Union Budget 2025: Key Announcements

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Union Budget 2025: Key Announcements

The Union Budget of India, also known as Annual Financial Statement (Article 11 of COI), is the government’s annual financial statement that outlines the revenue, expenditure and policy priorities for the fiscal year, which runs from April 1 to March 31. The Finance Minister presents the Budget at the Lok Sabha every year.

The 2025 Union Budget was presented by Finance Minister Nirmala Sitharaman. She presented the second budget of the Modi 3.0 Government on February 1, 2025 at 11 a.m. This was her 8th consecutive budget presentation. 

To find out the key announcements of the Union Budget 2025, check out this article.

Major Announcements: Union Budget Speech 2025 

By keeping an eye on the latest announcements in the Budget, individuals can plan their financial strategies. The Union Budget provides information regarding the changes in taxes, investment opportunities and adjustments to tax-saving instruments. 

Here are the key announcements made by FM Sitharaman during her Union Budget Speech 2025:

Agriculture

Here are the key announcements related to the agriculture: 

• The PM Dhandhanya Krishi Yojna will cover 100 low-productivity districts with the aim to generate opportunities. At the panchayat level, it will increase storage and boost agricultural yield. The scheme will cover almost 1.7 crore farmers. 

• The Government will establish a urea plant in Namrup (Assam) to increase the urea supply. The plant will have an annual capacity of 12.7 lakh metric tonnes.

• FM announced that the Government will set up the Makhana Board in Bihar.

• The Kisan Credit Cards will provide short-term loans to approx. 7.7 crore farmers, fishermen and dairy farmers. The loan limit for the borrowers will increase from Rs. 3 lakh to Rs. 5 lakh.

Business

Here are the key highlights from the budget for the business sector:

• The Union Government will increase the credit guarantee cover for micro, small, and medium enterprises (MSMEs) from Rs. 5 crore to Rs. 10 crore. 

• The government will raise the investment and turnover limits for MSME classification by 2.5 times and 2 times, respectively.

• For startups, the government will increase the credit cover from Rs. 10 crore to Rs. 20 crore.

• Focus Product Scheme for the footwear and leather sector will be launched for generating 22 lakh jobs in the nation.

• FM announced plans to update the Bilateral Investment Treaty to make it more investor-friendly.

• The government will introduce Jan Vishwas Bill 2.0 to decriminalize over 100 offences. This will help businesses.

• GOI will also reduce the compliance burden for small charitable trusts by giving them 10 years for registration, instead of 5 years previously.

Education

Here are the key budget announcements for the education sector:

• FM Sitharaman announced that 10,000 additional seats will be added in medical colleges.

• Sitharaman announced the establishment of a Centre of Excellence for Artificial Intelligence in Education. It will be set up with a total investment of Rs. 500 crore.

• The government will set up a total of 50,000 Atal Tinkering Labs in Government schools within 5 years.

Tax

Here are the tax-related announcements made by FM Sitharaman during Budget speech 2025:

• A new Income Tax Bill will be introduced. It is expected to be based on the Direct Tax Code, which aims to replace the current Income Tax Act in force and make tax compliance streamlined for both individuals and businesses.

• Individuals will not have to pay any income tax on their income up to Rs. 12 lakh.

• Resident individuals who bring to their homes a total income up to Rs. 7,00,000 will not pay any tax due to rebate under the new tax regime.

• Individuals with an annual income of Rs 18 lakh will get a benefit of Rs 70,000 in tax.

• The Government will increase the annual limit for TDS on Rent to Rs 6 lakh. This limit was previously Rs 2.40 lakh.

• The threshold for tax collection on remittances under the RBI’s Liberalized Remittance Scheme will be increased from Rs 7 lakh to Rs 10 lakh.

• Limit for tax deduction on interest income to be doubled for senior citizens from Rs. 50,000 to Rs. 1 lakh.

Insurance 

Here are the budget highlights for insurance sector:

• The government will enhance the FDI limit in the insurance sector from 74% to 100%. This will be applicable for companies that invest their entire premium in India.

Renewable Energy 

Here are the major budget announcements for the renewable energy sector.

• The Finance Minister announced the National Manufacturing Mission to boost small, medium, and large industries and strengthen the Make in India initiative. The mission will support clean technology manufacturing and help develop an ecosystem for solar cells, EV batteries, motors, controllers, wind turbines, and grid-scale batteries.

Schemes & Funds

The Union Budget 2025 has introduced several key schemes to support vulnerable groups, boost entrepreneurship, and promote innovation:

• Government of India will revamp the PM SVANidhi scheme for street vendors. The scheme will offer enhanced loans from banks and UPI-linked credit cards with a Rs. 30,000 limit.

• The Government will support urban sector reforms through a Rs. 1 lakh crore Urban Challenge Fund to promote creative city redevelopment and growth as well as water and sanitation projects. The fund will help to transform cities into growth hubs.

• FM announced that the Government will launch a Nuclear Energy Mission for the purpose of research and development (R&D) of small modular reactors. The mission will have an outlay of Rs. 20,000 crore.

• Jal Jeevan Mission will extend until 2028 with an enhanced total outlay. It aims to achieve 100% coverage of potable tap water connections across rural households.

• The UDAAN regional connectivity scheme has facilitated 1.5 crore middle-class people in faster travel. The government will launch a modified Udaan scheme to enhance regional connectivity to 120 new destinations and serve 4 crore passengers over the next 10 years. 

Price Drops vs Price Hikes After Budget 2025

Following the Union Budget 2025, the prices of certain goods dropped, while others became more expensive. Here is a list of goods with price drops vs goods with price hikes:

Conclusion

The 2025 Budget outlined the government's fiscal policies, revenue and expenditure proposals and taxation reforms among other major announcements. The biggest announcement in the budget was that individuals earning up to Rs. 12 lakhs income will no longer have to pay income tax.

The Union Budget is a big step toward achieving the vision of ‘Viksit Bharat’ by supporting growth, jobs, and development. 

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