What Budget 2024 means for you, and top highlights: A quick guide

This was the sixth consecutive budget presented by FM Sitharaman

Finance Minister Nirmala Sitharaman's interim budget was largely a vote on account, that highlighted the Narendra Modi-led government's performance over the last 10 years, and the areas that will be in focus in the coming fiscal.

The budget refrained from listing any populist measures despite the looming general elections, but included key metrics, that highlighted fiscal consolidation and expansion of capital expenditure.

Track live updates of Union Budget 2024

Here's your guide to the Interim Union Budget 2024:

Key FY25 estimates

The total size of the 2024-25 Budget stands at Rs 47.66 lakh crore — 6.1 percent bigger than the revised estimate for 2023-24. To help meet the gap between its income and expenditure of Rs 16.85 lakh crore, or the fiscal deficit, pegged at lower-than-expected 5.1 percent of the GDP, the Centre will borrow Rs 14.13 lakh crore from the market by issuing bonds.

On a net basis, after adjusting for the payments it will make for bonds maturing the next financial year, the Centre's borrowing programme has been estimated at Rs 11.75 lakh crore.

Budget and you

Sitharaman made no changes in the income-tax (I-T) rates and slabs, either in the old I-T regime or the new I-T regime. Accordingly, both regimes, old and new, continue co-exist.

If your income is top to Rs 7 lakh and choose the new I-T regime, you do not have to pay any tax due to the higher tax rebate announced in last year's Budget (2023). The old tax regime also continues as usual.

Recognising the ordeal that small taxpayers go through when fighting in disputes with the income-tax department, Sitharaman announced some relief for old cases. For dispute cases pending since 1962, up until 2009-10, the government will withdraw disputes for outstanding tax demand of up to Rs 25,000.

Also, the outstanding demand up to Rs 10,000 would be waived off for disputes linked to financial year 2010-11 to 2014-15.

The move, Sitharaman said, is expected to benefit around 1 crore taxpayers.

Budget for women

Sitharaman announced a substantial increase in the target for the Lakhpati Didi scheme, originally set at two crore women, to three crore women. The scheme was unveiled by Modi last year, and is aimed at promoting women-led micro-enterprises within their respective villages.

By increasing the target to three crore beneficiaries, the government aims to create a broader base of financially empowered women.

Sitharaman also unveiled a strategic move to consolidate all maternal and child healthcare schemes under one comprehensive program. She further announced the extension of Ayushman Bharat -- Centre's health insurance coverage -- to Anganwadi and Asha workers.

Budget for students

Stressing on youth as one of the four groups whom the government is focussing upon, Sitharaman in her budget speech said more medical colleges would be set up soon. "A committee for this purpose will be set up to examine the issues and make relevant recommendations," she added.

Sitharaman also highlighted the role of Skill India Mission in training 1.4 crore youth, upskilling and re-skilling 54 lakh youth, and established 3,000 new Industrial Training Institute (ITI).

Budget for investors

Fiscal deficit at 5.1 percent and net borrowing of Rs 11.75 lakh crore for FY25 came in better than street expectations which is likely to be positive for bond markets.

Capex was pegged at 11.1 percent, and the government's main focus was on key infrastructure segments including railways, metros, power, capital goods. They will stay supported by government spends.

No change was announced in long-term/short-term capital gains tax, direct or indirect taxes, meaning post-tax return economics stands unchanged across asset classes for local investors.

Market musings

Equity benchmarks the Sensex and Nifty ended with modest losses on February 1 after Sitharaman tabled the Interim Budget 2024-25 which steered clear of big-bang announcements ahead of the general elections.

The reduction in fiscal deficit target and net borrowings will impress the market, experts underlined following the FM's budget speech, whereas, the modest hike in capex outlay and lack of consumption boost may have disappointed it.

India Inc's verdict

The interim budget  was welcomed by leaders of corporate India for setting the roadmap for inclusive and sustainable growth of the economy, focus on infrastructure capex and innovation, while also ensuring fiscal prudence.

“In the Interim Union Budget 2024-25, Finance Minister Nirmala Sitharaman has provided a comprehensive roadmap for sustained economic growth that will enable India to achieve a developed economy status by 2047,”  said Kiran Mazumdar Shaw, Executive Chairperson, Biocon.

Ajay Singh, CMD, SpiceJet and President, ASSOCHAM, commented that the increase in infrastructure spending will have a multiplier effect on our economy.

“The standout feature of the Interim Budget 2024-25 was its adherence to fiscal discipline, exemplified by the decision to cap Fiscal Deficit for FY2024-25 at 5.1%,” said Mohit Malhotra, Chief Executive Officer, Dabur India.

Unique acronyms

FDI, GDP and GYAN – or Foreign direct investment, Gross domestic product and just plain knowledge (Hindi translation) – found innovative interpretations in the finance minister’s speech.

She referred to FDI as ‘First Develop India’, GDP as 'Governance Development Performance’ and GYAN as 'Gareeb (Poor), Youth, Annadata (Farmer), and Nari (Woman)’.

Noteworthy...

Sitharaman, who was presenting her sixth consecutive budget, made her shortest-ever budget speech in the Parliament. The finance minister, counted amongst the most-lengthy budget speech makers in history, wrapped up her interim budget speech in a little under an hour, at 58 minutes. The speech had 5,246 words.