Exploring Last Year's Budget Highlights and Anticipating Key Changes for 2024-25

Highlights

Interim Budget Unveiled: As the government approaches a general election, Finance Minister Nirmala Sitharaman presents the 'interim' budget for 2024-25, with the complete budget anticipated in July.
Tax Adjustments and Slab Revisions: Last year's budget featured no changes to the old tax system but witnessed significant revisions in tax slabs under the new system. This included an increase in the basic exemption limit and a rise in the tax rebate.
Boost in Capital Investment Outlay: For the third consecutive year, the budget saw a notable increase in the capital investment outlay, surging by 33% to 10 lakh crore, constituting around 3.3% of the GDP.
Focus on Health, Education, and Housing: The budget allocated substantial funds to the health and education sector, with specific missions announced, such as eradicating Sickle Cell Anemia by 2047. Additionally, the Pradhan Mantri Awas Yojana (PMAY) received a 65% increase in its outlay.

On February 1, Finance Minister Nirmala Sitharaman is set to present the final budget for the second term of the Narendra Modi government. However, since there’s a general election scheduled for April-May, the upcoming budget will be considered an ‘interim’ one. The complete budget for the financial year 2024-25 is expected to be tabled in July.

Exploring Last Year’s Budget Highlights and Anticipating Key Changes for 2024-25

In India, the financial year runs from April 1 to March 31 of the following year. Let’s look at five significant announcements from last year’s budget:

Income Tax Adjustments: The old tax system remained unchanged, but the Finance Minister revised tax slabs under the new system. The basic exemption limit was increased to 3 lakh from 2.5 lakh, and the tax rebate was raised to 7 lakh from 2 lakh. The standard deduction of 50,000, available under the old system, was also extended to the new one.

Capex Hike: The capital investment outlay received a substantial boost for the third consecutive year, increasing by 33% to 10 lakh crore. This accounted for around 3.3% of the gross domestic product (GDP).

Exploring Last Year's Budget Highlights and Anticipating Key Changes for 2024-25 — Exploring Last Year’s Budget Highlights and Anticipating Key Changes for 2024-25

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Health and Education Allocations: A significant 89,155 crore were allocated to the health and education sector. FM Sitharaman announced a mission to eradicate Sickle Cell Anemia by 2047 and mentioned the establishment of 157 new nursing colleges, in addition to the 157 medical colleges established since 2014.

PM Awas Yojana Enhancement: The outlay for the Pradhan Mantri Awas Yojana (PMAY) was increased by 65% to 79,000 crore, compared to the previous budget’s allocation of 48,000 crore.

Agricultural Focus: To encourage startups in rural areas, an Agriculture Accelerator Fund was introduced. The agriculture credit target was increased to 20 lakh crore, with a focus on animal husbandry, dairy, and fisheries. A new sub-scheme under the Pradhan Mantri Matsya Sampada Yojana (PMMSY) was unveiled with a targeted investment of 6,000 crore to support the activities of fishermen, fish vendors, and MSMEs (micro, small, and medium enterprises).