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BUDGET 2024-2025|NIRMALA SEETHARAMAN
Budget 2024-2025
Speech of
Nirmala Sitharaman
Minister of Finance
July 23, 2024
Hon’ble Speaker,
I present the Budget for 2024-25.
Introduction
1. The people of India have reposed their faith in the government led by
the Hon’ble Prime Minister Shri Narendra Modi and re-elected it for a historic
third term under his leadership. We are grateful for their support, faith and
trust in our policies. We are determined to ensure that all Indians, regardless
of religion, caste, gender and age, make substantial progress in realising their
life goals and aspirations.
Global Context
2. The global economy, while performing better than expected, is still in
the grip of policy uncertainties. Elevated asset prices, political uncertainties
and shipping disruptions continue to pose significant downside risks for
growth and upside risks to inflation.
3. In this context, India’s economic growth continues to be the shining
exception and will remain so in the years ahead. India’s inflation continues to
be low, stable and moving towards the 4 per cent target. Core inflation (nonfood, non-fuel) currently is 3.1 per cent. Steps are being taken to ensure
supplies of perishable goods reach market adequately.
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Interim Budget
4. As mentioned in the interim budget, we need to focus on 4 major
castes, namely ‘Garib’ (Poor), ‘Mahilayen’ (Women), ‘Yuva’ (Youth) and
‘Annadata’ (Farmer). For Annadata, we announced higher Minimum Support
Prices a month ago for all major crops, delivering on the promise of at least a
50 per cent margin over costs. Pradhan Mantri Garib Kalyan Anna Yojana was
extended for five years, benefitting more than 80 crore people.
5. Administrative actions for approval and implementation of various
schemes announced in the interim budget are well underway. The required
allocations have been made.
Budget Theme
6. Turning attention to the full year and beyond, in this budget, we
particularly focus on employment, skilling, MSMEs, and the middle class. I am
happy to announce the 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 ` 2 lakh crore. I will speak about
them shortly, while more details may be seen in the annexure. This year, I
have made a provision of ` 1.48 lakh crore for education, employment and
skilling.
Budget Priorities
7. The people have given a unique opportunity to our government to
take the country on the path of strong development and all-round prosperity.
In the interim budget, we promised to present a detailed roadmap for our
pursuit of ‘Viksit Bharat’. In line with the strategy set out in the interim
budget, this budget envisages sustained efforts on the following 9 priorities
for generating ample opportunities for all.
1) Productivity and resilience in Agriculture
2) Employment & Skilling
3) Inclusive Human Resource Development and Social Justice
4) Manufacturing & Services
5) Urban Development
6) Energy Security
7) Infrastructure
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8) Innovation, Research & Development and
9) Next Generation Reforms
8. Subsequent budgets will build on these, and add more priorities and
actions. A more detailed formulation will be carried out as part of the
‘economic policy framework’ about which I will speak later in this speech.
9. This budget details some of the specific actions to be initiated in the
current year towards fulfilment of these priorities with potential for
transformative changes. The budget also covers some of the previously
made announcements with an intent to strengthen them and step up their
implementation for expediting our journey towards the goal of Viksit Bharat.
Priority 1: Productivity and resilience in Agriculture
Transforming agriculture research
10. Our 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 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
11. New 109 high-yielding and climate-resilient varieties of 32 field and
horticulture crops will be released for cultivation by farmers.
Natural Farming
12. 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. 10,000 need-based bio-input resource centres will be
established.
Missions for pulses and oilseeds
13. For achieving self-sufficiency in pulses and oilseeds, we will
strengthen their production, storage and marketing. As announced in the
interim budget, a strategy is being put in place to achieve ‘atmanirbharta’ for
oil seeds such as mustard, groundnut, sesame, soybean, and sunflower.
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Vegetable production & Supply Chains
14. Large scale clusters for vegetable production will be developed closer
to major consumption centres. We will promote Farmer-Producer
Organizations, cooperatives and start-ups for vegetable supply chains
including for collection, storage, and marketing.
Digital Public Infrastructure for Agriculture
15. Buoyed by the success of the pilot project, our government, in
partnership with the states, will facilitate the implementation of the Digital
Public Infrastructure (DPI) in agriculture for coverage of farmers and their
lands in 3 years. During this year, digital crop survey for Kharif using the DPI
will be taken up in 400 districts. The details of 6 crore farmers and their lands
will be brought into the farmer and land registries. Further, the issuance of
Jan Samarth based Kisan Credit Cards will be enabled in 5 states.
Shrimp Production & Export
16. Financial support for setting up a network of Nucleus Breeding
Centres for Shrimp Broodstocks will be provided. Financing for shrimp
farming, processing and export will be facilitated through NABARD.
National Cooperation Policy
17. Our government will bring out a National Cooperation Policy for
systematic, orderly and all-round development of the cooperative sector.
Fast-tracking growth of rural economy and generation of employment
opportunities on a large scale will be the policy goal.
18. This year, I have made a provision of ` 1.52 lakh crore for agriculture
and allied sector.
Priority 2: Employment & Skilling
Employment Linked Incentive
19. Our government will implement following 3 schemes for ‘Employment
Linked Incentive’, as part of the Prime Minister’s package. These will be
based on enrolment in the EPFO, and focus on recognition of first-time
employees, and support to employees and employers.
