PART-A

• Budget theme: The Union Budget 2024–25 is focused on employment, skilling, MSMEs, and the middle class. Prime Minister’s package of 5 schemes and initiatives to facilitate employment, skilling and other opportunities for 4.1 crore youth over a 5-year period with a central outlay of Rs. 2 lakh crore (US$ 23.94 billion). Provision of Rs. 1.48 lakh crore (US$ 17.72 billion) for education, employment and skilling.
• Budget priorities: In pursuit of ‘Viksit Bharat’ and the strategy set out in the interim budget, this budget includes the following 9 priorities for generating ample opportunities for all:
  • Productivity and Resilience in Agriculture
  • Employment & Skilling
  • Inclusive Human Resource Development and Social Justice
  • Manufacturing & Services
  • Urban Development
  • Energy Security
  • Infrastructure
  • Innovation, Research & Development
  • Next-generation Reforms

  Priority 1: Productivity and Resilience in Agriculture

  • Transforming agriculture research:The government will undertake a comprehensive review of the agriculture research setup to bring the focus on raising productivity and developing climate-resilient varieties. Funding will be provided in a challenge mode, including to the private sector. Domain experts both from the government and outside will oversee the conduct of such research.
  • Release of new varieties: New 109 high-yielding and climate-resilient varieties of 32 field and horticulture crops will be released for cultivation by farmers.
  • Natural farming: In the next two years, 1 crore farmers across the country will be initiated into natural farming supported by certification and branding. Implementation will be through scientific institutions and willing gram panchayats. A total of 10,000 need-based bio-input resource centres will be established.
  • Missions for pulses and oilseeds: A strategy is being put in place to achieve ‘atmanirbharta’ in oil seeds such as mustard, groundnut, sesame, soybean and sunflower.
  • Shrimp production & export:Financing for shrimp farming, processing and export will be facilitated through NABARD.
  • Vegetable production and supply chains: Large-scale clusters for vegetable production will be developed closer to major consumption centres. Promotion of farmer-producer organisations, cooperatives and start-ups for vegetable supply chains including for collection, storage and marketing will be encouraged.
  • Digital public infrastructure (DPI) for agriculture: The government, along with states, plans to implement DPI in agriculture within 3 years, starting with digital crop surveys in 400 districts this year for kharif. The initiative aims to register the details of 6 crore farmers and their lands and enable the issuance of Jan Samarth based Kisan Credit Cards in 5 states.
  • Budgetary allocation:There has been a provision of Rs. 1.52 lakh crore (US$ 18.20 billion) for the agriculture and allied sector.

  Priority 2: Employment & Skilling

  • Employment Linked Incentive:The government will introduce three schemes under the Prime Minister's package for 'Employment Linked Incentive' based on EPFO enrolment.
    • Scheme A (First-Timers): One-month salary will be provided to new employees in formal sectors up to Rs. 15,000 (US$ 179.22) in 3 instalments for those earning up to Rs. 1 lakh per month (US$ 1,194.82), benefiting 210 lakh youth.
    • Scheme B (Job Creation in manufacturing): Focuses on job creation in manufacturing by incentivising additional employment for first-time employees and their employers, with respect to their EPFO contributions in the first 4 years, benefitting 30 lakh youth.
    • Scheme C (support to employers): Supports employers by reimbursing up to Rs. 3,000 (US$ 35.84) per month for 2 years towards EPFO contributions for each additional employee within a salary of Rs. 1 lakh (US$ 1,194.82) per month, aiming to incentivise employment of 50 lakh individuals.
  • Participation of women in the workforce:Facilitate a higher participation of women in the workforce by setting up working women hostels in collaboration with the industry and establishing creches, in addition to organising women-specific skilling programmes and promotion of market access for women SHG enterprises.
  • Skilling programme: A new scheme under the Prime Minister's package will skill 20 lakh youth over 5 years by upgrading 1,000 Industrial Training Institutes in collaboration with states and the industry. Courses will align with the industry needs by introducing new programmes for emerging skills.
  • Skilling loans: The Model Skill Loan Scheme will be revised to facilitate loans up to Rs. 7.5 lakh (US$ 8,961) with a guarantee from a government promoted fund, helping 25,000 students every year.
  • Education loans: Financial support announced for youth ineligible for government schemes, such as loans up to Rs. 10 lakh (US$ 11,948.21) for higher education in domestic institutions and E-vouchers providing an annual interest subvention of 3% on the loan amount for 1 lakh students yearly.

