Union Budget 2024-25 focus on Employment, Skilling and Manufacturing

Nirmala Sitharaman presented her seventh consecutive budget as the Union Finance Minister in the Lok Sabha on 23 July 2024.

She broke the record of Morarji Desai, who presented six consecutive union budgets. However, Moraraji Desai holds the record for presenting ten union budgets from 1959 to 1963 and 1967 to 1969.

Nirmala Sitharaman was appointed the Union Minister for Finance and Corporate Affairs on 31 May 2019.

Theme of the Union Budget 2024-25 

According to the Finance Minister, the budget's theme is to focus on 

Employment, Skilling, Micro, Small and Medium Enterprises (MSMEs), and the Middle class of the country. 

Budget Priorities 

The Modi government has set a target to make India a developed country or a Vikshit Bharat by 2047. To realise this goal, the budget has identified 9 priority areas. They are:

• Productivity and Resilience in Agriculture
• Employment & Skilling
• Inclusive Human Resource Development and Social Justice
• Manufacturing & Services
• Urban Development  
• Energy Security
• Infrastructure
• Innovation, Research & Development and
• Next Generation Reforms

Agriculture and Allied Sectors 

• Allocation of Rs 1.52 lakh crore for 2024-25.
• Allocation to Pradhan Mantri Kisan Samman Nidhi (Rs 60,000 crore), Modified Interest Subvention Scheme (22,660 crore), Pradhan Mantri Fasal Bima Yojana (14,600 crore) and Pradhan Mantri Annadata Aay Sanrakshan Yojana ( Rs 6,437 crore).
• The target is to include one crore farmers in Natural Farming.
• Ten thousand need-based bio-input resource centres will be set up for natural farming.
• A Digital Public Infrastructure (DPI)  for Kharif crops will be started in 400 districts of the country to assess crop yields. 
• Digital Public Infrastructure (DPI) for Agriculture will be implemented in three years to cover farmers and their lands.
• Six crore farmers and their land details will be brought under farmer and land registries.
• Jan Samarth-based Kisan Credit Cards will be enabled in 5 states. Jan Samarth is an online platform that connects lenders with beneficiaries.
• New 109 high-yielding and climate-resilient varieties of 32 field and horticulture crops are to be released for cultivation by farmers.
• The government will continue to work to achieve self-sufficiency in oil seeds such as mustard, groundnut, sesame, soybean, and sunflower. India is the world's largest edible oil importer, and it meets around 58 % of its edible oil requirements through imports.
• The government will provide financial support to set up a Network of Nucleus Breeding Centres for Shrimp Broodstocks.
• The National Bank for Agricultural and Rural Development( NABARD) will facilitate shrimp farming, processing, and export financing. 

Prime Minister Package for Employment, Skilling and Manufacturing in India 

The budget announced five schemes and initiatives under the Prime Minister Package to boost employment opportunities, skilling, and the manufacturing sector in the economy.

Scheme 1 

First Timers 

The government will provide one month's wage in three instalments to workers who have joined the organised sectors. 

The criteria are that the employee must be registered with EPFO(Employees Provident Fund Organisation), and the maximum salary shall be Rs 1 lakh. 

The maximum benefit is Rs 15,000.

Scheme 2 

Job Creation in the Manufacturing sector

Incentives will be provided to the employee and the employer for their EPFO contribution in the first four years of employment.

Scheme 3 

Support to employers

To encourage job creation, the government will re-reimburse the employer Rs 3,000 per month for 2 years towards their EPFO contribution for new employees they employ. The condition is that the new employee's salary shall be not more than Rs one lakh per month.

Scheme 4 

Skilling 

1000 ITI (Industrial Training Institute) is to be upgraded through the hub-and-spoke model over five years, with a budgetary allocation of Rs 60,000 crores.

Twenty lakh youths will be skilled over five years.

The Model Skill Loan Scheme will be revised to facilitate loans up to `Rs 7.5 lakh with a guarantee from a government-promoted Fund. This measure is expected to help 25,000 students every year.