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Scheme A: First Timers
20. This scheme will provide one-month wage to all persons newly
entering the workforce in all formal sectors. The direct benefit transfer of
one-month salary in 3 instalments to first-time employees, as registered in
the EPFO, will be up to ` 15,000. The eligibility limit will be a salary of
` 1 lakh per month. The scheme is expected to benefit 210 lakh youth.
Scheme B: Job Creation in manufacturing
21. This scheme will incentivize additional employment in the
manufacturing sector, linked to the employment of first-time employees. An
incentive will be provided at specified scale directly both to the employee
and the employer with respect to their EPFO contribution in the first 4 years
of employment. The scheme is expected to benefit 30 lakh youth entering
employment, and their employers.
Scheme C: Support to employers
22. This employer-focussed scheme will cover additional employment in
all sectors. All additional employment within a salary of ` 1 lakh per month
will be counted. The government will reimburse to employers up to ` 3,000
per month for 2 years towards their EPFO contribution for each additional
employee. The scheme is expected to incentivize additional employment of
50 lakh persons.
Participation of women in the workforce
23. We will facilitate higher participation of women in the workforce
through setting up of working women hostels in collaboration with industry,
and establishing creches. In addition, the partnership will seek to organize
women-specific skilling programmes, and promotion of market access for
women SHG enterprises.
Skilling programme
24. I am happy to announce a new centrally sponsored scheme, as the 4th
scheme under the Prime Minister’s package, for skilling in collaboration with
state governments and Industry. 20 lakh youth will be skilled over a 5-year
period. 1,000 Industrial Training Institutes will be upgraded in hub and spoke
arrangements with outcome orientation. Course content and design will be
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aligned to the skill needs of industry, and new courses will be introduced for
emerging needs.
Skilling Loans
25. The Model Skill Loan Scheme will be revised to facilitate loans up to
` 7.5 lakh with a guarantee from a government promoted Fund. This measure
is expected to help 25,000 students every year.
Education Loans
26. For helping our youth who have not been eligible for any benefit
under government schemes and policies, I am happy to announce a financial
support for loans upto ` 10 lakh for higher education in domestic institutions.
E-vouchers for this purpose will be given directly to 1 lakh students every
year for annual interest subvention of 3 per cent of the loan amount.
Priority 3: Inclusive Human Resource Development and Social Justice
Saturation approach
27. Our government is committed to all-round, all-pervasive and allinclusive development of people, particularly, farmers, youth, women and
poor. For achieving social justice comprehensively, the saturation approach
of covering all eligible people through various programmes including those
for education and health will be adopted to empower them by improving
their capabilities.
28. Implementation of schemes meant for supporting economic activities
by craftsmen, artisans, self-help groups, scheduled caste, schedule tribe and
women entrepreneurs, and street vendors, such as PM Vishwakarma, PM
SVANidhi, National Livelihood Missions, and Stand-Up India will be stepped
up.
Purvodaya
29. The states in the Eastern part of the country are rich in endowments
and have strong cultural traditions. We will formulate a plan, Purvodaya, for
the all-round development of the eastern region of the country covering
Bihar, Jharkhand, West Bengal, Odisha and Andhra Pradesh. This will cover
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human resource development, infrastructure, and generation of economic
opportunities to make the region an engine to attain Viksit Bharat.
30. On the Amritsar Kolkata Industrial Corridor, we will support
development of an industrial node at Gaya. This corridor will catalyze
industrial development of the eastern region. The industrial node at Gaya will
also be a good model for developing our ancient centres of cultural
importance into future centres of modern economy. This model shall
showcase “Vikas bhi Virasat bhi” in our growth trajectory.
31. We will also support development of road connectivity projects,
namely (1) Patna-Purnea Expressway, (2) Buxar-Bhagalpur Expressway, (3)
Bodhgaya, Rajgir, Vaishali and Darbhanga spurs, and (4) additional 2-lane
bridge over river Ganga at Buxar at a total cost of ` 26,000 crore. Power
projects, including setting up of a new 2400 MW power plant at Pirpainti, will
be taken up at a cost of ` 21,400 crore. New airports, medical colleges and
sports infrastructure in Bihar will be constructed.
32. An additional allocation to support capital investments will be
provided. The requests of Bihar Government for external assistance from
multilateral development banks will be expedited.
Andhra Pradesh Reorganization Act
33. Our government has made concerted efforts to fulfil the
commitments in the Andhra Pradesh Reorganization Act. Recognizing the
state’s need for a capital, we will facilitate special financial support through
multilateral development agencies. In the current financial year ` 15,000
crore will be arranged, with additional amounts in future years.
34. Our government is fully committed to financing and early completion
of the Polavaram Irrigation Project, which is the lifeline for Andhra Pradesh
and its farmers. This will facilitate our country’s food security as well.
35. Under the Act, for promoting industrial development, funds will be
provided for 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. An additional
allocation will be provided this year towards capital investment for economic
growth.
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36. Grants for backward regions of Rayalaseema, Prakasam and North
Coastal Andhra, as stated in the Act, will also be provided.
