Finance Minister Nirmala Sitharaman is set to present the Union Budget for 2024-25 at 11 am on Tuesday (July 23, 2024) in the Lok Sabha, as approved by President Droupadi Murmu. The budget session will run from July 22, 2024, to August 12, 2024.

According to the Finance Ministry, the pre-budget consultations for Union Budget 2024-25 started on June 19, 2024, and concluded on July 5, 2024. This budget is the first full budget of PM Narendra Modi’s third term, focused on setting the path for a developed India by 2047.

President Droupadi Murmu mentioned in a speech during the joint session of Parliament that the Union Budget will include many “historic” measures and significant social and economic decisions.

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During in-person consultations, over 120 invitees from 10 stakeholder groups participated. These groups included experts, farmer associations, trade unions, education, health, employment, MSMEs, industry, economists, financial sectors, and infrastructure sectors.

Budget Expectations for Taxpayers

As per various media reports, the upcoming union budget is expected to increase the standard deduction limit for salaried individuals, currently fixed at Rs 50,000, potentially raising it to Rs 1,00,000.

For home loan borrowers, the budget may offer additional tax benefits under Section 24(b) of the Income Tax Act.

The union budget is also expected to support women’s well-being through subsidies on essential commodities and direct benefit transfers for cooking gas. Additionally, discounted healthcare services, especially for women, may be included.

There is also a possibility that the income tax exemption limit on interest from savings accounts will be raised to Rs 25,000 from the current Rs 10,000. For senior citizens, this limit might increase to Rs 50,000.

Budget Expectations for Middle-Class Individuals

Media reports say the government is likely to introduce measures to enhance benefits for government employees under the National Pension System (NPS), potentially including an assured pension option.

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Additionally, policymakers are expected to finalize incentives such as personal income tax reliefs, increased retention of Agniveers in the regular defense services, and additional government support for urban housing to boost the labor-intensive construction sector.

Budget Allocation and Purpose of the New PIL Scheme

The new PIL scheme is expected to receive a budget allocation between Rs 35,000-40,000 crore. This initiative aims to support local sourcing of components and build a strong ecosystem for electronics manufacturing in India.

By promoting domestic production and reducing dependency on imports, the scheme seeks to enhance the country’s self-sufficiency in the electronics sector, ultimately driving the industry’s overall growth and sustainability.

Government May Introduce Electronics PLI Scheme

According to MoneyControl, Union Budget 2024-25 is expected to unveil a new Production Linked Incentive (PLI) scheme aimed at sub-assemblies and components in the electronics sector, with an allocation of Rs 35,000 to Rs 40,000 crore.

In addition to expectations surrounding the PLI Scheme for the railway sector, Rail Vikas Nigam Limited (RVNL) has recently signed an MoU with Delhi Metro Railway Corporation (DMRC).

This agreement aims for RVNL to participate as a Project Service Provider in upcoming projects in India and abroad. These projects include Metro/ Railways/ High-Speed Rails/ Highways/ Mega-Bridges/ Institutional Buildings/ Workshops for Depots/ S&T works/ Railway Electrification.

Naidu and Nitish Seek Billions in Funds for the ‘Coalition Budget’

The upcoming Union Budget for 2024 is expected to promote infrastructure development, along with sectors such as defense, railways, and renewable energy.

Both N. Chandrababu Naidu (Chief Minister of Andhra Pradesh) and Nitish Kumar (Chief Minister of Bihar) are expected to push for more funding for their states in exchange for supporting the BJP.

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Naidu’s Financial Requests Include:

• Requesting more than Rs 1 lakh crore ($12 billion) in financial assistance.
• Funding allocated for metro projects in Vijayawada, Visakhapatnam, and Amravati.
• Allocation for a light rail project.
• Proposal for a Vande Bharat train service linking Vijayawada to Mumbai and New Delhi.
• Grants aimed at developing underdeveloped districts.
• Support for infrastructure initiatives like the integrated steel plant in Kadapa and the port of Ramayapatnam.

Bihar’s Financial Requests Include:

• Funding for the establishment of nine new airports.
• Allocation for two power projects.
• Funding for two river water management programs.
• Establishment of seven new medical colleges.

As per a Reuters report, both states are also urging the Centre to nearly double the unconditional long-term loans provided to all states for infrastructure development, raising the total to Rs 1 lakh crore ($11.98 billion).

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