Scheme 5 

Internship in Top Companies 

• Internship to one crore youth in the next five years in the top 500 companies of India.
• The training period is one year, 
• The Central government will provide the youth with a stipend of Rs 5000 per month and one-time assistance of Rs 6000.
• The Companies will pay for the training and 10 per cent of the internship costs from their CSR(Corporate Social Responsibility) fund.

Education Loan 

• Education loans up to Rs 10 lakh for higher education studies in India, with an interest subvention of 3 per cent. 
• Every year, one lakh students will be covered.
• This scheme is for students who are not covered under any government scheme.

Purvodaya

• A new plan, Purvodaya, will be launched for the all-round development of the eastern region of the country, covering Bihar, Jharkhand, West Bengal, Odisha and Andhra Pradesh. 
• An industrial node at Gaya will be developed along the Amritsar-Kolkata Industrial Corridor.

Pradhan Mantri Awas Yojana 

• Three crore additional houses are to be built in rural and urban areas of the country.

Women-led Development

• More than Rs 3 Lakh crore has been allocated in the budget for schemes benefitting women and girls.

Pradhan Mantri Janjatiya Unnat Gram Abhiyan

• A new scheme will be launched for the socio-economic development of tribal families in tribal-majority villages and aspirational districts. 
• The scheme will cover 63,000 villages and benefit 5 crore tribal people.

Bank Branches in North Eastern Region 

• One hundred India Post Payment Bank branches will be set up in the northeastern region.

Mudra Loans

• The limit of Mudra loans under the ‘Tarun’ category will be increased to Rs 20 lakh from the present Rs 10 lakh. 
• This new limit will apply to customers who have repaid their previous loans.
• Under the Pradhan Mantri MUDRA Yojana, micro units seeking loans have been categorised into Shishu, Kishore, and Tarun.
• Under the Shishu category, the maximum loan amount is Rs 50,000, while in Kishore, it is more than Rs 50,000 and up to Rs 5 lakh rupee,
• After the announcement in the budget for the Tarun category, the loan amount will be more than Rs 5 lakhs and up to Rs 20 lakhs for certain borrowers.

Industrial Parks 

• The government, in partnership with the state government and the private sector, will set up in or near 100 plug-and-play industrial parks .These parks will have fully developed infrastructure.
• Twelve industrial parks under the National Industrial Corridor Development Programme also will be sanctioned.

Critical Mineral Mission

• The government will launch a Critical Mineral Mission to increase domestic production, recycle critical minerals, and acquire critical mineral assets overseas.

Urban Housing

• Under the PM Awas Yojana Urban 2.0, one crore houses are to be built for urban poor and middle-class families in the next five years.
• The total investment required Rs 10 lakh crore, and the centre will contribute Rs 2.2 lakh crore in the next 5 years, 

Street Markets

• New scheme to support the development of 100 weekly ‘haats’ or street food hubs every year for the next 5 years in select cities.

Research and development of Small and Modular Nuclear Reactors

• The government, in partnership with the private sector, will set up Bharat small nuclear reactors.
• The government will collaborate with the private sector for research and development of Bharat Small Modular Nuclear Reactor.

Advanced Ultra Super Critical Thermal Power Plants

• NTPC and BHEL will set up a joint venture to set up a full-scale 800 MW commercial plant using Advanced Ultra SuperCritical (AUSC) technology.

Infrastructure investment by Central Government

• `Central government to spend Rs 11,11,111 crore (3.4 % of GDP) as capital expenditure for the infrastructure sector.

Infrastructure investment by State governments

• The central government will provide Rs 1.5 lakh crore interest-free loans to the state governments for investment in infrastructure projects.

Pradhan Mantri Gram SadakYojana (PMGSY)

• The central government will launch phase IV of PMGSY to provide all-weather connectivity to 25,000 rural habitations.

Irrigation and Flood Mitigation

• The government will assist Assam, Himachal Pradesh, Uttarakhand, and Sikkim for floods, landslides, and other related projects.
• Rs 11.500 crore to Bihar to support the Kosi-Mechi intra-state link project and 20 other projects.