PM Awas Yojana
37. 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
38. For promoting women-led development, the budget carries an
allocation of more than ` 3 lakh crore for schemes benefitting women and
girls. This signals our government’s commitment for enhancing women’s role
in economic development.
Pradhan Mantri Janjatiya Unnat Gram Abhiyan
39. For improving the socio-economic condition of tribal communities, we
will launch the Pradhan Mantri Janjatiya Unnat Gram Abhiyan by adopting
saturation coverage for tribal families in tribal-majority villages and
aspirational districts. This will cover 63,000 villages benefitting 5 crore tribal
people.
Bank branches in North-Eastern Region
40. More than 100 branches of India Post Payment Bank will be set up in
the North East region to expand the banking services.
41. This year, I have made a provision of ` 2.66 lakh crore for rural
development including rural infrastructure.
Priority 4: Manufacturing & Services
Support for promotion of MSMEs
42. This budget provides special attention to MSMEs and manufacturing,
particularly labour-intensive manufacturing. We have formulated a package
covering financing, regulatory changes and technology support for MSMEs to
help them grow and also compete globally, as mentioned in the interim
budget. I am happy to announce the following specific measures.
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Credit Guarantee Scheme for MSMEs in the Manufacturing Sector
43. For facilitating term loans to MSMEs for purchase of machinery and
equipment without collateral or third-party guarantee, a credit guarantee
scheme will be introduced. The scheme will operate on pooling of credit risks
of such MSMEs. A separately constituted self-financing guarantee fund will
provide, to each applicant, guarantee cover up to ` 100 crore, while the loan
amount may be larger. The borrower will have to provide an upfront
guarantee fee and an annual guarantee fee on the reducing loan balance.
New assessment model for MSME credit
44. Public sector banks will build their in-house capability to assess
MSMEs for credit, instead of relying on external assessment. They will also
take a lead in developing or getting developed a new credit assessment
model, based on the scoring of digital footprints of MSMEs in the economy.
This is expected to be a significant improvement over the traditional
assessment of credit eligibility based only on asset or turnover criteria. That
will also cover MSMEs without a formal accounting system.
Credit Support to MSMEs during Stress Period
45. I am happy to announce a new mechanism for facilitating
continuation of bank credit to MSMEs during their stress period. While being
in the ‘special mention account’ (SMA) stage for reasons beyond their
control, MSMEs need credit to continue their business and to avoid getting
into the NPA stage. Credit availability will be supported through a guarantee
from a government promoted fund.
Mudra Loans
46. The limit of Mudra loans will be enhanced to ₹ 20 lakh from the
current ₹ 10 lakh for those entrepreneurs who have availed and successfully
repaid previous loans under the ‘Tarun’ category.
Enhanced scope for mandatory onboarding in TReDS
47. For facilitating MSMEs to unlock their working capital by converting
their trade receivables into cash, I propose to reduce the turnover threshold
of buyers for mandatory onboarding on the TReDS platform from ` 500 crore
to ` 250 crore. This measure will bring 22 more CPSEs and 7000 more
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companies onto the platform. Medium enterprises will also be included in
the scope of the suppliers.
SIDBI branches in MSME clusters
48. SIDBI will open new branches to expand its reach to serve all major
MSME clusters within 3 years, and provide direct credit to them. With the
opening of 24 such branches this year, the service coverage will expand to
168 out of 242 major clusters.
MSME Units for Food Irradiation, Quality & Safety Testing
49. 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
50. To enable MSMEs and traditional artisans to sell their products in
international markets, E-Commerce Export Hubs will be set up in publicprivate-partnership (PPP) mode . These hubs, under a seamless regulatory
and logistic framework, will facilitate trade and export related services under
one roof.
Measures for promotion of Manufacturing & Services
Internship in Top Companies
51. As the 5th scheme under the Prime Minister’s package, our
government will launch a comprehensive scheme for providing internship
opportunities in 500 top companies to 1 crore youth in 5 years. They will gain
exposure for 12 months to real-life business environment, varied professions
and employment opportunities. An internship allowance of ` 5,000 per
month along with a one-time assistance of ` 6,000 will be provided.
Companies will be expected to bear the training cost and 10 per cent of the
internship cost from their CSR funds.
Industrial Parks
52. Our government will facilitate development of investment-ready
“plug and play” industrial parks with complete infrastructure in or near 100
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cities, in partnership with the states and private sector, by better using town
planning schemes.
53. Twelve industrial parks under the National Industrial Corridor
Development Programme also will be sanctioned.
Rental Housing
54. Rental housing with dormitory type accommodation for industrial
workers will be facilitated in PPP mode with VGF support and commitment
from anchor industries.
Shipping industry
55. Ownership, leasing and flagging reforms will be implemented to
improve the share of the Indian shipping industry and generate more
employment.
Critical Mineral Mission
56. We will set up a Critical Mineral Mission for domestic production,
recycling of critical minerals, and overseas acquisition of critical mineral
assets. Its mandate will include technology development, skilled workforce,
extended producer responsibility framework, and a suitable financing
mechanism.
Offshore mining of minerals
57. Our government will launch the auction of the first tranche of
offshore blocks for mining, building on the exploration already carried out.