  Priority 3: Inclusive Human Resource Development and Social Justice

  • Saturation approach: The government is dedicated to holistic development, focusing on farmers, youth, women and the underprivileged. A saturation approach will be used to cover all eligible individuals through various programmes for education and health to enhance their capabilities. The implementation of schemes supporting economic activities will be intensified.
  • Purvodaya: A plan named “Purvodaya” will be developed for the holistic growth of Bihar, Jharkhand, West Bengal, Odisha and Andhra Pradesh in the eastern region. This initiative aims to boost human resources, infrastructure and economic opportunities. It includes support for an industrial node at Gaya along the Amritsar–Kolkata Industrial Corridor, showcasing the “Vikas bhi Virasat bhi” in the growth trajectory. Road projects costing Rs. 26,000 crore (US$ 3.11 billion) like the Patna–Purnea Expressway will be initiated, along with a new 2,400 MW power plant at Pirpainti costing Rs. 21,400 crore (US$ 2.56 billion). Additionally, developments in airports, medical colleges and sports infrastructure in Bihar are planned, with increased capital investments and expedited external funding requests from multilateral development banks.
  • Andhra Pradesh Reorganization Act: The government is committed to fulfilling the commitments under the Andhra Pradesh Reorganization Act. Special financial support through multilateral development agencies will be facilitated for the state's capital needs, with Rs. 15,000 crore (US$ 1.80 billion) arranged in the current financial year and additional amounts in the future. Funding for the Polavaram Irrigation Project, crucial for Andhra Pradesh's farmers and national food security, will be ensured for early completion. Industrial development in the Kopparthy and Orvakal nodes will receive funds for essential infrastructure like water, power, railways and roads on key industrial corridors. Additional capital investment will be allocated this year for economic growth, along with grants for the backward regions of Rayalaseema, Prakasam and North Coastal Andhra, as mandated in the Act.
  • PM Awas Yojana: Three crore additional houses under the PM Awas Yojana in rural and urban areas in the country have been announced, for which the necessary allocations are being made.
  • Women-led development: For promoting women-led development, the budget carries an allocation of more than Rs. 3 lakh crore (US$ 35.92 billion) for schemes benefitting women and girls, signalling the government’s commitment for enhancing women’s role in economic development.
  • Pradhan Mantri Janjatiya Unnat Gram Abhiyan: Launch of the Pradhan Mantri Janjatiya Unnat Gram Abhiyan, adopting saturation coverage for tribal families in tribal-majority villages and aspirational districts across 63,000 villages benefitting 5 crore tribal people.
  • Bank branches in the North-East region: More than 100 branches of India Post Payment Bank will be set up in the North-East region to expand the banking services.
  • Budgetary allocation:This year, there has been a provision of Rs. 2.66 lakh crore (US$ 31.84 billion) for rural development including rural infrastructure.

