On February 1, 2024, Finance Minister Nirmala Sitharaman unveiled the interim budget, setting the stage for the upcoming Lok Sabha elections. This provisional budget prioritizes the continuity of existing policies until the new government unveils the final Union Budget for 2024-2025, expected in July. Here are the key takeaways from the interim budget announcement that will shape India’s economic trajectory in the coming fiscal year.
1. Capital Expenditure Boost:
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– The capital expenditure target for FY24-25 is raised by 11.1%, reaching 11.1 lakh crore, constituting 3.4% of the GDP.
2. Revised and Budget Estimates:
– FY23-24 saw revised estimates with total receipts, excluding borrowings, at 27.56 lakh crore and tax receipts at 23.24 lakh crore.
– For FY24-25, estimated total receipts are 30.80 lakh crore, total expenditure at 47.66 lakh crore, and tax receipts at 26.02 lakh crore, with a fiscal deficit projected at 5.1% of GDP.
3. Income Tax Stability:
– No alterations were made to income tax slabs, with the government opting to maintain existing tax rates for both direct and indirect taxes, including import duties.
4. Agriculture, Food Processing, and Fisheries:
– Emphasis on private and public investment in post-harvest activities and a boost for the Pradhan Mantri Matsya Sampada Yojana (PMMSY) to enhance aquaculture productivity and generate employment.
5. Railways Development:
– Introduction of three new corridors under the PM Gati Shakti Scheme – Energy, Mineral and Cement corridor, Port Connectivity Corridor, and High Traffic Density Corridor.
– Conversion of 40,000 rail bogies to Vande Bharat standards for improved safety and passenger comfort.
6. Healthcare Initiatives:
– Extension of Ayushman Bharat scheme to cover ASHA workers, Anganwadi Workers, and Helpers.
– Encouragement of vaccination for girls aged 9 to 14 for cervical cancer prevention.
7. Energy Sector Reforms:
– Introduction of a rooftop solarisation scheme benefiting 1 crore households.
– Initiatives for offshore wind energy, coal gasification, and phased mandatory blending of compressed biogas in natural gas for transport and domestic purposes.
8. Housing for Middle-Class:
– Launch of a scheme to assist the middle class in acquiring or building their own houses.
– Commitment to providing 2 crore additional houses under PMAY-Gramin in five years.
9. Blue Economy Boost:
– Support for the ‘blue economy’ initiative with a scheme for climate-resilient activities, coastal aquaculture, and mariculture.
10. Viksit Bharat Vision:
– Establishment of a high-powered committee to address challenges arising from population growth and demographic changes, aligning with the goal of ‘Viksit Bharat’ – transforming India into a developed nation by 2047.
As the interim budget sets the stage for the forthcoming elections, stakeholders eagerly anticipate the detailed Union Budget in July, which will likely provide more clarity on the government’s long-term economic strategy.