Digital Public Infrastructure Applications
58. Turning to the services sector, I propose development of DPI
applications at population scale for productivity gains, business
opportunities, and innovation by the private sector. These are planned in the
areas of credit, e-commerce, education, health, law and justice, logistics,
MSME, services delivery, and urban governance.
Integrated Technology Platform for IBC eco-system
59. An Integrated Technology Platform will be set up for improving the
outcomes under the Insolvency and Bankruptcy Code (IBC) for achieving
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consistency, transparency, timely processing and better oversight for all
stakeholders.
Voluntary closure of LLPs
60. The services of the Centre for Processing Accelerated Corporate Exit
(C-PACE) will be extended for voluntary closure of LLPs to reduce the closure
time.
National Company Law Tribunals
61. The IBC has resolved more than 1,000 companies, resulting in direct
recovery of over ` 3.3 lakh crore to creditors. In addition, 28,000 cases
involving over ` 10 lakh crore have been disposed of, even prior to
admission.
62. Appropriate changes to the IBC, reforms and strengthening of the
tribunal and appellate tribunals will be initiated to speed up insolvency
resolution. Additional tribunals will be established. Out of those, some will be
notified to decide cases exclusively under the Companies Act.
Debt Recovery
63. Steps for reforming and strengthening debt recovery tribunals will be
taken. Additional tribunals will be established to speed up recovery.
Priority 5: Urban Development
Cities as Growth Hubs
64. Working with states, our government will facilitate development of
‘Cities as Growth Hubs’. This will be achieved through economic and transit
planning, and orderly development of peri-urban areas utilising town
planning schemes.
Creative redevelopment of cities
65. For creative brownfield redevelopment of existing cities with a
transformative impact, our government will formulate a framework for
enabling policies, market-based mechanisms and regulation.
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Transit Oriented Development
66. Transit Oriented Development plans for 14 large cities with a
population above 30 lakh will be formulated, along with an implementation
and financing strategy.
Urban Housing
67. Under the PM Awas Yojana Urban 2.0, housing needs of 1 crore urban
poor and middle-class families will be addressed with an investment of ₹ 10
lakh crore. This will include the central assistance of ₹ 2.2 lakh crore
in the next 5 years. A provision of interest subsidy to facilitate loans at
affordable rates is also envisaged.
68. In addition, enabling policies and regulations for efficient and
transparent rental housing markets with enhanced availability will also be put
in place.
Water Supply and Sanitation
69. In partnership with the State Governments and Multilateral
Development Banks we will promote water supply, sewage treatment and
solid waste management projects and services for 100 large cities through
bankable projects. These projects will also envisage use of treated water for
irrigation and filling up of tanks in nearby areas.
Street Markets
70. Building on the success of PM SVANidhi Scheme in transforming the
lives of street vendors, our Government envisions a scheme to support each
year, over the next five years, the development of 100 weekly ‘haats’ or
street food hubs in select cities.
Stamp Duty
71. We will encourage states which continue to charge high stamp duty to
moderate the rates for all, and also consider further lowering duties for
properties purchased by women. This reform will be made an essential
component of urban development schemes.
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Priority 6: Energy Security
Energy Transition
72. In the interim budget, I had announced our strategy to sustain high
and more resource-efficient economic growth, along with energy security in
terms of availability, accessibility and affordability. We will bring out a policy
document on appropriate energy transition pathways that balances the
imperatives of employment, growth and environmental sustainability.
PM Surya Ghar Muft Bijli Yojana
73. In line with the announcement in the interim budget, PM Surya Ghar
Muft Bijli Yojana has been launched to install rooftop solar plants to enable 1
crore households obtain free electricity up to 300 units every month. The
scheme has generated remarkable response with more than 1.28 crore
registrations and 14 lakh applications, and we will further encourage it.
Pumped Storage Policy
74. 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
75. Nuclear energy is expected to form a very significant part of the
energy mix for Viksit Bharat. Towards that pursuit, our government will
partner with the private sector for (1) setting up Bharat Small Reactors, (2)
research & development of Bharat Small Modular Reactor, and (3) research &
development of newer technologies for nuclear energy. The R&D funding
announced in the interim budget will be made available for this sector.
Advanced Ultra Super Critical Thermal Power Plants
76. The development of indigenous technology for Advanced Ultra Super
Critical (AUSC) thermal power plants with much higher efficiency has been
completed. A joint venture between NTPC and BHEL will set up a full scale
800 MW commercial plant using AUSC technology. The government will
provide the required fiscal support. Moving forward, development of
indigenous capacity for the production of high-grade steel and other
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advanced metallurgy materials for these plants will result in strong spin-off
benefits for the economy.
Roadmap for ‘hard to abate’ industries
77. A roadmap for moving the ‘hard to abate’ industries from ‘energy
efficiency’ targets to ‘emission targets’ will be formulated. Appropriate
regulations for transition of these industries from the current ‘Perform,
Achieve and Trade’ mode to ‘Indian Carbon Market’ mode will be put in
place.
Support to traditional micro and small industries
78. An investment-grade energy audit of traditional micro and small
industries in 60 clusters, including brass and ceramic, will be facilitated.
