Finance Minister Nirmala Sitharaman is scheduled to present the Union Budget 2025-26 today at 11 AM IST. This will mark her eighth consecutive budget presentation, setting a record as the first finance minister to achieve this milestone in India. The Union Budget 2025 comes amid a backdrop of projected GDP growth for FY26 between 6.3% and 6.8%, as highlighted in the recent Economic Survey, which emphasizes the need for structural reforms to drive economic growth
Finance Minister Nirmala Sitharaman is scheduled to present the Union Budget 2025 today, February 1, 2025, at 11:00 AM IST.
This will be her eighth consecutive budget presentation.
The budget session of Parliament commenced on January 31, 2025, and is divided into two phases: the first from January 31 to February 13, and the second from March 10 to April 4.
Union Budget Economic Context
Union Budget 2025 : The Indian economy is facing challenges with a projected growth rate of 6.4% for FY24, which is near its decadal average. The government aims to achieve an ambitious target of an 8% annual growth rate to meet its long-term vision of a developed India by 2047, referred to as “Viksit Bharat”
Market Reactions
Union Budget 2025 In anticipation of a pro-growth budget, the stock market has shown positive momentum, with the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) remaining open today despite it being a Saturday. The Sensex has seen significant gains leading up to the budget presentation
Live Coverage
For those interested in following the live updates of the Union Budget presentation, various news platforms are providing real-time coverage and analysis throughout the day
What are the key expectations from the Budget 2025 for the middle class
Union Budget 2025 expectations from the Union Budget 2025 for the middle class revolve around significant tax relief and enhanced deductions, aimed at easing financial burdens amid rising costs and stagnant wages. Here are the primary anticipations:
1. Tax Relief
- Income Tax Cuts: There is a strong expectation for potential income tax cuts, particularly for individuals earning between Rs 10 lakh to Rs 20 lakh annually. This could help increase disposable income and stimulate consumer demand, especially in sectors like consumer goods and automobiles.
- Revised Tax Slabs: Many taxpayers hope for the highest tax rate of 30% to apply only to those earning above Rs 20 lakh, rather than the current threshold of Rs 15 lakh. This adjustment would make the new tax regime more appealing.
2. Enhanced Deductions
- Section 80C Adjustments: Taxpayers are advocating for an increase in the deduction limit under Section 80C, currently capped at Rs 1.5 lakh, which covers various investments including ELSS and NPS contributions. A higher limit would allow for greater savings in instruments like PPF and life insurance.
- Housing Loan Benefits: There is a call for increasing the interest deduction cap on housing loans under Section 24(b) from Rs 2 lakh to Rs 3 lakh, which would particularly benefit first-time homebuyers. Additionally, an increase in standard deductions for salaried employees is anticipated to help with everyday expenses.
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3. Health Insurance Deductions
- Expectations also include enhancements to deductions under Section 80D for health and life insurance, which currently allows deductions of up to Rs 25,000 (and Rs 50,000 for senior citizens). Increasing these limits could better address contemporary healthcare costs. Union Budget 2025
4. Focus on Consumer-Centric Policies
- The government is expected to adopt a consumer-centric approach in economic policy, potentially through support for sectors like FMCG and real estate. This could involve leveraging Production Linked Incentive (PLI) schemes to lower costs and boost demand.
5. Job Creation and Wage Growth
- With a focus on economic recovery, measures aimed at job creation and wage growth are anticipated. This may include incentives for labor-intensive sectors and regulatory support for the gig economy, ensuring better employment stability.
These expectations highlight a collective hope among middle-class taxpayers for a budget that not only addresses immediate financial concerns but also lays the groundwork for sustainable economic growth.
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How might the Budget 2025 address the issue of job creation for the middle class
The Union Budget 2025 is expected to address job creation for the middle class through several strategic initiatives aimed at stimulating economic growth and enhancing employment opportunities. Here are the key approaches anticipated
1. Incentives for Labor-Intensive Sectors
- The government may introduce incentives for sectors that are labor-intensive, such as tourism, hospitality, and low-skilled manufacturing. These sectors have the potential to create a significant number of jobs, helping to absorb the growing workforce in urban areas.
2. Support for the Gig Economy
- Regulatory support for the gig economy is likely to be emphasized, ensuring better job security and stability for workers engaged in freelance and contract-based roles. This could involve recognizing gig work as a legitimate source of employment and providing benefits similar to traditional employment.
3. Infrastructure Development
- A focus on infrastructure projects is expected to be a cornerstone of the budget. Investments in infrastructure not only create direct jobs but also stimulate demand in related sectors, thereby generating further employment opportunities. This aligns with the goal of boosting economic activity through enhanced public capital expenditure.
4. Emphasis on Skill Development
- The budget may include allocations for skill development programs, particularly in areas aligned with technological advancements such as Artificial Intelligence (AI) and digital skills. By enhancing the skill sets of the workforce, the government aims to prepare individuals for emerging job markets and reduce unemployment rates among youth.
5. Encouraging Corporate Wage Growth
- The government has been nudging corporations to increase wages, arguing that higher wages are essential not only for improving living standards but also for boosting consumer demand. This could lead to a cycle where increased disposable income drives further job creation in various sectors.
6. Support for Women’s Workforce Participation
- Initiatives aimed at increasing women’s participation in the workforce may be introduced, such as tax exemptions for childcare expenses or support for creating daycare facilities. This could enable more women to join the labor force, thereby expanding the available talent pool.
7. Focus on Sustainable Growth
- The budget is expected to balance immediate job creation with long-term strategies that ensure sustainable economic growth. This includes reforms in land and labor laws, which are crucial for attracting investments and fostering a conducive environment for businesses to thriv
