Presenting her eighth straight Budget in the Lok Sabha, Nirmala Sitharaman laid out a blueprint for next generation reforms including raising FDI limit in insurance sector, simplification of tax laws, cutting duties on intermediaries while providing enhanced fiscal support for welfare measures.
This she did while sticking to the fiscal consolidation roadmap that projected the fiscal deficit to come down to 4.4 per cent of the GDP in the financial year 2025-26.
For the current financial year fiscal deficit has been pegged at 4.8 per cent of GDP.
To bridge the fiscal deficit gap, the government is set to raise resources from the market to the tune of Rs 11.54 lakh crore on a net basis for the next fiscal year.
What is in the budget for the Middle class and marginalised?
In a relief to the middle class, Finance Minister Nirmala Sitharaman on Saturday exempted annual income of up to Rs 12 lakh from income tax and rejigged tax slabs as part of the Budget.
Sitharaman also announced a slew of initiatives for the poor and marginalised sections including the gig workers. It included a social security plan for gig workers and a major thrust on addressing the educational gaps in government-run schools.
She announced that broadband connectivity will be provided in all government secondary schools, a move that will bring the students at par with their private counterparts and also open new vistas of opportunities for them.
“50,000 Atal tinkering labs will be set up in schools to foster curiosity and scientific temper. Broadband connectivity to be provided to all government secondary schools,” she said.
“We propose to implement the Bharatiya Bhasha Pustak scheme, to help students understand subjects in their language,” she added.
The Finance Minister also spoke about the expansion capacity of higher education institutions. “Additional infrastructure will be created in 5 IITs created after 2014 for 6,500 students,” Sitharaman announced.
The Finance Minister said that the gig workers of online platforms will be provided with ID cards on the e-Shram portal and will be extended healthcare benefits under the PM Jan Arogya Yojana. This is expected to help about 1 crore gig workers.
The PM SVANidhi scheme, benefiting the street vendors, will also be revamped with enhanced loans from banks and UPI-linked credit cards with a Rs 30,000 limit.
Gift bags for poll-bound Bihar
The Union government on Saturday unveiled several big-ticket plans for poll-bound Bihar in the FY26 Budget, which include setting up of a makahana board, a greenfield airport as well as financial support for Western Koshi Canal Project in the Mithilanchal region of the state, PTI reported.
In the Union Budget 2025-26, Finance Minister Nirmala Sitharaman also announced the establishment of a National Institute of Food Technology, Entrepreneurship and Management in Bihar and the expansion of hostel and other infrastructure capacity at IIT Patna.
Other announcements for Bihar include the capacity expansion of Patna airport and development of a brownfield airport at Bihta.
While announcing the setting up of a makhana board in the state, Sitharaman said, “There is a special opportunity for the people of Bihar. A makhana board will be established in the state to improve production, processing, value addition, and marketing of makhana.” People engaged in these activities will be organised into FPOs (Farmer Producer Organization), which will provide handholding and training support to makhana farmers.
These FPOs will also work to ensure they receive the benefits of all relevant government schemes, she added.
The assembly election is scheduled to be held in the state later this year.
LIVE updates:
12:15 pm: Govt to forgo Rs 1 lakh cr on direct taxes, Rs 2,600 cr on indirect taxes on account of changes in tax rates.
12:12 pm: No income tax payable under the new slabs upto an income of Rs 12 lakh per annum.
Person with annual income of Rs 12 lakh will get benefit of Rs 80,000 in tax, with 18 lakh annual income Rs 70,000.
12:03 pm: The Government’s gross and net borrowing for FY26 is projected at Rs 14.82 lakh crore and Rs 11.54 lakh crore, respectively, similar to the planned market issuances for FY25.
In FY25, gross and net borrowing stood at Rs 14.13 lakh crore and Rs 11.75 lakh crore.
12:02 pm: New Income Tax Bill will reduce litigation and will be simpler.
11:55 am: 120 new airports to be connected under the New Udaan scheme.
11:52 am: Over 100 provisions to be decriminalised with Jan Vishwas Bill 2.0.