  Priority 4: Manufacturing & Services

  • Support for promotion of MSMEs: Special attention has been given to MSMEs and manufacturing, particularly labour-intensive manufacturing along with formulating a package covering financing, regulatory changes and technology support for MSMEs to help them grow and compete globally. Below are some of the measures specifically designed for MSMEs:
    • Credit guarantee scheme for MSMEs in the manufacturing sector:A credit guarantee scheme will be introduced for MSMEs to obtain term loans for machinery and equipment purchase without collateral or third-party guarantee. The scheme will pool credit risks, with a self-financing guarantee fund providing cover up to Rs. 100 crore (US$ 11.97 million) per applicant, even for larger loan amounts. Borrowers will pay upfront and annual guarantee fees.
    • New assessment model for MSME credit: Public sector banks will internally assess MSMEs for credit and develop a new credit assessment model based on digital footprints, a modern alternative to traditional criteria. This approach will also cater to MSMEs without formal accounting systems.
    • Credit support to MSMEs during stress period: A new mechanism will support MSMEs in accessing credit during their stress period in the 'special mention account' (SMA) stage. Government-backed guarantees will ensure credit availability to prevent MSMEs from entering the non-performing asset (NPA) stage.
    • Mudra loans: The limit of Mudra loans will be enhanced to Rs. 20 lakh (US$ 23,896) from the current Rs. 10 lakh (US$ 11,948) for those entrepreneurs who have availed and successfully repaid previous loans under the ‘Tarun’ category.
    • Enhanced scope for mandatory onboarding in TReDS: The turnover threshold for mandatory onboarding on the TReDS platform will be reduced from Rs. 500 crore (US$ 59.86 million) to Rs. 250 crore (US$ 29.93 million), adding 22 CPSEs and 7,000 companies. Medium enterprises will also be included as suppliers.
    • SIDBI branches in MSME clusters: SIDBI will open new branches to serve all major MSME clusters within 3 years, providing direct credit. By opening 24 branches this year, the service coverage will expand to 168 out of 242 major clusters.
    • MSME units for food irradiation, quality & safety testing: Financial support for setting up of 50 multi-product food irradiation units in the MSME sector will be provided. Setting up of 100 food quality and safety testing labs with NABL accreditation will be facilitated.
    • E-commerce export hubs: To enable MSMEs and traditional artisans to sell their products in international markets, E-commerce export hubs will be set up in the public private-partnership (PPP) mode.
  • Measures for promotion of manufacturing services:
    • Internship in top companies: A scheme will provide internship opportunities in 500 top companies to 1 crore youth over 5 years. Participants will receive a monthly allowance of Rs. 5,000 and a one-time assistance of Rs. 6,000. Companies will bear the training cost, and 10% of the internship cost can be allocated from their CSR funds.
    • Industrial parks: The government will facilitate the development of investment-ready “plug and play” industrial parks with complete infrastructure in or near 100 cities, in partnership with the states and private sector, by better using town planning schemes. A total of 12 industrial parks under the National Industrial Corridor Development Programme will also be sanctioned.
    • Rental housing: Rental housing with dormitory-type accommodation for industrial workers will be facilitated in the PPP mode with viability gap funding (VGF) support and commitment from anchor industries.
    • Shipping industry: Ownership, leasing and flagging reforms will be implemented to improve the share of the Indian shipping industry and generate more employment.
    • Critical Mineral Mission: Setting up of the Critical Mineral Mission for domestic production, recycling of critical minerals and overseas acquisition of critical mineral assets.
    • Offshore mining of minerals: The government will launch the auction of the first tranche of offshore blocks for mining, building on the exploration already carried out.
    • Digital public infrastructure (DPI) applications: Development of DPI applications at the population scale is proposed to drive productivity and innovation in the services sector. Applications will cover credit, e-commerce, education, health, law and justice, logistics, MSME, services delivery and urban governance.
    • Integrated technology platform for IBC eco-system: An integrated technology platform will be set up for improving the outcomes under the Insolvency and Bankruptcy Code (IBC) for achieving consistency, transparency, timely processing and better oversight for all stakeholders.
    • Voluntary closure of LLPs: The services of the Centre for Processing Accelerated Corporate Exit (C-PACE) will be extended for the voluntary closure of LLPs to reduce the closure time.
    • National Company Law Tribunals: The IBC has resolved 1,000+ companies, recovering over Rs. 3.3 lakh crore (US$ 39.51 billion) for creditors. A total of 28,000 cases involving Rs. 10 lakh crore (US$ 119.72 billion) have been disposed of. Reforms will be made to speed up insolvency resolution, including establishing additional tribunals to exclusively handle the Companies Act cases.

  Priority 5: Urban Development

  • Urban housing: PM Awas Yojana Urban 2.0 will address housing needs for 1 crore urban families with an investment of Rs. 10 lakh crore (US$ 119.72 billion), including Rs. 2.2 lakh crore (US$ 26.34 billion) central assistance over 5 years. Interest subsidies for affordable loans and improved rental housing market policies will also be implemented.
  • Transit-oriented development: Transit-oriented development plans for 14 large cities with a population above 30 lakh will be formulated, along with an implementation and financing strategy.
  • Stamp duty: States charging a high stamp duty will be encouraged to lower rates for all and consider further reductions for properties bought by women. This reform will be integrated as a key element of urban development schemes.
  • Cities as Growth Hubs: Collaborating with states, the government will promote the development of 'Cities as Growth Hubs' by focusing on economic and transit planning, as well as the organised development of peri-urban areas using town-planning schemes.
  • Water supply and sanitation: In collaboration with state governments and multilateral development banks, the government will support water supply, sewage treatment and solid waste management projects for 100 large cities through bankable projects. These initiatives will include the use of treated water for irrigation and filling tanks in nearby areas.
  • Street markets: Expanding on the success of the PM SVANidhi Scheme for street vendors, the Government plans to establish 100 weekly 'haats' or street food hubs annually in select cities over the next five years.

