Union Budget 2024-25: Key Highlights

The Finance minister presented the first budget on 23rd July after the Shree Narendra Modi retained his position as the Prime Minister for the third consecutive term. During the budget, the Finance minister has outlined several key initiatives and allocations to address various economic sectors. In this article, we shall address the Union Budget 2024 Key Highlights.

Highlights of Union Budget 2024: Policies and Schemes under Different Sectors

Here are the important topics discussed by the Finance minister in the July 2024 Budget:

1. Agriculture Sector

• To promote natural farming 1 crore farmers across the country will be initiated into natural farming

• A provision of Rs.1.52 lakh crores has been provided for the agriculture and allied sectors.

• Introduction of 109 new high-yielding and 32 climate-resilient varieties fields and horticulture crops for cultivation by farmers.

• Establishment of 10,000 need-based bio-input resource centres for natural farming.

• Plans to finance for shrimp farming, processing and export arranged by NABARD.

• Implementation of Digital Public Infrastructure (DPI) for for coverage of farmers and their Agricultural lands in 3 years. Furthermore, Jan Samarth-based Kisan Credit Cards will be issued to farmers under the DPI.

2. Employment & Skilling

Employment Linked Incentive

As part of the Prime Minister’s package, 3 schemes for ‘Employment Linked Incentive’ to be implemented - 

• Scheme A - First Timers: Provision of one-month wage to new entrants in all formal sectors in 3 instalments up to ?15,000  which is expected to benefit 210 lakh youth in India

• Scheme B - Job Creation in manufacturing: Incentive for EPFO contributions to both employee & employer in the specified scales for the first 4 years expected to benefit 30 lakh youth

• Scheme C - Support to employers: Reimbursement of EPFO contributions by the Government to employers up to ?3000 per month for 2 years for all new hires which is expected to generate 50 lakh jobs.

Women Participation

The following initiatives will be looked in to facilitate higher women participation in the workforce:

• Establishment of working women hostels and crèches with industrial collaboration

• Organising women-specific skilling programmes

• Promotion of market access for women SHG enterprises

Skill Development

• Introduction of the new centrally sponsored scheme for Skilling under the Prime Minister’s Package for 20 lakh youth over a 5-year period.

• Facilitation of loans up to Rs.7.5 lakh under the Model Skill Loan Scheme.

• Financial support for loans upto Rs.10 lakh for higher education in domestic institutions shall be provided to youth who have not been eligible for any benefit under government schemes and policies.

3. Inclusive Human Resource Development and Social Justice

Purvodaya

• Plan for endowment rich states in the Eastern parts covering Bihar, Jharkhand, West Bengal, Odisha and Andhra Pradesh for the purpose of generating economic opportunities to attain Viksit Bharat

• Development of Industrial node at Gaya along the Amritsar-Kolkata Industrial Corridor.

• Power projects which includes the new 2400 MW power plant at Pirpainti, to be taken up at a cost of  Rs.21,400 crore.

Women-Led development

• A total allocation of more than Rs.3 lakh crore towards schemes benefitting women and girls.

Pradhan Mantri Janjatiya Unnat Gram Abhiyan

• Socio-economic development of tribal families in tribal-majority villages and aspirational districts which will cover 63,000 villages and benefit 5 crore tribal people.

Bank branches in North-Eastern Region

• Plans to set up 100 branches of India Post Payment Bank in the North East region.

Andhra Pradesh Reorganization Act

• Provision of Special financial support through multilateral development agencies of Rs.15,000 crore in the FY25.

• Completion of Polavaram Irrigation Project to ensure food security of the nation. 

• Essential infrastructure such as water, power, railways and roads in Kopparthy node on the Vishakhapatnam-Chennai Industrial Corridor and Orvakal node on Hyderabad-Bengaluru Industrial Corridor.

4. Manufacturing & Services

• Implementation of a credit guarantee scheme without collateral or third-party guarantee in term loans to MSMEs to facilitate the purchase of machinery and equipment.

• Implementation of a new mechanism which will facilitate continuation of bank credit to MSMEs during their stress period.

• Enhancement of the limit of Mudra loans under ‘Tarun’ category from Rs. 10 lakh to Rs.20 lakh for those who have successfully repaid previous loans.

• Reduction of the turnover threshold of buyers for mandatory onboarding on the TReDS platform from Rs.500 crore to Rs.250 crore..

• Financial support to set up 50 multi-product food irradiation units in the MSME sector .

• Setting up E-Commerce Export Hubs under the public-private-partnership (PPP) mode for MSMEs and traditional artisans to sell their products in international markets.

• Setting up Critical Mineral Mission for domestic production, recycling of critical minerals, and overseas acquisition of critical mineral assets.

• Auction of the first tranche of offshore blocks for mining, building on the exploration already carried out.

• Development of DPI applications in the areas of credit, education,  e-commerce, health, law and justice, logistics, MSME, services delivery, and urban governance.