11:47 am: Government to target Fiscal Deficit for FY 26 at 4.4 percent.
11:45 am: New Income Tax Bill to be introduced next week. Insurance FDI hiked 74 percent to 100 percent.
11:38 am: Focus on Buddhist religious places and their development.
11:37 am: Top 50 tourist destinations will be developed alongside states across the country.
11:35 am: Government to launch modified UDAN scheme to connect 120 destinations, help 4 crore additional passengers in next 10 years.
11:30 am: Electricity distribution reforms and intra-state transmission capacity will be incentivised to improve the financial health of DISCOMS.
11:27 am: ID cards and registration on E Sharm Portal for Gig and Platform workers; they will be provided healthcare under the PM Jan Arogya Yojana, likely to affect 1 crore workers.
11:26: Cancer centres to be set up in districts across the country.
11:25 am: The government aims to bring in 75,000 additional medical seats in the next 5 years.
11:23 am: Broadband will be introduced to government secondary educational institutions under the Bharat Net program to secondary educational institutions.
11:22 am: The Central government will enhance the limit for the interest subvention scheme for Kisan Credit Card from Rs 3 lakh to Rs 5 lakh. Credit guarantee cover to be doubled to Rs 20 crore, guarantee fee moderated to 1 pc.
11:15 am: India Post to be transformed into large public logistic organisation with 1.5 lakh rural post offices to become catalyst for rural economy, says Sitaraman.
11:10 am: Center to set up Makhana Board in Bihar. A food processing institute will also be set up in the state under the National Manufacturing Mission.
11:09: Center to launch six-year plan for Aatma Nirbharta in pulses, especially Toor and Urad among others, with a focus on agriculture and farmers in the country.
11:00 am: Nirmala Sitharaman begins historic 8th speech as finance minister in the Parliament amid commotion and sloganeering. The proposed development measures in Budget 2025 span ten broad areas focusing on Garib, Youth, Annadata and Nari are as follows.
10:41 am: The opposition too is hopeful for some relief for the middle class, however, has little hope. “Budget has an intent, content – it both makes the extent of the budget. We don’t have much expectations from the budget that some big announcements will be made and that will encourage private investment… Let’s see if there will be some tax relaxation for the middle class or not. Also, we need to see if the investors get some relaxation from the ‘tax terrorism’. We have demanded some reforms in GST. Modi 3.0 is being discussed all over the world, let’s see when GST 2.0 comes,” said Congress MP Jairam Ramesh.
10:04 am: Prime Minister Narender Modi arrives at the Parliament House for the cabinet meeting.
Expectations of relief on income tax, particularly for the lower middle class, are high after Prime Minister Narendra Modi invoked the goddess of wealth for elevating the poor and middle class.
“I pray to Goddess Lakshmi that the poor and the middle-class sections in the country are blessed by her,” Modi said on Friday while speaking to reporters outside Parliament before the start of the Budget session.
10:00 am: “The Budget will be presented in the Parliament shortly. There are many challenges before Union Finance Minister Nirmala Sitharaman because the growth has slowed down. This has lowered people’s income and employment opportunities. The government will have to provide incentives for economic growth and strong treasury,” said Economic expert Suryakant Shukla.
9:55 am: Sitharaman and other Union ministers arrive at the Parliament ahead of a pre-budget cabinet meeting at 10 am.
9:41 am: Nirmala Sitharaman and MoS Finance Pankaj Chaudhary met President Droupadi Murmu at the Rashtrapati Bhavan ahead of the Budget 2025.
9:14 am: Sitharaman, India’s first full-time woman Finance Minister, broke away from the colonial tradition of carrying a Budget briefcase in July 2019, opting instead for a traditional ‘bahi-khata’, to carry the Union Budget papers. She posed before the media with her team in the process of preparation of the budget.
She continued this custom the following year, and in the pandemic-affected 2021, she replaced the traditional papers with a digital tablet to carry her speech and other Budget documents.
Draped in an off-white handloom silk saree with fish-themed embroidery and golden border, Sitharaman posed for the traditional ‘briefcase’ photo outside her North Block office.
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