CURRENT AFFAIRS
CURRENT AFFAIRS
Description
The Union Budget for 2025-26 was presented by Finance Minister Nirmala Sitharaman on February 1, 2025, with a clear focus on fostering economic growth through four key areas: agriculture, micro, small, and medium enterprises (MSMEs), investments, and exports. The government is aiming to implement reforms across multiple sectors, emphasizing inclusivity and sustainable growth, with the broader goal of achieving a Viksit Bharat (Developed India) by 2047.
Agriculture Initiatives
The budget outlines various measures to boost agricultural productivity and self-sufficiency, including:
Self-Sufficiency in Pulses - A six-year plan, ‘Mission for Aatmanirbharta in Pulses,’ will focus on enhancing domestic production, particularly for tur/arhar (pigeonpea), urad (black gram), and masoor (red lentil).
Promotion of Makhana Cultivation - Bihar will establish a Makhana Board, supported by Farmer Producer Organizations (FPOs), aimed at benefiting 10 lakh individuals involved in the industry.
Rural Prosperity and Resilience Program - This initiative will offer skill training, investments, and technology to boost rural employment, in partnership with state governments.
High-Yielding Seeds Mission - The government will develop and commercialize over 100 new seed varieties that are pest-resistant, climate-resilient, and high-yielding.
Cotton Productivity Mission - A five-year plan to enhance cotton farming sustainability and productivity, including the promotion of extra-long staple (ELS) cotton.
Fisheries Development - Focus on sustainable fishing initiatives, especially in Andaman & Nicobar and Lakshadweep.
Kisan Credit Card (KCC) Loan Limit Increase: The KCC limit will rise from Rupees 3 lakh to Rupees 5 lakh under the Modified Interest Subvention Scheme.
PM Dhan Dhanya Krishi Yojana (PMDDKY) - A new program that will consolidate existing farming schemes and target low-output districts, aiming to increase farm production, promote eco-friendly practices, and improve irrigation and storage.
Additionally, a new urea plant will be established in Assam with an annual production capacity of 12.7 lakh tonnes, marking the seventh new plant since 2019.
Support For MSMEs
The budget provides significant support for MSMEs, including:
Increased Investment and Turnover Limits - Investment and turnover thresholds for MSMEs will be doubled, facilitating more growth opportunities.
Enhanced Credit Access - Credit guarantees for micro and small enterprises will rise from Rupees 5 crore to Rupees 10 crore, and startup guarantees will increase from Rupees 10 crore to Rupees 20 crore. MSMEs focused on exports will also have access to term loans up to Rupees 20 crore.
Customized Credit Cards for MSMEs - The introduction of Rupees 5 lakh Udyam credit cards, with an initial target of issuing 10 lakh cards in the first year.
National Manufacturing Mission - A push for ‘Make in India’ initiatives will support clean technology manufacturing, including solar panels, EV batteries, and wind turbines, aimed at reducing reliance on China.
Investments
Key investment initiatives include:
Jal Jeevan Mission Extension - The program will expand to provide 100% water supply coverage by 2028.
Urban Challenge Fund - Rupees 1 lakh crore will be allocated to improve urban infrastructure, including water, sanitation, and redevelopment projects.
Nuclear Energy Mission - A goal of developing 100 GW of nuclear energy by 2047, with a focus on small modular reactors (SMRs) and private sector involvement.
Shipbuilding Development - A Rupees 25,000 crore Maritime Development Fund will promote shipbuilding in India, along with revised subsidies for ships built in the country.
Regional Air Connectivity (UDAN Scheme) - The expansion of regional airports and helipads, particularly in the hilly and North East regions.
Export Promotion
The budget includes provisions for boosting exports:
Export Promotion Mission - Rupees 2,250 crore will be allocated to support export credit, cross-border factoring, and easing non-tariff barriers for MSMEs.
BharatTradeNet - A digital platform for trade documentation and finance to streamline international trade processes.
GCC National Framework - A plan to develop Global Capability Centres (GCCs) in Tier-II cities to promote back-office operations outside major metro cities.
Tax Reforms
Key tax reforms include:
Income Tax Exemption - No tax on incomes up to Rupees 12 lakh, with a standard deduction that allows salaried individuals to remain tax-free up to Rupees 12.75 lakh.
Tax Savings - Rebate of Rupees 60,000, along with changes in tax slabs, may lead to savings of up to Rupees 1.1 lakh.
Extension of Filing for Returns - Taxpayers can file updated returns up to 48 months from the end of the assessment year.
TDS and TCS Revisions - New thresholds for Tax Deducted at Source (TDS) and Tax Collected at Source (TCS) to benefit individuals and businesses.
Startups Tax Incentives - Startups incorporated before April 1, 2030, will receive a 10-year tax holiday.
Social Sector Allocation
Key social sector allocations include:
Education - The education sector will receive Rupees 1.28 lakh crore, a rise from Rupees 1.14 lakh crore in the previous budget, continuing a trend of increasing spending on education.
Rural Development - Allocation for rural development has been raised to Rupees 2.66 lakh crore, aiming to further rural infrastructure and employment.
Health - The health budget has been increased to Rupees 98,311 crore to improve healthcare facilities.
Gender Budgeting
In line with its focus on gender equality, the government has allocated Rupees 4.49 lakh crore for women and girls in the 2025-26 Budget, marking a 37% increase from the previous year. However, there are concerns regarding the consistency and implementation of gender-focused schemes.
Challenges
Despite the increased allocations, challenges such as gaps between budget estimates and actual expenditure remain. Issues such as education and healthcare funding, which still fall short of global standards, need to be addressed for more effective outcomes.
This budget reflects a comprehensive approach to growth, focusing on sectors that will contribute to long-term development while addressing immediate needs through strategic investments and reforms.
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