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Budget FY 24-25: FM Sitharaman announces schemes for women, youth & farmers

Finance Minister Nirmala Sitharaman presented the Union Budget 2024-25, outlining nine priority areas for the Government, including agriculture, employment, social justice and infrastructure. This budget marks the first presented by the Government after its re-election in June 2024, and the seventh consecutive one presented by Sitharaman.

The budget announced a special focus on women and youth, with the allocation of Rs 3 trillion for schemes benefiting women and girls. Sitaraman also made major announcements for Bihar and Andhra Pradesh, including a boost in infrastructure and special financial support. Additionally, she announced the abolition of angel tax for all classes of investors in startups.

In her budget, the FM also announced a scheme to provide internship opportunities to 1 crore youth in 500 top companies over 5 years.

The Centre’s FY25 capex spend is seen at Rs 11.1 lakh crore, unchanged from the Interim Budget, with infrastructure spend at 3.4% of GDP. The budget also increased standard deduction from Rs 50,000 to Rs 75,000 and family pension deduction from Rs 15,000 to Rs 25,000.

Commenting on the budget, Nilesh Shah, Past President, Bombay Chamber & Group President & MD, Kotak Mahindra AMC, said, “Fiscal Prudence of 4.9% for FY 24 will pave the way for Rating upgrade. Support for employment generation will boost growth. Infrastructure investment at 3.4 % of GDP is elevated yet not crowding out others.”

Pinky Mehta, President, Bombay Chamber and Director, Aditya Birla Sun Life Insurance Co, said “The Union Budget 2024-25, with an allocation of Rs 1.48 lakh crore, prioritises education, employment, and skilling, demonstrating a strong commitment to empowering India’s youth. The Government’s nine focus areas outline a clear roadmap for a Viksit Bharat. Additionally, the removal of angel tax and increase in standard deduction limit are notable reforms, fostering a supportive environment for growth and innovation.”

Rajiv Anand, Sr. Vice President, Bombay Chamber & Deputy Managing Director, Axis Bank, added, “Fiscal prudence will bring down cost of capital for industry and will also help in a sovereign rating upgrade. The budget has focused on most of the key issues; agricultural productivity, growth in MSME, employment and energy transition. Resources have been allocated from capital gains to fund removal of angel tax and reduction of income tax, a welcome relief for the middle class.”

The budget aims to support employment generation, infrastructure development, and innovation, while maintaining fiscal prudence.

Key Highlights:

• Angel Tax abolished for all categories of investors
• STT on F&O increased to 0.2%
• FM keeps capex at Rs 11.11 lakh crore or 3.4% of GDP
• Rs 11.11 lakh crore allocated towards capital expenditure. This would account for 3.4% of the GDP.
• Fiscal deficit lowered to 4.9% of GDP, market borrowing unchanged at Rs 14.13 lakh crore.
• Fiscal deficit for FY25 further scaled down to 4.9 from 5.1% in interim Budget.
• Aim to reach a fiscal deficit of below 4.5% by FY26.
• BCD on mobile phones, chargers reduced to 15%.
• Highest Capex Spending proposed to support the economy and job creation.
• Govt allocates over Rs 3 lakh crore for schemes benefiting women, girls.
• Short-term gains tax on specified financial assets increased from 15% to 20%.
• Long-term gains tax on all assets raised to 12.5% from earlier 10%.
• Social and infrastructure funds announced for Andhra Pradesh, with a backward region grant for three districts.
• Package for Vizag-Chennai industrial corridor.
• Rs 15,000 crore financial assistance for Amaravati’s development with promises for future funding.
• Rs 26,000 crore for roads and expressways in Bihar.
• Funds allocated for temple development in Bihar and Odisha.
• Rs 8,000 crore allocated for Atal Mission for Rejuvenation and Urban Transformation.