Interim Budget 2024: Key Features & Highlights

On February 1 as customary, the finance minister of India, Smt Nirmala Sitaraman announced the Interim budget for 2024-2025. 

The interim budget is presented during the election year instead of a full budget as there may be a change in the executive power after the polls. The new government will present the new budget via votes on account provision.

The Budget presented provides an overview of the direction the government wishes to take, details the growth targets, and major focus areas for the upcoming year. The announced interim budget was mostly along the lines of expectations, except for a few surprises. 

Here is a brief look at the budget. 

Budget 2024

The budget is organized in two parts – Part A & Part B.

Part A consists of an abstract of all receipt types, as well as their breakdowns and explanatory notes. 

There are statements for tax, non-tax revenue, and capital receipts (both debt and non-debt). The statements provide States with assistance in planning their finances and managing their cash flow.

Part B contains statements of various types of assets and liabilities, which present the government’s overall financial position. 

Statements on Annuity Projects, Non-Tax Revenue Arrears, Unrealized Tax Revenue, Assets, and Guarantees are included following the FRBM Rules of 2004. These statements are prepared based on input from Ministries/Departments.

Key Features Of Interim Budget 2024-25

Taxes

The interim budget didn’t propose any changes to the tax structure. The previous tax rates were retained for direct and indirect taxes, including import duties. 

However, the withdrawal of Outstanding direct tax demands was presented. 

This allows relaxation on several petty, non-verified, and disputed tax demands of up to Rs. 25000 until the financial year 2009-10 and up to Rs. 10,000 for FY 2010-11 to 2014-15. It is set to benefit up to 1 crore taxpayers. 

Tax benefits for startups, investments made by sovereign wealth funds, and pension funds will be extended until March 2025

Focus On Technology

A 1 lakh crore corpus loan with a 50-year interest-free period was announced to encourage tech-savvy youth fulfill to their entrepreneurial aspirations. 

This loan will be provided for long-term financing or refinancing for long tenures at low or no interest rates. 

The finance minister believes this proposal will scale up innovation and research, and usher in a golden era for the country’s youth. 

Defence-related deep-tech technologies will be enhanced through a new scheme.

Infrastructure

The FM announced that the capital expenditure outlay for Infrastructure development and employment generation is being increased by 11.1 % to Rs.11,11,111 crore(3.4% of the GDP) while keeping the fiscal deficit under control. 

For railways, three major railway corridors will be enforced under PM Gati Shakti. They are energy, mineral, and cement corridors, port connectivity corridors, and high-traffic density corridors. 

An additional 40,000 normal railway bogies will be upgraded to Vande Bharat standards to improve the safety, and comfort of the passengers.

Health

To fight the rising cases of cervical cancer in the country, the government is promoting early HPV vaccination for girls in the age group of 9 – 14 years. 

A plan to establish more medical colleges using the current hospital infrastructure was also put forward. 

The various maternal and child health care schemes will be combined into a single comprehensive program for easy governance and monitoring. 

Additionally, a newly designed U-Win platform for immunization management, as well as increased Mission Indradhanush efforts, are set to be implemented soon. 

Similarly, All ASHA workers, Anganwadi workers, and helpers will benefit from healthcare coverage under the Ayushman Bharat scheme.

Housing  & Solarization Projects

The Pradhan Mantri Awas Yojana(Grameen), launched to provide housing for all, is close to achieving the target of three crore houses. 

An additional 2 crore houses will be set up in the coming 5 years to accommodate the growing population. 

The efforts to provide free electricity will be achieved through through rooftop solarization. The scheme aims to provide free electricity for up to 300 units to over one crore households every month. This will help each household to save Rs.15,000 to Rs.18,000 annually.

Sustainable Growth

The budget promoted the government’s commitment to green energy and sustainable development by setting up of Coal gasification and liquefaction capacity of 100 MT by 2030. 

This move will reduce India’s dependence on importing natural gas and other chemicals, and enhance self-sufficiency as well as carry forward the objective of Aatmanirbhar Bharat. 

Tourism

Under the tourism sector, the budget drew focus on the development of iconic tourist attractions. 

Several projects to improve port connectivity, tourism infrastructure, and amenities in tourist places, including Lakshadweep will be taken up in the upcoming years. 

The FM urged the states to take up the development tourism framework and announced long-term interest-free loans to encourage upscaling the branding at a global scale and promote opportunities for local entrepreneurship.

Other Important Highlights

• The government plans to focus on the needs, aspirations, and welfare of four major castes, i.e.,  ‘Garib’ (Poor), ‘Mahilayen’ (Women), ‘Yuva’ (Youth), and  ‘Annadata’(Farmer)
• The gross and net market borrowings through dated securities in 2024-25 are estimated to be Rs 14.13 and 11.75 lakh crore, respectively, and will be lower than in 2023-24
• Efforts will be made by the government to transform the eastern region into a powerful force for growth in India
• The Finance Minister Smt. Nirmala Sitaraman said FDI now means ‘First Develop India’ and bilateral trade treaties will be used to promote FDIs

For a detailed analysis of the interim budget 2024-25, please refer to this PDF!

What Is Viksit Bharat?

Viksit Bharat, the keyword of the budget speech, is the PM’s vision to transform India into a developed nation by 2047. 

The Union Finance Minister Nirmala Sitharaman said the government’s vision for ‘Viksit Bharat’ is that of a “prosperous Bharat in harmony with nature, with modern infrastructure, and providing opportunities for all citizens and all regions to reach their potential”.

To make this vision a reality, a provision of 75,000 crore rupees as a fifty-year interest-free loan was proposed. This will aim to support the milestone-linked reforms of the PM’s vision of Viksit Bharat by the State Governments.

In addition, the government will establish a committee to thoroughly examine the difficulties brought on by rapid population expansion and shifting demographics. 

It will be the committee’s responsibility to offer suggestions on how to tackle these issues in a way that advances the objective of “Viksit Bharat.”

A detailed roadmap for ‘Viksit Bharat’ will be presented in the full budget in July, after the elections. 

Check out the Finance Minister’s full budget speech here!