Expectations from Union Budget 2025

 As the Union Budget 2025 approaches, several key expectations have emerged across various sectors:

Income Tax Reforms:

• Adjustment of Tax Slabs: There's anticipation that Finance Minister Nirmala Sitharaman may revise income tax slabs to provide relief to taxpayers. Proposals include increasing the exemption limit to ₹3 lakh and raising the Section 80C deduction limit to ₹2.5 lakh.
• Standard Deductions: Experts suggest implementing a flat 30% deduction on gross income to simplify tax calculations and benefit salaried individuals.

As the Union Budget 2025 approaches, various sectors have outlined their expectations to foster growth and development. Here's an overview:

·       Electronics Sector:

The Indian Cellular and Electronics Association (ICEA) advocates for reducing duties on electronic components, such as parts of mobile phones and televisions, to lower costs for domestic manufacturers. Additionally, there's a push for financial support to bolster domestic electronic component manufacturing, aiming to expand India's electronics manufacturing to $500 billion by fiscal 2030.

·         Agriculture Sector:

The agriculture sector anticipates increased investments in agricultural research, infrastructure, irrigation projects, and crop insurance schemes. These measures aim to boost farmers' income and productivity, ensuring food security and enhancing the livelihood of farmers.

·         Banking Sector:

Public sector banks are looking for significant allocations for recapitalization to strengthen their balance sheets and enhance lending capacity. There's also an expectation for support in digital banking initiatives, improved credit access for MSMEs, and a strengthened regulatory framework to ensure better governance and transparency.

·         Defence Sector:

Given geopolitical challenges, the defence sector expects a substantial increase in budget allocation for modernizing armed forces and acquiring advanced weaponry.

There's also a push for policies promoting domestic manufacturing of defence equipment, aligning with the 'Make in India' initiative, and increased investment in research and development for indigenous technologies.

·         Railways Sector:

The railways sector anticipates a 15-20% increase in capital expenditure, potentially crossing ₹3 lakh crore. Key projects include track upgrades, modernization of railway stations, and funding for the Mumbai-Ahmedabad bullet train. Additionally, there's a focus on safety, with investments expected in advanced safety systems and regular maintenance to prevent accidents.

 

Subsidies and Social Welfare:

• Increased Subsidy Allocation: The government plans to raise spending on food, fertilizer, and cooking gas subsidies by 8% to $47.41 billion in the next fiscal year, addressing higher food and energy costs.

Fiscal Consolidation:

• Deficit Reduction: The government aims to continue focusing on quality spending and safety nets, targeting a reduction of the fiscal deficit to 4.5% of GDP by FY26.

Sector-Specific Initiatives:

• Education and Skilling: There's an expectation for targeted tax breaks and incentivized collaborations between EdTech platforms and educational institutions. Additionally, access to skilling for economically disadvantaged students and interest-free loans may be introduced.
• Manufacturing and Technology: The budget is anticipated to focus on labor-skilling initiatives to address talent gaps in the manufacturing and technology sectors. Boosting R&D and innovation through targeted incentives, especially for businesses not benefiting from Production Linked Incentive (PLI) schemes, is also expected.

Customs Duty Reforms:

• Simplification of Duty Structure: To streamline the trade framework, customs duty slabs are likely to be reduced, simplifying the overall structure and promoting ease of doing business.

These expectations reflect a comprehensive approach to addressing economic challenges, promoting growth, and providing relief to various segments of society.