Financial support will be provided for shifting them to cleaner forms of
energy and implementation of energy efficiency measures. The scheme will
be replicated in another 100 clusters in the next phase.
Priority 7: Infrastructure
Infrastructure investment by Central Government
79. Significant investment the Central Government has made over the years
in building and improving infrastructure has had a strong multiplier effect on the
economy. We will endeavour to maintain strong fiscal support for infrastructure
over the next 5 years, in conjunction with imperatives of other priorities and
fiscal consolidation. This year, I have provided ` 11,11,111 crore for capital
expenditure. This would be 3.4 per cent of our GDP.
Infrastructure investment by state governments
80. We will encourage states to provide support of similar scale for
infrastructure, subject to their development priorities. A provision of ` 1.5
lakh crore for long-term interest free loans has been made this year also to
support the states in their resource allocation.
Private investment in infrastructure
81. Investment in infrastructure by private sector will be promoted
through viability gap funding and enabling policies and regulations. A marketbased financing framework will be brought out.
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Pradhan Mantri Gram Sadak Yojana (PMGSY)
82. Phase IV of PMGSY will be launched to provide all-weather
connectivity to 25,000 rural habitations which have become eligible in view
of their population increase.
Irrigation and Flood Mitigation
83. Bihar has frequently suffered from floods, many of them originating
outside the country. Plans to build flood control structures in Nepal are yet
to progress. Our government, through the Accelerated Irrigation Benefit
Programme and other sources, will provide financial support for projects with
estimated cost of ` 11,500 crore such as the Kosi-Mechi intra-state link and
20 other ongoing and new schemes including barrages, river pollution
abatement and irrigation projects. In addition, survey and investigation of
Kosi related flood mitigation and irrigation projects will be undertaken.
84. Assam grapples with floods every year by the Brahmaputra River and
its tributaries, originating outside India. We will provide assistance to Assam
for flood management and related projects.
85. Himachal Pradesh suffered extensive losses due to floods last year.
Our government will provide assistance to the state for reconstruction and
rehabilitation through multilateral development assistance.
86. Uttarakhand too suffered losses due to cloud bursts and massive
landslides. We will provide assistance to the state.
87. Recently Sikkim witnessed devastating flash floods and landslides that
wreaked havoc across the state. Our Government will provide assistance to
the state.
Tourism
88. Tourism has always been a part of our civilization. Our efforts in
positioning India as a global tourist destination will also create jobs, stimulate
investments and unlock economic opportunities for other sectors. In addition
to the measures outlined in the interim budget, I propose the following
measures.
89. Vishnupad Temple at Gaya and Mahabodhi Temple at Bodh Gaya in
Bihar are of immense spiritual significance. Comprehensive development of
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Vishnupad Temple Corridor and Mahabodhi Temple Corridor will be
supported, modelled on the successful Kashi Vishwanath Temple Corridor, to
transform them into world class pilgrim and tourist destinations.
90. Rajgir holds immense religious significance for Hindus, Buddhists and
Jains. The 20th Tirthankara Munisuvrata temple in the Jain Temple complex
is ancient. The Saptharishi or the 7 hotsprings form a warm water
Brahmakund that is sacred. A comprehensive development initiative for
Rajgir will be undertaken.
91. Our government will support the development of Nalanda as a tourist
centre besides reviving Nalanda University to its glorious stature.
92. Odisha’s scenic beauty, temples, monuments, craftsmanship, wildlife
sanctuaries, natural landscapes and pristine beaches make it an ultimate
tourism destination. Our government will provide assistance for their
development.
Priority 8: Innovation, Research & Development
93. We will operationalize the Anusandhan National Research Fund for
basic research and prototype development. Further, we will set up a
mechanism for spurring private sector-driven research and innovation at
commercial scale with a financing pool of ` 1 lakh crore in line with the
announcement in the interim budget.
Space Economy
94. With our continued emphasis on expanding the space economy by 5
times in the next 10 years, a venture capital fund of ` 1,000 crore will be set
up.
Priority 9: Next Generation Reforms
Economic Policy Framework
95. We will formulate an Economic Policy Framework to delineate the
overarching approach to economic development and set the scope of the
next generation of reforms for facilitating employment opportunities and
sustaining high growth.
96. Our government will initiate and incentivize reforms for (1) improving
productivity of factors of production, and (2) facilitating markets and sectors
to become more efficient. These reforms will cover all factors of production,
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namely land, labour, capital and entrepreneurship, and technology as an
enabler of improving total factor productivity and bridging inequality.
97. Effective implementation of several of these reforms requires
collaboration between the Centre and the states and building consensus, as
development of the country lies in development of the states. For promoting
competitive federalism and incentivizing states for faster implementation of
reforms, I propose to earmark a significant part of the 50-year interest-free
loan. Working with the states, we will initiate the following reforms.
Land-related reforms by state governments
98. 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. These will be incentivized for
completion within the next 3 years through appropriate fiscal support.
