Highlights of Union Budget 2025-26

The Union Budget 2025-26 outlines big plans for India’s growth, focusing on key sectors like Agriculture, MSMEs, Investments, Exports, and Taxation. These initiatives aim to ensure steady growth and opportunities for everyone. The budget highlights show a vision for India’s transformative development.

Agriculture:

The First Engine of Growth Agriculture continues to be the backbone of India’s development. The government has introduced several steps to strengthen this sector:

• Kisan Credit Card Limit Increased: The limit has been raised from Rs. 3 lakh to Rs. 5 lakh, giving farmers better financial support.
• Jal Jeevan Mission Extended: This mission will continue until 2028, ensuring farmers have better access to clean and sustainable water sources.

MSMEs:

The Second Engine of Growth Micro, Small, and Medium Enterprises (MSMEs) play a vital role in India’s economy. The following steps will support their growth:

• Social Welfare Scheme for Gig Workers: This scheme will offer social security benefits to gig and platform workers in the MSME sector.
• Investment in Infrastructure: Additional infrastructure will be provided to 5 IITs established after 2014, with IIT Patna undergoing expansion. This will help in skill development, indirectly benefiting MSMEs.
• Private Sector R&D: The government has allocated Rs. 20,000 crores to promote research and development in the private sector, boosting innovation where MSMEs play a key role.

Investment:

The Third Engine of Growth Investment is crucial for the country’s sustainable growth. The government has introduced measures to attract and support investments:

• Increased FDI in Insurance: The Foreign Direct Investment (FDI) limit in the insurance sector has been raised to 100% if the entire premium is invested in India.
• Urban Challenge Fund: A Rs. 1 lakh crore fund has been set up to address urban challenges, improve infrastructure, and promote growth in cities across the country.

Exports:

The Fourth Engine of Growth India’s export sector will benefit from several strategic changes:

• Development of Top 50 Tourist Spots: The government will develop the top 50 tourist destinations, focusing on Buddhist heritage sites. This will boost tourism and increase export earnings from international travel.
• Promotion of ‘Heal in India’: This program aims to attract international patients for healthcare, strengthening India’s position as a hub for medical tourism.

Direct Tax Reforms:

The Union Budget 2025-26 introduces major reforms in direct taxes to simplify compliance and offer relief to the middle class:

• New Income Tax Bill: A new bill focusing on simplicity will be introduced in Parliament next week.
• Relief for Middle-Class Taxpayers: Major changes in personal income tax.
• No Income Tax up to Rs. 12 lakh: This will benefit millions of middle-class taxpayers.
• Adjusted Income Tax Slabs: Tax slabs have been revised for a fairer distribution of the tax burden.
• Simplified TDS: Tax Deducted at Source (TDS) and Tax Collected at Source (TCS) provisions have been simplified.
• Higher TDS Limit on Rent: The TDS limit on rent has been increased from Rs. 2.4 lakh to Rs. 6 lakh, offering relief to landlords and tenants.
• Increased TDS Limit for Seniors: The TDS limit for senior citizens has been raised from Rs. 50,000 to Rs. 1 lakh.

Indirect Tax Reforms

The budget also brings several changes in indirect taxes to support businesses and streamline tariffs:

• Simplified Customs Tariffs: The customs tariff structure has been simplified to make doing business easier and imports more efficient.
• Duty Exemption on Life-Saving Drugs: Customs duties have been waived on 36 life-saving drugs, while a 5% duty will be applied to six other important medicines.
• General Announcements In addition to sector-specific announcements, the government has made several general improvements in infrastructure, innovation, and social welfare:
• More Medical College Seats: The government will add 10,000 new medical college seats this year and plans to add 75,000 seats over the next five years, producing more qualified medical professionals.
• Centre for Excellence in AI: Rs. 500 crores have been allocated to establish a Centre for Excellence in Artificial Intelligence to promote innovation and technology.
• Greenfield Airports in Bihar: New airports will be built in Bihar, improving travel infrastructure beyond major cities like Patna.
• New KYC Registry: A revamped Know Your Customer (KYC) registry will be launched to improve transparency and reduce financial fraud.

Conclusion: The Union Budget 2025-26 sets out a clear and ambitious roadmap for India’s economic development, focusing on key areas like agriculture, MSMEs, investment, exports, and taxation. The government’s efforts aim to create sustainable growth, improve infrastructure, support the middle class, and promote innovation while keeping social welfare and inclusivity in mind.