On 5th February 2025, Finance Minister Nirmala Sitharaman presented the Union Budget for 2025-26, positioning it as a vision document for a developed India by 2047. The budget emphasizes agriculture, MSMEs, exports, and investments as the primary engines of growth.
Agriculture: The First Engine of Growth
As a country heavily reliant on agriculture, India’s budget underscores the importance of this sector. Union Minister S.P. Singh Baghel highlighted that over 50% of India’s population depends on agriculture, making it a critical sector for the nation’s prosperity. The budget introduced several measures to support farmers, including increasing the limit of the Kisan Credit Card from ₹3 lakh to ₹5 lakh, which will benefit around 7.7 crore farmers. Additionally, initiatives aimed at rural prosperity and stability were announced, focusing on creating new employment opportunities for women and youth in rural areas through technical training and skill development.
Fisheries: Boosting Exports and Rural Income
The fisheries sector received significant attention, with an increase in allocation to boost production and exports. India, which is the second-largest exporter of fish, aims to further enhance its capabilities. Minister Baghel noted the importance of fisheries in increasing rural income and contributing to the GDP. The budget also included measures to reduce import duties on fish hydrolites and frozen fish paste, benefiting fish producers.
MSMEs: The Second Engine of Growth
Micro, Small, and Medium Enterprises (MSMEs) play a vital role in India’s economy, contributing around 30% to the GDP. The budget allocated an additional ₹9000 crore to the Credit Guarantee Scheme for MSMEs, which will make an additional ₹2 lakh crore available for small businesses. This support aims to enhance the production capacity and efficiency of MSMEs, with a target growth rate of 30% in the next five years.
Tax Relief for the Middle Class
One of the significant highlights of the budget was the increase in the income tax exemption limit from ₹7 lakh to ₹12 lakh. This move is expected to provide substantial relief to the middle class, enabling them to have a better standard of living and encouraging spending in the economy.
Export and Infrastructure Development
Exports remain a cornerstone of India’s economic growth strategy. The budget introduced policies to facilitate exporters and improve logistics and infrastructure, aiming to reach a $5 trillion economy by 2030. Additionally, there is a strong focus on infrastructure development, with investments in roads, railways, airports, and energy projects. The goal is to increase the infrastructure growth rate to 12% by 2030, which is critical for the nation’s progress.
Inclusive Growth and Empowerment
The budget also emphasizes inclusive growth, with special attention to women’s education, healthcare, and employment. Programs such as “Beti Bachao Beti Padhao” have been instrumental in improving the gender ratio and empowering women.
In summary, the 2025-26 Union Budget lays down a comprehensive roadmap for India’s development, balancing immediate welfare measures with long-term growth strategies. With a vision for a developed India by 2047, the budget is set to transform the nation’s economic landscape.
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