Finance Minister Nirmala Sitharaman presented the interim budget / Screengrab/Sansad TV

On February 1, Indian Finance Minister Nirmala Sitharaman presented her budget speech, unveiling the Interim Budget for the fiscal year 2024-25 at the Parliament. This presentation occurred a day after the initiation of the budget session.

The key highlights of the budget announcements included several common acronyms through which the finance minister presented the government’s vision for a Viksit Bharat,  the holistic development of India as well as all the Indians, and in turn, will help India to reach its cherished goal of becoming a developed country by 2047.

Sitharaman maintained that the budget was developed with a special focus on GYAN (knowledge), which she described as for Gareeb (Poor), Youth, Annadata (Farmer) and Nari (Woman). In the case of Foreign Direct Investment, commonly referred to as FDI, she stated that the government followed a First Develop India approach. She also highlighted the government’s aim to achieve GDP, which means more than the usual Gross Domestic Product and stood for Good Governance, Development and Performance.

With an estimated gross borrowing of US$ 170 billion (Rs. 14.13 trillion) for the fiscal year 2024-25, reflecting a reduction compared to the fiscal year 2023-24, the Finance Minister set an ambitious fiscal consolidation target, revealing an FY25 fiscal deficit goal of 5.1 percent, surpassing expectations that predicted a 5.3 percent level.  The fiscal year 2023-24 witnessed the accomplishment of the fiscal deficit target of 5.8 percent, attributed to improved revenue mobilization compared to the targeted 5.9 percent.

Moving towards achieving the goal of ‘Viksit Bharat’.#ViksitBharatBudget pic.twitter.com/rHDxCnjoBA

— Nirmala Sitharaman Office (@nsitharamanoffc) February 1, 2024

Sitharaman announced the introduction of a housing scheme targeting the middle class, allowing those residing in rented houses, slums, and unauthorized colonies to purchase or construct their own homes. The initiative aims to enhance housing accessibility. Furthermore, the budget outlined plans to establish additional medical colleges, utilizing existing infrastructure to address healthcare needs. 

The Ayushman Bharat scheme is set to expand its healthcare coverage to include all Anganwadi workers and helpers. To bolster farmers' income, intensified efforts will be undertaken, and the government plans to encourage private investment in post-harvest activities. Additionally, Sitharaman revealed the withdrawal of outstanding disputed tax demands, a move expected to benefit around 1 crore taxpayers.

The FM opted to maintain the existing tax rates, including import duties. However, specific benefits for start-ups and tax exemptions for certain International Financial Services Centre (IFSC) units, originally set to expire in March, will now be extended until March 2025.

The government is set to empower one crore households with the provision of up to 300 units of free electricity each month through rooftop solarization. Furthermore, there is a concerted effort to enhance and fortify the E-vehicle ecosystem by supporting both manufacturing and charging infrastructure. The promotion of E-buses for public transport networks will be incentivized through the implementation of a payment security mechanism.

Development of tourist centres across the country.#ViksitBharatBudget pic.twitter.com/fPqgYmbHgY

— Nirmala Sitharaman Office (@nsitharamanoffc) February 1, 2024

The imperative for growth and development facilitating reforms in various states is evident in the realization of "Viksit Bharat" (Developed India). In addressing this need, a significant proposal involves allocating a provision of US$ 9 million (Rs 75,000 crore) as a 50-year interest-free loan this year. 

The government has made income tax filing simpler with updated IT returns, a new Form 26AS, and pre-filled tax returns. The average processing time has been reduced from 93 days in 2014 to just 10 days this year, making tax refunds faster.

In line with the commitment to achieve Net Zero by 2070, the government is taking several steps. These include providing funding for offshore wind energy, boosting coal gasification and liquefaction capacity, and introducing mandatory blending of compressed biogas in natural gas for transport and domestic use. Additionally, financial assistance will support the procurement of biomass aggregation machinery for efficient biomass collection.