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Written By: Taruni Choubey (Columnist) and Niharika R (Columnist)
On January 24, 2024, the ceremonial Halwa Ceremony marked the symbolic conclusion of the budget preparation process. Fast forward to the inaugural day of 1 February – Indian Finance Minister Smt. Nirmala Sitharaman carried her iconic red briefcase adorned with a confident smile. With unwavering optimism, she went on to announce the Interim Budget for the Financial Year (2024–2025) in the hallowed halls of the Lok Sabha. This budget is a financial interlude leading up to the imminent 2024 Lok Sabha elections.
Having witnessed profound economic growth over the past decade, FM Sitharaman set the stage with a narrative of hope and optimism for the future. The crux of the budget lay in the Prime Minister's commitment to uplifting four pivotal sections of society - the 'Garib' (Poor), 'Mahilayen' (Women), 'Yuva' (Youth), and 'Annadata' (Farmer).
Ms. Sitharaman highlighted that the average real income of Indians has risen by 50 percent, more than 25 crore people have been lifted from poverty while the economy has catapulted to the world’s fifth-largest from the 10th in the last decade.Top of FormBottom of Form PM-SVANidhi has provided credit assistance to 78 lakh street vendors while PM-Vishwakarma Yojana has provided end-to-end support to artisans and crafts people engaged in 18 trades.
In his Independence Day speech last year, Prime Minister Shri Narendra Modi had announced the ‘Lakhpati Didi’ scheme to provide skill development training to 2 crore women in villages across the country. Today, 83 lakh self-help groups (SHGs) with nine crore women are spearheading rural socio-economic transformation. This has resulted in one crore women achieving lakhpati didi status, prompting a decision to raise the target from 2 crore to 3 crore.
A 28% increase has been witnessed in female enrolment in higher education over the past decade. Additionally, legal measures like banning triple talaq, 1/3 reservation of seats for women in Parliament and state assemblies, and allocating over 70% of PM Awas Yojana houses to women have enhanced their dignity.
To empower the youth, the National Education Policy 2020 and PM Schools for Rising India (PM SHRI) are driving transformative reforms. The Skill India Mission has trained 1.4 crore youth and established 3,000 new ITIs (Industrial Training Institutes). To further young entrepreneurial aspirations, PM Mudra Yojana has sanctioned 43 crore loans totalling 22.5 Lakh crore.
The efforts towards the Indian agricultural sector are enhancing farmers’ incomes. The Pradhan Mantri Kisan Sampada Yojana has benefitted 38 Lakh farmers. Further, the Pradhan Mantri Formalisation of Micro Food Processing Enterprises Yojana has helped 2.4 Lakh SHGs and sixty thousand individuals with credit linkages. A strategy will be formulated to achieve ‘Atmanirbharta’ (independence) for oil seeds such as mustard, groundnut, sesame, soybean, and sunflower.
Though the government’s decision to keep import duties and other tax rates the same was a big disappointment to tax payers, the Finance Minister stated that the tax collection has more than doubled over the last 10 years. Budgets for capital expenditures have been increased to a historic high of to ₹11.11 lakh crore for 2024–2025. Additionally, the FDI inflow between 2014-2023 has been $596 billion, marking it as a golden era for the Indian economy. The government aims to reduce the fiscal deficit to 4.5% of GDP by 2025–2026 which currently stands at 5.8%. Furthermore, a generous corpus of Rs.1 lakh crore has been set aside to provide 50-year interest free loans to the private sector to scale up research in sunrise domains. India will soon achieve the target of building three crore houses under the PM Awas Yojana. Two crore more houses will be taken up in the next five years.
The railways have been allocated a budget of 2.55 Lakh crore. The government has also announced three major railway corridors – the port connectivity corridor, the energy, the mineral, and cement corridor, and the high traffic density corridor. The Vande Bharat requirements will be applied to 40,000 standard rail bogeys to increase convenience. The number of airports has doubled to 149 and the rollout of air connectivity to tier-two and tier-three cities under the UDAN 19 scheme has been widespread. Expansion of existing airports and development of new airports is expected to continue expeditiously.
Healthcare is yet another major focus area. It has been allotted a budget of 90,000 crore, with major focus on cervical cancer vaccination for young girls. The healthcare insurance cover under the Ayushman Bharat scheme will now extend to all ASHA staff members, Anganwadi workers and assistants.
The budget unveiled multiple programmes to achieve Net Zero by 2070. These include financing the initial 1 Giga Watt of offshore wind energy generation, buying equipment for biomass aggregation, and growing the e-vehicle industry by promoting more infrastructure for manufacture and charging. Through rooftop solarization, one crore households are expected to obtain up to 300 units of free electricity a month.
The administration aims to rewamp the island Union Territory of Lakshadweep, investing around 1,000 crore for the same, amidst the recent turmoil between India and Maldives. This is also expected to help in generating employment opportunities.
A complete budget will be presented later this year in July after the elections. Two new measures are scheduled to be presented during this session: the Water (Prevention, Control, and Restoration of Pollution) Amendment Bill, 2024, and the Public Examination (Prevention of Unfair Means) Bill, 2024. The Finance Minister is confident that the nation can become a developed nation by 2047 and a $7 trillion economy by 2030. India’s economic future is very promising, driven by a dynamic workforce and digitalization.
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