  Priority 6: Energy Security

  • Energy transition: The government will release a policy document outlining energy transition pathways to ensure sustainable economic growth, energy security and environmental sustainability.
  • PM Surya Ghar Muft Bijli Yojana: The PM Surya Ghar Muft Bijli Yojana aims to provide free electricity up to 300 units per month through rooftop solar plants to 1 crore households. With over 1.28 crore registrations and 14 lakh applications, the scheme has received significant interest and will be further promoted.
  • Pumped storage policy: A policy for promoting pumped storage projects will be brought out for electricity storage and facilitating smooth integration of the growing share of renewable energy with its variable & intermittent nature in the overall energy mix.
  • Research and development of small and modular nuclear reactors: The government will collaborate with the private sector to establish Bharat Small Reactors, conduct research on Bharat Small Modular Reactors and develop new technologies for nuclear energy. R&D funding allocated in the interim budget will support these initiatives.
  • Advanced ultra super critical (AUSC) thermal power plants: The development of an indigenous technology for AUSC thermal power plants with a much higher efficiency has been completed. A joint venture between NTPC and BHEL will set up a full-scale 800 MW commercial plant using the AUSC technology.
  • Support to traditional micro and small industries: An investment-grade energy audit of traditional micro and small industries in 60 clusters, including brass and ceramic, will be facilitated. The scheme will be replicated in another 100 clusters in the next phase.

  Priority 7: Infrastructure

  • Infrastructure investment by central government: The government has allocated Rs. 11,11,111 crore (US$ 133.02 billion) for capital expenditure, which is 3.4% of the country’s GDP.
  • Infrastructure investment by state governments: A provision of Rs. 1.5 lakh crore (US$ 17.96 billion) for long-term interest free loans has been made this year to support the states in their resource allocation.
  • Private investment in infrastructure: Investment in infrastructure by the private sector will be promoted through VGF and enabling policies and regulations.
  • Pradhan Mantri Gram Sadak Yojana (PMGSY): Phase IV of PMGSY will be launched to provide all-weather connectivity to 25,000 rural habitations that have become eligible in view of their population increase.
  • Irrigation and flood mitigation: The government, through the Accelerated Irrigation Benefit Programme and other sources, will provide financial support for projects with estimated cost of Rs. 11,500 crore (US$ 1.38 billion) such as the Kosi–Mechi intra-state link and 20 other ongoing and new schemes including barrages, river pollution abatement and irrigation projects. There will be assistance to Assam for flood management and related projects. The government will aid Himachal Pradesh for reconstruction and rehabilitation through multilateral development assistance. There will be additional assistance provided to the states of Uttarakhand and Sikkim due to the massive landslides, floods and cloud bursts experienced by them last year.
  • Tourism: Tourism has been an integral part of the country’s civilisation. Following are some of the measures that will be taken to boost tourism.
    • The Vishnupad Temple Corridor and Mahabodhi Temple Corridor will be supported and modelled on the successful example of the Kashi Vishwanath Temple Corridor to transform them into world class pilgrim and tourist destinations.
    • Rajgir holds immense religious significance for Hindus, Buddhists and Jains. A comprehensive development initiative for Rajgir will be undertaken.
    • Support the development of Nalanda as a tourist centre besides reviving Nalanda University to its glorious stature.
    • Aid the development of Odisha’s tourism spots.

  Priority 8: Innovation, Research & Development

  • The government will operationalise the Anusandhan National Research Fund for basic research and prototype development. Further, it will set up a mechanism for spurring private sector-driven research and innovation at commercial scale with a financing pool of Rs. 1 lakh crore (US$ 11.97 billion) in line with the announcement in the interim budget.
  • Space economy: With the government’s continued emphasis on expanding the space economy by 5 times in the next 10 years, a venture capital fund of Rs. 1,000 crore (US$ 119.72 million) will be set up.

