Highlights of Union Budget 2024: What It Means for India

The Union Budget this year took place on July 23, 2024. Known as the Annual Financial Statement, it was presented by the Finance Minister, Nirmila Sitharaman. With a comprehensive outlook for the upcoming fiscal year (April 1, 2024 to March 31, 2025), the Government of India presents the policies that reflect crucial economic priorities and aims. The budget also calculates allocations of material expenditure and reforms for the success of growth and insurance of stability for all people. Let’s explore some of the key aspects of the meeting and the trajectories it shifts for the nation.

Priority 1: Productivity and resilience in agriculture.

The budget highlights productivity and resilience in agriculture by transforming agriculture research through a comprehensive review of the agriculture research setup as well as the release of 109 new high-yielding and climate resilient varieties of 32 field and horticulture crops. It also promotes initiation of farmers into natural farming and shrimp farming, processing and export.

Priority 2: Employment and Skilling

This year, there is a strong incentive in place to benefit employment in all sectors. This strategy includes three schemes. Scheme A refers to First Timers and includes the funding of 15000 INR in 3 installments for new entries in formal sectors. With Scheme B, Job Creation in Manufacturing, the goal is to support new employees and employers for EPFO contributions for 4 years. Lastly, Scheme C involves Support to Employers where the government will reimburse EPFO contributions to employers up to 3000 INR per month for 2 years for all new hires. In all, this incentive will contribute to the better livelihood of 250 lakh youth. There is also a major priority in the inclusion of women and setting up working environments with collaborations in various industries. Loans up to 7.5 lakh INR will be provided by the government and financial aid will be delivered for domestic higher education in up to 10 lakh INR.

The skilling program will include 1,000 Industrial Training Institutes being upgraded with outcome orientation. Along with this, course content will be specifically altered as per required skills in industry. This includes 20 lakh youth being skilled over a course of 5 years.

Priority 3: Inclusive Human Resource Development and Social Justice

With several initiatives on this year’s agenda, there are all sorts of developments being made for underserved audiences. The Purvodaya, is a plan for the endowment of rich states in the East, such as Bihar, West Bengal and Odisha, in order to generate further economic opportunities. There will be an allocation of 3 lakh crore INR in benefitting women. Additionally, the Pradhan Mantri Janjatiya Unnat Gram Abhiyan, is a cause started to improve the socio-economic conditions of tribal villages, benefitting 5 crore of the population. India Post Payment Bank will set up 100 more branches in the NorthEast region. Financial support for essential infrastructure such as railways, roads in Chennai, Bengaluru and Hyderabad will ensure security of the nation.

Priority 4: Manufacturing and services

This priority primarily focuses on the support for the promotion of MSMEs, with Credit Guarantee Schemes, units for food irradiation, quality & safety testing as well as internship opportunities under the PM’s Package (5th Scheme). Twelve industrial parks are also to be set up under the National Industrial Corridor Development Programme.

Priority 5: Urban Development

A number of tactical operations will be undertaken for this priority. It includes stamp duty, which encourages lower stamp duties for women. Street markets will be organized with 100 weekly ‘haats’ for street food in cities. The transit oriented development plans include 14 large cities, beneficial for 30 lakh people. And lastly, water management will promote water supply, sewage treatment and solid waste management projects for 100 large cities. In terms of housing needs, the needs of urban poor and middle class populations will be served with an investment of 10 lakh crore INR. Within this, the act of enabling policies and regulations for freer rental housing markets will advance accessibility for those in need.

Priority 6: Energy Security

This priority focuses on initiatives with the private sector in nuclear energy, which includes setting up small reactors and promoting newer technologies. The Pumped Storage Policy targets the more sustainable facilitation and integration of renewable energy. There is also a harness on thermal energy, with a full scale 800 MW commercial plant to be set up. And, with the harness of solar power, the goal is for 1 crore households to obtain free electricity. Overall, there will be an energy audit in order to shift micro industries to cleaner energies at a much larger scale.

Priority 7: Infrastructure

There is a provision of 1,111,111 crore INR for the overall development of infrastructure. PMGSY’s fourth phase will be dedicated to launching weather connections to 25,000 rural habitations. To lessen the damages of flood and irrigation, assistance projects will be placed in Assam, Sikkim and Uttarakhand. Elsewhere in Himachal Pradesh, aid for reconstruction and rehabilitation will be provided. For mass projects such as the Kosi-Mecha intra-state link and others, financial support with an estimated cost of 11,500 INR will be appointed. Moreover, as tourism flourishes over the country, monuments, wildlife sanctuaries and beaches will be further developed, predominantly in Odisha. The Vishnupad and Mahabodhi Temple Corridors will be remodeled, as well as the significant undergoing progress for Rajgir and Nalanda.

Priority 8: Innovation, Research & Development

The Anusudhan National Research Fund for basic research and prototype development is to be operationalized. Furthermore, a mechanism for spurring private sector-driven research and innovation at commercial scale is to be established with a financial pool of INR 1 Lakh Cr. The space economy is also set for expansion by 5 times in the next 10 years owing to the government's continued emphasis in the area - leading to the set up of a venture capital fund of INR 1000 cr.

Priority 9: Next Generation Reforms

A number of reforms are to be initiated in areas of rural & urban land related actions with the establishment of land registry and survey of map subdivisions as per current ownership, FDI and Overseas Investments with simplifications to facilitate FDIs and promote opportunities for using Indian Rupee as a currency for overseas investments. The New Pension Scheme (NPS), a solution that addresses the relevant issues, protects the common citizen and maintains fiscal prudence will be formed. The priority also emphasizes the improvement of data governance, collection, processing and management of data and statistics.

Taxes

A comprehensive review of the rate structure over the next six months will rationalize and simplify customs duty rates to facilitate trade, remove duty inversion, and reduce disputes. Simplifications include a review of Income Tax Act 1961, simplification of charities and TDS, litigation and appeal and deepening the tax base. Direct Tax Proposals aim to reduce the compliance burden, promote entrepreneurial spirit and provide tax relief to citizens.

Expenditure & Receipts

The main source of revenue for the government is to be earned from Borrowing and Other Liabilities (27%), followed by Income Tax (19%) and other taxes. The defense sector will be the most spent on with INR 4,54,773 cr. being allotted to it. Rural development follows it with INR 2,65,808 cr. The budget is to focus on funding major schemes such as MGNREGA, Nuclear Power Projects and Research and Development Projects.

In conclusion, a strategic vision to promote social and economic development is reflected in India's 2024 Union Budget. Together with targeted investments, the government's commitment to fiscal prudence creates the conditions for a dynamic and sustainable economic trajectory. These budgetary measures aim to propel India into a brighter future by addressing both immediate concerns and long-term aspirations as the country navigates the challenges ahead.