Rural Land related actions
99. Rural land related actions will include (1) assignment of Unique Land
Parcel Identification Number (ULPIN) or Bhu-Aadhaar for all lands, (2)
digitization of cadastral maps, (3) survey of map sub-divisions as per current
ownership, (4) establishment of land registry, and (5) linking to the farmers
registry. These actions will also facilitate credit flow and other agricultural
services.
Urban Land related actions
100. Land records in urban areas will be digitized with GIS mapping. An IT
based system for property record administration, updating, and tax
administration will be established. These will also facilitate improving the
financial position of urban local bodies.
Labour related reforms
Services to Labour
101. Our government will facilitate the provision of a wide array of services
to labour, including those for employment and skilling. A comprehensive
integration of e-shram portal with other portals will facilitate such one-stop
solution. Open architecture databases for the rapidly changing labour
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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 Portal
102. 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
103. For meeting financing needs of the economy, our government will
bring out a financial sector vision and strategy document to prepare the
sector in terms of size, capacity and skills. This will set the agenda for the
next 5 years and guide the work of the government, regulators, financial
institutions and market participants.
Taxonomy for climate finance
104. We will develop a taxonomy for climate finance for enhancing the
availability of capital for climate adaptation and mitigation. This will support
achievement of the country’s climate commitments and green transition.
Variable Capital Company structure
105. We will seek the required legislative approval for providing an
efficient and flexible mode for financing leasing of aircrafts and ships, and
pooled funds of private equity through a ‘variable company structure’.
Foreign Direct Investment and Overseas Investment
106. The rules and regulations for Foreign Direct Investment and Overseas
Investments will be simplified to (1) facilitate foreign direct investments, (2)
nudge prioritization, and (3) promote opportunities for using Indian Rupee as
a currency for overseas investments.
NPS Vatsalya
107. NPS-Vatsalya, a plan for contribution by parents and guardians for
minors will be started. On attaining the age of majority, the plan can be
converted seamlessly into a normal NPS account.
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Use of Technology
108. We have successfully used technology for improving productivity and
bridging inequality in our economy during the past 10 years. 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. We will step up
adoption of technology towards digitalization of the economy.
Ease of Doing Business
109. For enhancing ‘Ease of Doing Business’, we are already working on the
Jan Vishwas Bill 2.0. Further, states will be incentivized for implementation of
their Business Reforms Action Plans and digitalization.
Data and Statistics
110. 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 utilized with active
use of technology tools.
New Pension Scheme (NPS)
111. The Committee to review the NPS has made considerable progress in
its work. I am happy that the Staff Side of the National Council of the Joint
Consultative Machinery for Central Government Employees have taken a
constructive approach. A solution will be evolved which addresses the
relevant issues while maintaining fiscal prudence to protect the common
citizens.
Budget Estimates 2024-25
112. For the year 2024-25, the total receipts other than borrowings and
the total expenditure are estimated at ` 32.07 lakh crore and ` 48.21 lakh
crore respectively. The net tax receipts are estimated at ` 25.83 lakh crore.
The fiscal deficit is estimated at 4.9 per cent of GDP.
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113. The gross and net market borrowings through dated securities during
2024-25 are estimated at ` 14.01 lakh crore and ` 11.63 lakh crore
respectively. Both will be less than that in 2023-24.
114. The fiscal consolidation path announced by me in 2021 has served our
economy very well, and we aim to reach a deficit below 4.5 per cent next
year. The Government is committed to staying the course. From 2026-27
onwards, our endeavour will be to keep the fiscal deficit each year such that
the Central Government debt will be on a declining path as percentage of
GDP.
I will, now, move to Part B.
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PART B
Indirect Taxes
115. I start with GST. It has decreased tax incidence on the common man;
reduced compliance burden and logistics cost for trade and industry; and
enhanced revenues of the central and state governments. It is a success of
vast proportions. To multiply the benefits of GST, we will strive to further
simplify and rationalise the tax structure and endeavour to expand it to the
remaining sectors.
116. My proposals for customs duties intend to support domestic
manufacturing, deepen local value addition, promote export
competitiveness, and simplify taxation, while keeping the interest of the
general public and consumers surmount.
117. In Budget 2022-23, we reduced the number of customs duty rates.
I propose to undertake a comprehensive review of the rate structure over the
next six months to rationalise and simplify it for ease of trade, removal of
duty inversion and reduction of disputes.
118. I shall now take up sector specific customs duty proposals.
Medicines and Medical Equipment
119. To provide relief to cancer patients, I propose to fully exempt three
more medicines from customs duties.
120. I also propose changes in the BCD on x-ray tubes & flat panel
detectors for use in medical x-ray machines under the Phased Manufacturing
Programme, so as to synchronise them with domestic capacity addition.
Mobile Phone and Related Parts
121. With a three-fold increase in domestic production and almost
100-fold jump in exports of mobile phones over the last six years, the Indian
mobile phone industry has matured. In the interest of consumers, I now
propose to reduce the BCD on mobile phone, mobile PCBA and mobile
charger to 15 per cent.
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Critical Minerals
122. Minerals such as lithium, copper, cobalt and rare earth elements are
critical for sectors like nuclear energy, renewable energy, space, defence,
telecommunications, and high-tech electronics. I propose to fully exempt
customs duties on 25 critical minerals and reduce BCD on two of them. This
will provide a major fillip to the processing and refining of such minerals and
help secure their availability for these strategic and important sectors.
