The Lok Sabha on July 30 passed the Union Budget 2024-25 presented by Finance Minister Nirmala Sitharaman on July 23. The budget, worth Rs 48.21 lakh crore, was approved by a voice vote. For FY 2024-25, the Budget Estimates (BE) forecast total expenditure at Rs 48.2 lakh crore, including a significant capital expenditure of Rs.11.11 lakh crore. Total receipts, excluding borrowings, are expected to be Rs.32.07 lakh crore, and net tax receipts are projected at Rs 25.83 lakh crore. The fiscal deficit for 2024–25 is estimated at 4.9 per cent of GDP, a 0.7 per cent reduction from the 5.6 per cent deficit reported in the provisional figures for 2023-24, showcasing progress in fiscal consolidation.
The budget focused on the four key pillars of society – underprivileged, women, youth and farmers. In her budget, Sitharaman mentioned nine priorities including, Productivity and resilience in agriculture, Employment and skilling, Inclusive human resource development and Social justice, Manufacturing and Services, Urban development, Energy security, Infrastructure, Innovation, research and development, and Next-generation reforms. The Union budget for 2024-25 is strategically focused on key sectors and initiatives. It prioritises employment, skilling, MSMEs, and the middle class.
The Finance Minister has fixed the fiscal deficit at 4.9 per cent of GDP despite higher allocations for social welfare schemes due to robust tax collections in a fast-growing economy. According to her, the fiscal deficit would be brought down further to below 4.5 per cent by 2025-26 as the government would stick to the fiscal consolidation path. The gross and net market borrowings through dated securities during 2024-25 are estimated at Rs 14.01 lakh crore and Rs 11.63 lakh crore respectively. Both will be less than that in 2023-24. The reduced borrowings by the government will leave more money in the banking system for companies to borrow for investments which will help to spur growth and create more jobs.
Earlier, the budget was sharply criticised by the opposition parties. The opposition had alleged that several states were ignored in the budget and the provisions were only made for Andhra Pradesh and Bihar. They alleged that the ruling BJP tried to appease its allies in the state. In line with that, Chief Ministers of various states boycotted the NITI Aayog meeting, which was held under the chairmanship of Prime Minister Narendra Modi. Overall, the budget has put more focus on what has been long discussed as vital issues: employment and skill development. Only time will tell how efficiently funds are being utilised and if they are translating to the outcome as expected.
