Summary of Union Budget 2025-26 (I)

1. Macroeconomic Overview

  • GDP Growth Target: Projected at 7.5% for FY 2025-26, indicating a strong post-pandemic recovery.

  • Fiscal Deficit: Estimated at 4.4% of GDP, aligning with long-term fiscal consolidation goals.

  • Disinvestment Target: ₹1.1 lakh crore set for privatization of public sector enterprises.

  • Inflation Management: Measures include strengthening food supply chains and rationalizing import duties.

2. Taxation Reforms

Direct Taxes

  • Personal Income Tax Changes:

    • Basic exemption limit increased to ₹3.5 lakh.

    • Standard deduction raised to ₹75,000 for salaried individuals.

  • Corporate Tax:

    • Maintained at 22% for domestic companies.

    • 15% concessional tax rate for new manufacturing companies extended by one year.

  • Incentives for Startups:

    • Tax holiday for startups extended till 2027.

    • Capital gains exemptions increased for startup investments.

Indirect Taxes

  • GST Reforms:

    • Simplification of GST compliance norms.

    • Uniform tax rates across various sectors.

  • Customs Duty Rationalization:

    • Reduction on raw materials for key industries.

    • Higher duties on non-essential luxury imports.

3. Infrastructure Development

  • Investment in National Infrastructure Pipeline (NIP): ₹100 lakh crore allocated for roads, railways, ports, and urban development.

  • Railway Modernization: ₹2.4 lakh crore allocated for new high-speed trains, electrification, and safety measures.

  • Smart Cities & Urban Transformation: Increased funds for housing, public transport, and waste management.

  • PM Gati Shakti Plan: Enhancing logistics and connectivity for industrial corridors.

4. Agriculture & Rural Development

  • PM-KISAN Scheme Expansion: Increased direct benefit transfer to ₹8,000 per year.

  • Agricultural Credit: ₹20 lakh crore allocated for farmers through Kisan Credit Cards (KCC).

  • MSP (Minimum Support Price) Hike: Ensuring better income security for farmers.

  • Irrigation & Water Conservation: ₹15,000 crore allocated for PM Krishi Sinchayee Yojana.

  • FPO (Farmer Producer Organizations) Promotion: Special financial aid for 10,000 FPOs to strengthen the agri-supply chain.

5. Social Welfare & Employment Generation

  • MGNREGA Allocation: ₹1 lakh crore for rural employment.

  • Skill India & Employment Schemes: Expansion of vocational training programs.

  • Affordable Housing: ₹50,000 crore for Pradhan Mantri Awas Yojana.

  • Health Sector Boost:

    • ₹80,000 crore for Ayushman Bharat expansion.

    • Strengthening of primary healthcare centers in rural areas.

6. Education & Research

  • National Education Policy (NEP) Implementation: Increased budget for school and higher education.

  • PM Research Fellowships: ₹7,000 crore allocated for research in science and technology.

  • Digital University & Online Learning: Strengthening of e-learning platforms and digital literacy programs.

7. Technology & Digital Economy

  • 5G Network Expansion: Incentives for telecom firms to accelerate rollout.

  • Artificial Intelligence & Robotics: ₹10,000 crore allocated for AI-driven innovations.

  • Crypto & Digital Asset Regulation: Clear tax framework introduced.

  • Cybersecurity Initiatives: Strengthening of digital security infrastructure.

8. Environmental & Green Initiatives

  • Renewable Energy Investment: ₹20,000 crore for solar, wind, and green hydrogen projects.

  • Electric Vehicles (EVs) Boost: Incentives for EV manufacturing and charging infrastructure.

  • Water Conservation & Clean Ganga Mission: Increased funding for sustainable water management.

  • Carbon Credits & ESG Initiatives: New market framework for carbon trading.

Conclusion

The Union Budget 2025-26 focuses on sustainable economic growth, infrastructure, employment, and digital innovation. It balances fiscal discipline with developmental goals, making it a crucial topic for UPSC aspirants. This summary provides a structured approach to understanding budgetary allocations, policies, and their implications on governance and national progress.

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