Solar Energy
123. Energy transition is critical in the fight against climate change. To
support energy transition, I propose to expand the list of exempted capital
goods for use in the manufacture of solar cells and panels in the country.
Further, in view of sufficient domestic manufacturing capacity of solar glass
and tinned copper interconnect, I propose not to extend the exemption of
customs duties provided to them.
Marine products
124. India’s seafood exports in the last financial year touched an all-time
high of more than ₹ 60,000 crore. Frozen shrimp accounted for about
two-thirds of these exports. To enhance their competitiveness, I propose to
reduce BCD on certain broodstock, polychaete worms, shrimp and fish feed
to 5 per cent. I also propose to exempt customs duty on various inputs for
manufacture of shrimp and fish feed.
Leather and Textile
125. Similarly, to enhance the competitiveness of exports in the leather
and textile sectors, I propose to reduce BCD on real down filling material
from duck or goose. I am also making additions to the list of exempted goods
for manufacture of leather and textile garments, footwear and other leather
articles for export.
126. To rectify inversion in duty, I propose to reduce BCD, subject to
conditions, on methylene diphenyl diisocyanate (MDI) for manufacture of
spandex yarn from 7.5 to 5 per cent.
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127. Furthermore, the export duty structure on raw hides, skins and
leather is proposed to be simplified and rationalized.
Precious Metals
128. To enhance domestic value addition in gold and precious metal
jewellery in the country, I propose to reduce customs duties on gold and
silver to 6 per cent and that on platinum to 6.4 per cent.
Other Metals
129. Steel and copper are important raw materials. To reduce their cost of
production, I propose to remove the BCD on ferro nickel and blister copper. I
am also continuing with nil BCD on ferrous scrap and nickel cathode and
concessional BCD of 2.5 per cent on copper scrap.
Electronics
130. To increase value addition in the domestic electronics industry,
I propose to remove the BCD, subject to conditions, on oxygen free copper
for manufacture of resistors. I also propose to exempt certain parts for
manufacture of connectors.
Chemicals and Petrochemicals
131. To support existing and new capacities in the pipeline, I propose to
increase the BCD on ammonium nitrate from 7.5 to 10 per cent.
Plastics
132. PVC flex banners are non-biodegradable and hazardous for
environment and health. To curb their imports, I propose to raise the BCD on
them from 10 to 25 per cent.
Telecommunication Equipment
133. To incentivise domestic manufacturing, I propose to increase the BCD
from 10 to 15 per cent on PCBA of specified telecom equipment.
Trade facilitation
134. To promote domestic aviation and boat & ship MRO, I propose to
extend the period for export of goods imported for repairs from six months
to one year. In the same vein, I propose to extend the time-limit for re-import
of goods for repairs under warranty from three to five years.
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Direct Taxes
135. We will continue our efforts to simplify taxes, improve tax payer
services, provide tax certainty and reduce litigation while enhancing revenues
for funding the development and welfare schemes of the government.
136. It has been our endeavour to simplify taxation. We have taken a
number of measures in the last few years including introduction of simplified
tax regimes without exemptions and deductions for corporate tax and
personal income tax. This has been appreciated by tax payers. 58 per cent of
corporate tax came from the simplified tax regime in financial year 2022-23.
Similarly, as per data available till now for the last fiscal, more than twothirds have availed the new personal income tax regime.
Comprehensive Review of the Income-tax Act, 1961
137. I am now announcing a comprehensive review of the Income-tax Act,
1961. The purpose is to make the Act concise, lucid, easy to read and
understand. This will reduce disputes and litigation, thereby providing tax
certainty to the tax payers. It will also bring down the demand embroiled in
litigation. It is proposed to be completed in six months.
138. A beginning is being made in the Finance Bill by simplifying the tax
regime for charities, TDS rate structure, provisions for reassessment and
search provisions and capital gains taxation.
Simplification for Charities and of TDS
139. The two tax exemption regimes for charities are proposed to be
merged into one. The 5 per cent TDS rate on many payments is being merged
into the 2 per cent TDS rate and the 20 per cent TDS rate on repurchase of
units by mutual funds or UTI is being withdrawn. TDS rate on e-commerce
operators is proposed to be reduced from one to 0.1 per cent. Moreover,
credit of TCS is proposed to be given in the TDS to be deducted on salary.
Further, I propose to decriminalize delay for payment of TDS up to the due
date of filing statement for the same. I also plan to provide a standard
operating procedure for TDS defaults and simplify and rationalise the
compounding guidelines for such defaults.
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Simplification of Reassessment
140. I propose to thoroughly simplify the provisions for reopening and
reassessment. An assessment hereinafter can be reopened beyond three
years from the end of the assessment year only if the escaped income is
₹ 50 lakh or more, up to a maximum period of five years from the end of the
assessment year. Even in search cases, a time limit of six years before the
year of search, as against the existing time limit of ten years, is proposed.
This will reduce tax-uncertainty and disputes.
Simplification and Rationalisation of Capital Gains
141. Capital gains taxation is also proposed to be hugely simplified.
142. Short term gains on certain financial assets shall henceforth attract a
tax rate of 20 per cent, while that on all other financial assets and all
non-financial assets shall continue to attract the applicable tax rate.
