New Delhi, February 1, 2025 — Finance Minister Nirmala Sitharaman presented the Union Budget 2025-26 in Parliament today, marking her 8th consecutive budget presentation, a historic feat in Indian politics. The budget focuses on driving economic growth, creating employment opportunities, and promoting social welfare, with major reforms in taxation, infrastructure, healthcare, agriculture, and technology.
This budget is seen as a strategic roadmap to achieve the goals of ‘Atmanirbhar Bharat’ (Self-Reliant India), aiming to strengthen fiscal stability, support emerging industries, and improve the quality of life for citizens across all sectors.
Top Highlights of Union Budget 2025-26
- Major Tax Reforms Announced
- Personal Income Tax (PIT) Reforms: The government has simplified income tax filing procedures, reducing the compliance burden on taxpayers.
- New Income Tax Slabs: Income up to ₹4 lakh will now be tax-free, offering significant relief to the middle class. The highest tax rate of 30% will apply only to incomes above ₹25 lakh.
- TDS & TCS Rationalization: Streamlining processes to improve tax administration efficiency.
- Customs Duty Exemptions for Key Sectors
- Basic Customs Duty (BCD) exemptions on critical minerals like cobalt powder, lithium-ion battery waste, and materials used in EV battery and mobile phone manufacturing.
- Exemptions also extended to 37 new medicines under the Patient Assistance Program, benefiting the healthcare sector.
- Social Security for Gig Workers
- Over 1 crore gig workers from platforms like Swiggy, Zomato, Zepto, and BigBasket will be issued ID cards, granting them access to social security benefits.
- Simplified registration under the e-Shram portal and inclusion in PM Jan Arogya Yojana.
- Boost to Healthcare and Pharmaceuticals
- 200 daycare cancer centers to be set up by FY 2026 across district hospitals.
- Import duty exemptions for life-saving drugs, with 36 drugs fully exempted from BCD.
- Infrastructure & Connectivity Expansion
- ₹1.5 lakh crore allocated for interest-free loans to states for infrastructure reforms.
- Over 100 new regional airports planned under UDAN 2.0, with a focus on connecting the Northeast and Bihar.
- Major investments in road, rail, and port connectivity projects to support logistics efficiency.
Sector-Wise Budget Allocations and Reforms
Income Tax
- New Regime Highlights:
- Income up to ₹4 lakh: 0% tax
- ₹4–8 lakh: 5%
- ₹8–12 lakh: 10%
- ₹12–16 lakh: 15%
- ₹16–20 lakh: 20%
- ₹20–25 lakh: 25%
- Above ₹25 lakh: 30%
- Senior Citizens: Tax deduction limit doubled to ₹1 lakh.
- TDS on Rent: Threshold increased from ₹2.4 lakh to ₹6 lakh annually.
Agriculture & Rural Development
- Kisan Credit Card: Loan limit increased from ₹3 lakh to ₹5 lakh.
- Launch of Atmanirbharta in Oil Seeds Mission (6-year plan) and Cotton Yield Improvement Program (5-year plan).
- Nutritional support for 8 crore children and 1 crore lactating mothers in rural areas.
Education & Technology
- Atal Tinkering Labs to be set up in government schools to promote STEM education.
- ₹500 crore allocated to establish Centers of Excellence in Artificial Intelligence (AI).
- Expansion of IIT Patna to boost student capacity.
Healthcare
- Duty exemptions on 36 life-saving drugs; six drugs to have only a 5% import duty.
- Strengthening district hospitals with daycare cancer treatment facilities.
MSMEs & Start-Ups
- Credit Guarantee Scheme coverage increased from ₹5 crore to ₹10 crore.
- Continuation of start-up benefits for five years from the date of incorporation.
Women’s Development
- Term loans up to ₹2 crore for first-time women entrepreneurs from SC/ST and backward classes.
- Financial support for women-led start-ups in technology and rural enterprises.
Environment & Clean Energy
- Launch of Clean Technology Manufacturing Mission to promote sustainable industries.
- Focus on nuclear energy R&D under the National Nuclear Energy Mission.
- Extension of the Jal Jeevan Mission until 2028 to ensure water security.
Economic Projections & Fiscal Roadmap
- Fiscal Deficit Target: Revised to 4.8% of GDP for FY 2025.
- Capital Expenditure: Set at a record high of ₹10.18 lakh crore, reflecting the government’s focus on infrastructure-led growth.
- FDI in Insurance: Limit raised to 100%, signaling India’s openness to foreign investments.
- MSME Growth: Special attention to export promotion and simplified access to credit for small businesses.
Why Budget 2025-26 Matters
The Union Budget 2025-26 is more than just a financial document—it’s a strategic blueprint for India’s future. Key reasons for its significance include:
- Middle-Class Relief: Major income tax reforms provide financial relief to salaried individuals and retirees.
- Boost to Employment: Focused investments in manufacturing, start-ups, and infrastructure will generate new job opportunities.
- Digital & Green Economy: Strong emphasis on technology, clean energy, and sustainable development initiatives.
- Global Competitiveness: Simplified tax structures and increased FDI limits make India more attractive to global investors.
- Social Security Expansion: Recognition and welfare schemes for gig economy workers mark a progressive shift in labor reforms.
Download the Full Union Budget 2025-26 PDF
For a detailed breakdown of all budget announcements, tax reforms, and sector-wise allocations, click here to download the complete Union Budget 2025-26 PDF.