Tourism

• Comprehensive development of Vishnupad Temple Corridor In Gaya, Mahabodhi Temple Corridor in Bodh Gaya and Rajgir in Bihar
• Assistance for developing temples, monuments, craftsmanship, wildlife sanctuaries, natural landscapes, and pristine beaches in Odisha.

 Research & Development

• Anusandhan National Research Fund for basic research and prototype development to be operationalised.
• A financing pool of Rs 1 lakh crore will be set up for spurring private sector-driven research and innovation at a commercial scale.

Space Economy

•  A Venture capital fund (VCF) of Rs 1,000 crore will be established to expand the space economy by fivefold in the next ten years.

NPS Vatsalya

• A new scheme, NPS Vatsalya, will be launched for minors. The parent of the minor will contribute to the NPS Vatsalya.
• When the child attains the age of 18, it can be converted into a normal NPS(National Pension System) account, 

Special Provision for Andhra Pradesh and Bihar 

Though the Narendra Modi government refused to grant special status to Andhra Pradesh and Bihar, it has announced a spate of projects for both states.

Andhra Pradesh 

• Rs 15,000 crore will be arranged in 2024-25 through multilateral development agencies for the development of Andhra Pradesh's new capital, Amravati.
• Full financing for the early completion of the Polavaram irrigation project on the Godavari River.
• Funds for the development of infrastructure, such as railways, roads, etc., for the Kopparthy node on the Visakhapatnam-Chennai Industrial Corridor and the Orvakal node on the Hyderabad-Bengaluru Industrial Corridor.
• The central government will provide grants for the backward regions of  Rayalaseema, Prakasam, and the North Coastal Andhra area of Andhra Pradesh.

Bihar 

The Budget has announced Rs 58,900 crore support to Bihar.

Financial support for Rs 11,500 crore for  Kosi-Mechi intra-state link and 20 other ongoing and new schemes, including barrages, river pollution abatement and irrigation projects. 

Rs  26,000 crore for four road projects 

(1) Patna-Purnea Expressway, 

(2) Buxar-Bhagalpur Expressway, 

(3) Bodhgaya, Rajgir, Vaishali and Darbhanga spurs and

(4) additional 2-lane bridge over river Ganga at Buxar. 

2400 MW Thermal Power plant projects at Pirpainti cost Rs 21,400 crore. 

New airports, medical colleges, and sports infrastructure will be constructed in Bihar.

Central Government Finance 2024-25 

The money received by the government through taxes and non-tax sources plus borrowings are called receipts.

Estimated Receipts in 2024-25 

Rs 32.07 lakh crore. It doesn't include borrowings. Out of the total estimated receipts the ;

• Revenue receipts, including tax and not tax -Rs 31.29 lakh crore
• Non Debt capital receipts -Rs 78,000 crore

Expenditure 

• Total expenditure in 2024-25 -Rs 48.21 lakh crore
• Revenue expenditure -`37.09 lakh crore (11.4 per cent of GDP).
• Capital expenditure: Rs 11,11,111 crore (3.4 per cent of GDP). This also includes Rs. 1,50,000 crore of financial assistance to the States for capital expenditure. 

Thus, India's government budget is a deficit budget as its receipts are less than its expenditures.

Deficits of the Government of India 

 All the figures are in percentage of India's Gross Domestic Product at Market prices.

Borrowings of the Central Government 

The government meets its fiscal deficit through borrowing. The government meets its fiscal deficit by borrowing through its long-term government securities, called dated securities, National Small Savings Funds (NSSF), which invest in special securities of the governments, State Provident Funds, and External borrowings.

Break up of the Borrowing plan for 2024-25 

• Borrowing through dated securities-  gross borrowings target of Rs 14.01 lakh crore and net borrowings Rs 11.63 lakh crore, 
• Through NSSF- Rs 4.20 lakh crore
• Through State Provident Fund - net borrowing of Rs  5000 crore 
• External Borrowings -Rs 15,952 crore.