5. Urban Development

• Formulation of Transit Oriented Development plans and strategies to implement and finance for 14 large cities above 30 lakh population.

• Investment of Rs. 10 lakh crore, including the central assistance of Rs. 2.2 lakh crore in next 5 years,  under PM Awas Yojana Urban 2.0 which address the housing needs of 1 crore urban poor and middle-class families.

• Implementation of a new scheme which will support the development of 100 weekly ‘haats’ or street food hubs every year for the next 5 years in select cities.

• Promotion of water supply, sewage treatment and solid waste management projects and services for 100 large cities through bankable project.

6. Energy Security

• Policy for promoting pumped storage projects for smooth integration of the growing share of renewable energy

• Government to partner with private sector in order for setting up & fo the R&D of Bharat Small Modular Reactor and newer technologies for nuclear energy, and to set up Bharat Small Reactors.

• A proposition of a Joint venture between NTPC and BHEL to set up a full scale 800 MW commercial plant using Advanced Ultra Super Critical (AUSC) technology.

• Providing financial support for shifting of micro and small industries to cleaner forms of energy and to facilitate investment grade energy audit in 60 clusters, which will be further extended expanded to 100 clusters in the next phase.

• Provision for 1 crore Households obtain free electricity upto 300 Units every month under the PM Surya Ghar Muft Bijli Yojana

7. Infrastructure

• Infrastructure investment of Rs. 11,11,111 crore (3.4 % of GDP) for capital expenditure to be provided by Central Government 

• Loan of Rs. 1.5 lakh crores shall be provided for long-term interest free loans to support states in infrastructure investment.

• Implementation of of phase IV of PMGSY to provide all-weather connectivity to 25,000 rural habitations.

Irrigation and Flood Mitigation

• Provision of Financial support of Rs. 11,500 crore to projects such as the Kosi-Mechi intra-state link and 20 other schemes in Bihar.

• Government to provide assistance to Assam, Uttarakhand, Himachal Pradesh, and Sikkim for floods, landslides and other related projects.

 Tourism

• Comprehensive development of Mahabodhi Temple Corridor, Vishnupad Temple Corridor, and Rajgir.

• Assistance for development of temples, monuments, craftsmanship, wildlife sanctuaries, natural landscapes and pristine beaches of Odisha.

• The development of Nalanda as a tourist centre apart from reviving Nalanda University to its glorious stature. 

8. Innovation, Research & Development

• Anusandhan National Research Fund for the purpose of basic research and prototype development to be operationalised.

• Financing pool of Rs. 1 lakh crore for driving private sector-driven research and innovation at commercial scale.

• Venture capital fund of Rs.1,000 crore to be set up for the expansion of the space economy by 5 times in the next 10 years.

9. Next Generation Reforms

• Rural Land Related Actions

• Unique Land Parcel Identification Number (ULPIN) or Bhu-Aadhaar for all lands

• Digitization of cadastral maps

• Survey of map sub-divisions as per current ownership

• Establishment of land registry

• Linking to the farmers registry

• Digitization of Land records in urban areas with GIS mapping.

• Integration of e-shram portal with other portals to facilitate one-stop solutions.

• Open architecture databases for the rapid changing labour market, skill requirements and available job roles.

• FDI and Overseas Investments to be simplified to facilitate and promote opportunities for using Indian Rupee as a currency for overseas investments.

• NPS-Vatsalya as a plan for contribution by the parents and guardians for minors.

Check out our news section to learn more about the sector wise budget allocation and policy announcements under Viksit Bharat.

Union Budget 2024 Highlights: Tax Proposals

1. Indirect Tax Proposals

GST: Encouraged by the triumph of GST, efforts will be made to simplify and rationalize the tax structure to extend GST to the remaining sectors.

Sector-specific customs duty proposals

2. Direct Tax Proposals

To reduce the compliance burden, promote entrepreneurial spirit and provide tax relief to citizens

Rationalisation of capital gains

• Short-term gains of financial assets increased to a 20% tax rate 

• Long-term gains on all financial and non-financial assets increased to a tax rate of 12.5%

• Increase in limit of exemption of capital gains on financial assets to ?1.25 lakh per year.
  

Employment and Investment

• Abolition of ANGEL tax for all classes of investors. 

• Simpler tax regime to operate domestic cruise 

• Provide safe harbour rates for foreign mining companies (Selling raw diamonds)

• The corporate tax rate on foreign companies reduced from 40% to 35%.

Key Tax Regime Revisions

Check out the latest news to learn more about the new income tax proposal in budget 2024-25

Note: It should be noted that the the old tax regime which is eligible for deductions under section 80 has remained unchanged

Conclusion

The government has announced a comprehensive union budget for India to address the imminent need for employment generation, skill development, and new initiatives in agriculture, MSMEs, infrastructure, and other priority sectors. Visit our social channels for more budget updates!