The Union Budget 2024-25 will be presented by Union Finance Minister Nirmala Sitharaman on February 1, 2024, at Lok Sabha. It will be a “Interim Budget” for the fiscal year commencing on April 1, 2024, and concluding on March 31, 2025.
Union Budget 2024-25 Date
The Indian parliament will witness the presentation of the Union Budget for the fiscal year 2024-25 on Thursday, February 1st, 2024 at 11:00 AM. It will be an “Interim Budget” for the fiscal year commencing on April 1, 2024, and concluding on March 31, 2025.
The budget is likely to focus on five key social sections, including the welfare of the poor, women, youth, farmers, and tribals. The agriculture sector is expected to continue to receive an allocation of funds, and the outlay for capital expenditure is likely to increase.
The budget will only be in effect until the results of the Lok Sabha Elections in 2024 are known and a new government is elected. It will outline spending for the first few months of FY 2024–25, or until the next government takes office.
Why an Interim Budget?
Key reasons, why an interim budget is presented instead of a full budget in the year of Lok Sabha elections:
- Election regulations: Indian election regulations prevent the outgoing government from making big financial announcements during the election campaign period.
- Continuity of essential services: An interim budget ensures continued funding for essential government services like salaries, defence, and existing ongoing programs.
- Limited policy changes: Major policy reforms or significant changes in taxation are usually )avoided in an interim budget to give the incoming government the flexibility to formulate its own roadmap.
- Fiscal prudence: The outgoing government prioritises maintaining fiscal discipline and managing the deficit in an interim budget, ensuring financial stability for the transition period.
- Short-term outlook: An interim budget covers only a few months until the new government takes office, so it focuses on essential spending and avoids long-term commitments.
- Levelling the playing field: An interim budget ensures that the outgoing government does not make any major policy decisions that could unfairly benefit specific sectors or groups,maintaining a fair and neutral environment for the upcoming elections.
What to expect from the Union Budget 2024-25?
While major policy reforms and significant changes in taxation are unlikely, the interim budget might focus on the following aspects:
- Continuation of existing schemes: Key government programs related to social welfare, agriculture, infrastructure, and defence are expected to receive continued funding.
- Populist measures: The government might announce some populist measures in the form of subsidies, tax relief for specific sectors, or increased allocations for social security schemes to woo voters.
- Fiscal prudence: Maintaining fiscal discipline and managing the deficit will be a priority, especially considering the global economic uncertainties.
- Laying the groundwork: The budget may hint at long-term policy initiatives that the new government could pursue after the elections.
What won’t be in the Union Budget 2024-25?
Here’s a rundown of things you won’t find in the upcoming interim budget:
- New Flagship Schemes: No grand launch of new flagship programs or alterations to existing ones are expected. The focus will be on continuity and running already established schemes.
- Major Tax Reforms: Substantial changes in direct or indirect taxes like income tax or GST are unlikely.
- Long-Term Fiscal Plans: The interim budget won’t delve into elaborate, long-term economic or fiscal plans. These will be left for the new government to formulate after the elections.
- Controversial Policy Initiatives: Big, potentially controversial policy decisions that could spark debate or public opposition are usually avoided in an interim budget.
- New Commitments beyond Essential Spending: The interim budget prioritises essential expenditures like salaries, defence, and ongoing programs. New commitments involving significant resource allocation for fresh projects or initiatives are unlikely.
- Political Promises or Populism: While some measures appealing to specific sectors or groups may be announced, blatant populist policies meant to woo voters are generally eschewed in an interim budget.
- Comprehensive Vision for the Future: The interim budget will provide a limited snapshot of the financial scenario, not a comprehensive vision for the future of the economy.
What are the key sectors that will be focused on in the union budget 2024-25?
The key sectors that will be focused on in the Union Budget 2024-25 include:
- Social Welfare: Schemes like MGNREGA, food security programs, and pensions for marginalised groups are expected to see continued funding to ensure income support and basic needs are met.
- Agriculture: Continued funding for farmer welfare programs like PM Kisan Samman Nidhi and Pradhan Mantri Fasal Bima Yojana is likely.
- Infrastructure: Maintaining momentum in infrastructure development, particularly in areas like railways, roads, and renewable energy, will be a priority.
- Education and Healthcare: Funding for existing education and healthcare programs like Ayushman Bharat Yojana is expected to continue.
- Defense: Maintaining adequate funding for defence needs will be a priority, given the geopolitical situation.