5 Minute Summary of the 2024 Interim Budget

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  • 01 Feb 2024
5 Minute Summary of the 2024 Interim Budget

Finance Minister Nirmala Sitharaman delivered her shortest budget announcement today as she presented the Interim Budget 2024, which lasted a little less than an hour.

Minister Sitharaman's presentation marked her sixth consecutive budget.

The Finance Minister highlighted India's booming economy. As per the speech, the Indian economy has witnessed a positive transformation in the last 10 years and people are looking towards the future with hope.

Here are a few key Budget 2024 highlights you shouldn’t miss. From taxation updates to big capex plans and economic boosts, we have it all covered!

Let’s jump right in…

The Interim Budget stated that the government is focussing on four major goals:

1. Garib

2. Mahila

3. Yuva

4. Annadata

Here’s what the budget announced for each of these:

Garib Kalyan, Desh ka Kalyan

  • In the pursuit of ‘Sabka ka Saath’ in the last 10 years, the Government has assisted 25 crore people to get freedom from multi-dimensional poverty.
  • PM-SVANidhi has provided credit assistance to 78 lakh street vendors. From that total, 2.3 lakh have received credit for the third time.

Momentum for Nari Shakti

  • 30 crore Mudra Yojana loans have been given to women entrepreneurs.
  • Female enrolment in higher education has increased by 28% in 10 years.
  • Women's empowerment through entrepreneurship, ease of living, and dignity for them has gained momentum in these 10 years.

Welfare of Annadata

  • Every year, under PM-KISAN SAMMAN Yojana, direct financial assistance is provided to 11.8 crore farmers, including marginal and small farmers.
  • Crop insurance is given to 4 crore farmers under PM Fasal Bima Yojana.

Empowering Amrit Peedhi, the Yuva

  • National Education Policy 2020 is ushering in transformational reforms.
  • The Skill India Mission has trained 1.4 crore youth, upskilled and reskilled 54 lakh youth, and established 3000 new ITIs.
  • A large number of new institutions of higher learning, namely 7 IITs, 16 IIITs, 7 IIMs, 15 AIIMS and 390 universities, have been set up.

The government stated that besides delivering high growth in terms of Gross Domestic Product (GDP), it is equally focused on a more comprehensive ‘GDP’, i.e., ’Governance, Development and Performance’.

The budget said that the government is working with an approach to development that is all-round, all-pervasive and all-inclusive.

It is working to make India a ‘Viksit Bharat’ by 2047, and it needs to improve people’s capability and empower them to achieve that goal.

The vision is for a Prosperous Bharat in harmony with nature, modern infrastructure and opportunities for all.

Fiscal and Macro Announcements

  • Capital Expenditure or Capex outlay for 2024-25 is set at Rs 11.11 lakh crore. This is 11% higher and stands at 3.4% of the Gross Domestic Product (GDP).
  • FY24 Fiscal Deficit target is revised to 5.8% of GDP from 5.9%.
  • For FY25, the Fiscal Deficit target is set at 5.1%.
  • The government plans to reduce the fiscal deficit to 4.5% in FY26.
  • For gross market borrowings in FY25, the target is set at Rs 14.13 lakh crore. Net market borrowing is seen at Rs 11.75 lakh crore.
  • Revised expenditure for FY24 is set at Rs 44.90 lakh crore.
  • Total revenue receipts in FY25 are estimated at Rs 30 lakh crore. This is against the revised estimate of Rs 26.99 lakh crore.
  • The Nominal GDP growth is seen at 10.5%.
  • FY24 Divestment Target is cut to Rs 30,000 crore; for FY25, the same is set at Rs 50,000 crore.

Taxation Developments

In a surprise move, Finance Minister Nirmala Sitharaman proposed no changes in Direct and Indirect Tax, including Import Tax.

So, the same tax rates for Direct and Indirect Tax have been retained. This means the same rates as the last budget announcement will be in effect.

Here are a few highlights from this space:

  • The budget announced that the government will withdraw old disputed direct tax demands of up to Rs 25,000 till FY09 and Rs 10,000 for FY11 to FY15. The same is set to benefit 1 crore taxpayers.
  • The tax receipts for 2024-25 are projected at Rs 26.02 lakh crore.
  • Tax breaks for start-up investments made by Sovereign wealth funds have been extended to March 31, 2025.
  • The number of tax filers rose by 2.4 times, and direct tax collection has trebled since 2014. Moreover, the tax base of Goods and Services Tax (GST) more than doubled.

Steering Towards a Resilient Economy

So, those were some of the key updates from the Indian Interim Budget 2024 that were announced by Finance Minister Nirmala Sitharaman today.

In conclusion, the Interim Budget promised some big economic reforms to drive India’s economic growth in the coming years.

As India moves closer to the upcoming elections, this budget sets a tone of stability and growth, aiming to build a resilient and inclusive economy.

For more budget insights, head over to #BeyondTheBudget by clicking here.

Sources: Interim Budget 2024, Economic Times, Moneycontrol

Disclaimer: This article is for informational purposes only and does not constitute financial advice. Investors should conduct their own research and consult with financial professionals before making any investment decisions. Read the full disclaimer here.

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