Interim Budget 2024-25: Attracting the Masses with Populist Schemes as Modi Eyes Re-election

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Crafting an interim budget with elections in sight, FM Nirmala Sitharaman unleashed a slew of populist measures. As PM Modi seeks renewal, the government refrained from major changes, focusing instead on agriculture, infrastructure, social schemes, vulnerable communities, entrepreneurship and skilling to take its report card to the polls.

The budget retains income tax slab rates, extends startups’ tax breaks, upgrades 40,000 railway bogies under Vande Bharat, boosts R&D via interest-free loans, and provides 300 free electricity units monthly to 1 crore households through solar rooftops. It claims lifting 25 crore people from poverty.

On education, 7 new IITs and 16 IIITs have been established. To boost infrastructure, tourism projects are planned for islands including Lakshadweep.

Moreover, the budget highlights schemes giving rural homes and MUDRA loans to women entrepreneurs. It claims increased female enrolment in higher education and workforce participation.

While fiscal deficit is pegged at 5.8%, sustainability remains key. An India-Middle East-Europe economic corridor has been proposed to gateway trade.

Hoping to ride back to power, Modi has used the budget to highlight his record on governance and implement strategies to win over India’s sizable youth and countryside community.

Some Key Highlights are as follows:

  • Free ration eliminates worries about food for 80 crore people
  • Eligibility criteria for applicants’ incorporation for section 80-IAC Tax Exemption has been extended to one more year to 31 March 2025. Therefore, companies that have been formed in the next one year can apply for a tax break of three years under Section 80-IAC.
  • Direct Benefit Transfer of Rs 34 lakh crore through PM Jan Dhan Account has resulted in Rs 2.7 lakh crore savings for the government.
  • 78 lakh street vendors have benefited from PM Swanidhi.
  • 11.8 crore farmers are given direct support through PM Kisan. 4 crore farmers are supported through insurance.
  • Electronic Agri Mandi has connected 1051 Mandis transacting Rs 2 lakh crore.
  • 30 crore Mudra Yojana Loans have been provided to women entrepreneurs. Governance, Development, and Performance are the new GDP.
  • Skill India Mission has trained 1.4 crore youth and retrained and up-skilled 54 lakh youth and established 3000 new ITIs.
  • The country’s capital spending for 2024-25 has been raised 11 percent to ₹11.11 lakh crore, or 3.4 percent of GDP.
  • The rural social landscape is transforming with 83 lakh SHGs, empowering nearly 1 crore women to become ‘Lakhpati Didis’.
  • The aviation sector has experienced significant growth, with the number of airports doubling to 149.
  • Withdrawing direct tax demands: Up to ₹25,000 for the period up to FY 2009-10 and Up to ₹10,000 for FYs 2010-11 to 2014-15.
  • FDI inflows stood at $596 billion, twice more than 2014-15.
  • PM Awas Yojana (Grameen): Despite COVID challenges, close to achieving 3 crore house target.
  • PM SVANIDHI has provided credit assistance to 78 lakh street vendors, from that total, 2.3 lakh have received credit for the third time.
  • PM Mudra Yojana has sanctioned 43 crore loans aggregating to Rs 22.5 lakh crore for the entrepreneurial aspirations of our youth.
  • The country received its highest-ever medal tally in the Asian Games and Asian Para Games in 2023.
  • Chess prodigy and our No. 1 ranked player Praggnanandhaa put up a stiff fight against world champion Magnus Carlsen in 2023, today, India has over 80 chess grandmasters compared to little over 20 in 2010.
  • Healthcare cover under the Ayushman Bharat Scheme will be extended to all Asha workers, all Anganwadi workers, and helpers.
  • Free cervical Cancer vaccines for girls from 9-14 years.
  • Application of Nano DAP on various crops will be expanded in all agro-climatic zones, similar to nano-urea.
  • GIFT IFSC and Unified Regulatory Authority IFSCA are creating a robust gateway for global capital and financial resources.
  • Implementation of Pradhan Mantri Matsya Sampada Yojana (PMMSY) will be stepped up to enhance aquaculture productivity from existing 3 to 5 tonnes per hectare,  double exports to 1 lakh crore, and generate 55 lakh employment opportunities in the future.
Mehul Shah
Mehul Shahhttp://www.rscindia.in/
Chartered Accountant | Blogger | Avid Traveller | Startup Consultant CA Mehul Shah is partner at Rasesh Shah & Co. and can be reached at [email protected]

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