitate affordable loans and reduced interest rates. 

• Credit Guarantee Scheme Extension: Continued support through the CGTMSE to provide collateral-free loans. 

   

9. Foreign Investment and Trade: Enhancing Global Engagement

The budget aims to attract foreign investment and promote trade with:

• FDI Attraction: Measures to simplify business setup for foreign investors, including regulatory relaxation and incentives. 

• Free Trade Agreements (FTAs): Efforts to strengthen trade relations with key global partners. 

A Balanced Approach to Development

The Union Budget 2025 presents a comprehensive vision for India’s future, balancing economic growth with inclusivity and sustainability. It addresses key areas from infrastructure and technology to social welfare and environmental concerns. This budget aims to steer India towards a stronger, more resilient economy and solidify its position on the global stage.