  Priority 9: Next Generation Reforms

  • Economic policy framework: The government will initiate and incentivise reforms for (1) improving productivity of factors of production, and (2) facilitating markets and sectors to become more efficient. For promoting competitive federalism and incentivising states for faster implementation of reforms, the government proposes to earmark a significant part of the 50-year interest-free loan. Working with the states, the government will initiate the following reforms:
  • Land-related reforms by state governments: Land-related reforms and actions, both in rural and urban areas, will cover (1) land administration, planning and management, and (2) urban planning, usage and building bylaws and will be incentivised for completion within the next 3 years.
    • Rural-land-related actions: This will include:
      • assignment of Unique Land Parcel Identification Number (ULPIN) or Bhu-Aadhaar for all lands;
      • digitalisation of cadastral maps;
      • survey of map sub-divisions as per current ownership;
      • establishment of land registry;
      • linking to the farmers registry.
    • Urban-land-related actions: Land records in urban areas will be digitalised with GIS mapping. Further, an IT-based system for property record administration, updating, and tax administration will be established.
  • Labour-related reforms
    • Services to labour: A comprehensive integration of the e-Shram portal with other portals will facilitate such one-stop solution. Open architecture databases for the rapidly changing labour market, skill requirements and available job roles, and a mechanism to connect job-aspirants with potential employers and skill providers will be covered in these services.
    • Shram Suvidha & Samadhan portals: Shram Suvidha and Samadhan portals will be revamped to enhance ease of compliance for industry and trade.
  • Capital and entrepreneurship related reforms
    • Financial sector vision and strategy: To meet the financing needs of the economy, the government will bring out a financial sector vision and strategy document to prepare the sector in terms of size, capacity and skills and set the agenda for the next 5 years.
    • Taxonomy for climate finance: The government will develop a taxonomy for climate finance to enhance the availability of capital for climate change adaptation and mitigation.
    • Variable capital company structure: The government will seek the required legislative approval for providing an efficient and flexible mode for financing leasing of aircraft and ships, and pooled funds of private equity through a ‘variable company structure’.
    • Foreign direct investment and overseas investment: The rules and regulations for foreign direct investment and overseas investments will be simplified to (1) facilitate foreign direct investments, (2) nudge prioritisation and (3) promote opportunities to use the Indian Rupee as a currency for overseas investments.
    • NPS Vatsalya: NPS Vatsalya, a plan for contribution by parents and guardians for minors will be started. Upon attaining the age of majority, the plan will be converted into a normal NPS account.
    • Use of technology: Public investment in digital infrastructure and innovations by the private sector have helped in improving access of all citizens, particularly the common people, to market resources, education, health and services.
    • Ease of doing business: For enhancing ‘Ease of Doing Business’, the government is already working on the Jan Vishwas Bill 2.0.
    • Data and statistics: For improving data governance, collection, processing and management of data and statistics, different sectoral data bases, including those established under the Digital India mission, will be utilised with active use of technology tools.
    • New Pension Scheme (NPS): The committee formed to review NPS has made considerable progress in its work as the Staff Side of the National Council of the Joint Consultative Machinery for Central Government Employees has taken a constructive approach.
  • Budget Estimates 2024-25
    • For 2024-25, the total receipts other than borrowings and the total expenditure are estimated at Rs. 32.07 lakh crore (US$ 383.93 billion) and Rs. 48.21 lakh crore (US$ 577.16 billion), respectively.
    • The net tax receipts are estimated at Rs. 25.83 lakh crore (US$ 309.23 billion).
    • The fiscal deficit is estimated at 4.9% of GDP.
    • The gross and net market borrowings through dated securities during 2024-25 are estimated at Rs. 14.01 lakh crore (US$ 167.72 billion) and Rs. 11.63 lakh crore (US$ 139.23 billion), respectively; both will be less than that in 2023-24.
    • The fiscal consolidation path announced by the Union Minister of Finance and Corporate Affairs, Ms. Nirmala Sitharaman, in 2021 has served the economy very well, as the economy aims to reach a deficit below 4.5% next year, while the government is committed to staying the course.
    • From 2026-27 onwards, the government’s endeavour will be to target a fiscal deficit each year such that the central government debt as percentage of GDP will be on a declining path.