143. Long term gains on all financial and non-financial assets, on the other
hand, will attract a tax rate of 12.5 per cent. For the benefit of the lower and
middle-income classes, I propose to increase the limit of exemption of capital
gains on certain financial assets to ₹ 1.25 lakh per year.
144. Listed financial assets held for more than a year will be classified as
long term, while unlisted financial assets and all non-financial assets will have
to be held for at least two years to be classified as long-term.
145. Unlisted bonds and debentures, debt mutual funds and market linked
debentures, irrespective of holding period, however, will attract tax on
capital gains at applicable rates.
Tax Payer Services
146. All the major tax payer services under GST and most services under
Customs and Income Tax have been digitalised. All remaining services of
Customs and Income Tax including rectification and order giving effect to
appellate orders shall be digitalized and made paper-less over the next two
years.
Litigation and Appeals
147. While our concerted efforts to reduce pendency of appeals at various
appellate fora are beginning to show good results, it will continue to engage
our highest attention.
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148. To dispose of the backlog of first appeals, I plan to deploy more
officers to hear and decide such appeals, especially those with large tax
effect.
149. For resolution of certain income tax disputes pending in appeal, I am
also proposing Vivad Se Vishwas Scheme, 2024.
150. Further, I propose to increase monetary limits for filing appeals
related to direct taxes, excise and service tax in the Tax Tribunals, High Courts
and Supreme Court to ₹ 60 lakh, ₹ 2 crore and ₹ 5 crore respectively.
151. With a view to reduce litigation and provide certainty in international
taxation, we will expand the scope of safe harbour rules and make them
more attractive. We will also streamline the transfer pricing assessment
procedure.
Employment and Investment
152. I have a few proposals to promote investment and foster
employment.
153. First of all, to bolster the Indian start-up eco-system, boost the
entrepreneurial spirit and support innovation, I propose to abolish the socalled angel tax for all classes of investors.
154. Second, there is tremendous potential for cruise tourism in India. To
give a fillip to this employment generating industry, I am proposing a simpler
tax regime for foreign shipping companies operating domestic cruises in the
country.
155. Third, India is a world leader in the diamond cutting and polishing
industry, which employs a large number of skilled workers. To further
promote the development of this sector, we would provide for safe harbour
rates for foreign mining companies selling raw diamonds in the country.
156. Fourth, to attract foreign capital for our development needs,
I propose to reduce the corporate tax rate on foreign companies from 40 to
35 per cent.
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Deepening the tax base
157. I have a couple of proposals for deepening the tax base. First, Security
Transactions Tax on futures and options of securities is proposed to be
increased to 0.02 per cent and 0.1 per cent respectively. Second, for reasons
of equity, I propose to tax income received on buy back of shares in the
hands of the recipient.
Others
158. To improve social security benefits, deduction of expenditure by
employers towards NPS is proposed to be increased from 10 to 14 per cent of
the employee’s salary. Similarly, deduction of this expenditure up to 14 per
cent of salary from the income of employees in private sector, public sector
banks and undertakings, opting for the new tax regime, is proposed to be
provided.
159. Indian professionals working in multinationals get ESOPs and invest in
social security schemes and other movable assets abroad. Non-reporting of
such small foreign assets has penal consequences under the Black Money
Act. Such non-reporting of movable assets up to ₹ 20 lakh is proposed to be
de-penalised.
160. Other major proposals in the Finance Bill relate to:
• Withdrawal of equalization levy of 2 per cent;
• Expansion of tax benefits to certain funds and entities in IFSCs; and
• immunity from penalty and prosecution to benamidar on full and
true disclosure so as to improve conviction under the Benami
Transactions (Prohibition) Act, 1988.
Personal Income Tax
161. Coming to Personal Income Tax Rates, I have two announcements to
make for those opting for the new tax regime. First, the standard deduction
for salaried employees is proposed to be increased from ₹50,000/- to
₹75,000/-. Similarly, deduction on family pension for pensioners is proposed
to be enhanced from ₹ 15,000/- to ₹ 25,000/-. This will provide relief to
about four crore salaried individuals and pensioners.
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162. Second, in the new tax regime, the tax rate structure is proposed to
be revised, as follows:
0-3 lakh rupees Nil
3-7 lakh rupees 5 per cent
7-10 lakh rupees 10 per cent
10-12 lakh rupees 15 per cent
12-15 lakh rupees 20 per cent
Above 15 lakh rupees 30 per cent
As a result of these changes, a salaried employee in the new tax regime
stands to save up to ₹ 17,500/- in income tax.
163. Apart from these, I am also making some other changes as given in
the annexure.
164. As a result of these proposals, revenue of about ₹ 37,000 crore –
₹ 29,000 crore in direct taxes and ₹ 8,000 crore in indirect taxes – will be
forgone while revenue of about ₹ 30,000 crore rupees will be additionally
mobilized. Thus, the total revenue forgone is about ₹ 7,000 crore annually.
165. Mr. Speaker Sir, with this, I commend the budget to this august
House.
Jai Hind.
