Watch: Budget 2024 | What is in store for West Bengal?

Updated – July 24, 2024 08:55 pm IST

Published – July 24, 2024 08:05 pm IST

The Chief Minister raised questions on Centre’s proposal to provide flood assistance to neighbouring Sikkim. In her Budget speech, Ms. Sitharaman referred to devastating flash floods and landslides that wreaked havoc in Sikkim and added that the government will provide assistance to the State. The BJP had won most of seats in north Bengal including Darjeeling Lok Sabha seat.

The Finance Minister in the Budget also referred to West Bengal while stressing on a plan, Purvodaya, “for the all-round development of the eastern region of the country covering Bihar, Jharkhand, West Bengal, Odisha and Andhra Pradesh”.

Reporting: Shiv Sahay Singh

Production: Yuvasree S

Watch: Union Budget 2024-25 | Key Highlights

Union Finance Minister Nirmala Sitharman on July 23 announced her seventh consecutive budget. The presentation on July 23 was the first Budget by the BJP-led NDA government since it was re-elected in June.

Ms. Sitharaman said that the Budget will focus on employment, skilling, MSME and middle class. An allocation of ₹1.48 lakh crore for education, employment and skill development was announced.

Two key measures were announced for the insurance sector in the budget. One was reducing the TDS or tax deducted at source on payouts (payments by the life insurer concerned) in respect of life insurance policies from 5% to 2%. This amendment will come into force on October 1, 2024.

Likewise, the Budget has proposed to reduce TDS from 5% – 2% on the Payment of insurance commission. The amendment will take effect from April 1, 2025.

Watch: Budget 2024 | What’s in it for health sector??

The Union government has continued its emphasis on tackling non-communicable diseases and allocating funds for research in the healthcare sector, with Finance Minister Nirmala Sitharaman on July 23 announcing customs duty exemptions on three cancer treatment drugs — Trastuzumab Deruxtecan, Osimertinib, and Durvalumab.

The total outlay for the health sector was ₹89,287 crore, amounting to 1.85% of the budget expenditure, marginally up from 1.76%, and ₹79,221 crore in the revised estimate for budget 2023-24. This remains below the 2% mark for health outlays from FY18 to FY22.

The Health Ministry has been allocated ₹90,958.63 crore in the 2024-2025 budget, an increase from ₹80,517.62 crore in the 2023-24 revised estimates. The budget allocation for the AYUSH Ministry has been increased from ₹3,000 crore to ₹3,712.49 crore.

Watch: Budget 2024 | What’s in it for energy sector?

Finance Minister Nirmala Sitharaman’s Budget speech has for the first time signalled that polluting industries, such as iron, steel, and aluminium will have to conform to emission targets.

Currently, the industry in India has no curbs on emissions instead of carbon credits but is incentivised to achieve energy efficiency targets via a scheme called Perform, Achieve, Trade that has been operational since 2015.

Caps on emissions also tie in with new international norms, such as the Carbon Border Adjustment Mechanism, to be imposed by the European Union (EU) in 2026. This will entail a tax on iron, steel, and aluminium goods imported into the EU that are produced by looser emission standards that that imposed on similar industries in the EU.

Watch: Budget 2024: What’s in it for defence sector?

The allocation to the Ministry of Defence for FY25 is higher by approximately Rs 1 lakh crore (18.43 per cent) than the allocation for FY23 and 4.79 per cent more than the allocation of FY24, the MoD stated.

While maintaining the allocation made to the Ministry of Defence (MoD) during the interim budget presented on February 1, the Government has made an additional allocation to the tune of ₹400 crores on innovation in defence through the Acing Development of Innovative Technologies with iDEX (ADITI) scheme.

Watch: Budget 2024 | What’s in it for women and children?

Finance Nirmala Sitharaman said that the Union Budget 2024-25 carried an allocation of more than Rs 3 lakh crore for schemes benefitting women and girls and promoting women-led development, during her presentation of the Budget in the Lok Sabha on July 23.

To encourage the participation of women in the workforce, the government will tie up with industry to set up working women hostels as well as creche-facilities, she said. Further, this industry-government partnership is also expected to launch women-specific skilling programmes and promote market access to women-led SHG enterprises.

Under urban development, the government has encouraged the moderation of high stamp duty by all States for urban-related development. It has asked for a further lowering of duties for properties purchased by women.

Watch: Budget 2024 | What’s in it for MSMEs and manufacturing sector?

The MSMEs and labour-intensive manufacturing sector have a reason to cheer as the budget presented by the Finance Minister on Tuesday has a special focus on these units. The sector is going through a crisis phase for multiple reasons. The export market is just reviving for sectors such as textiles, and MSMEs in the manufacturing space have been asking for various support measures. 

The incentives announced for new jobs are expected to bring down the labour cost by 2% or so. Changes in customs duty for copper and ferrous scrap will give a 10%–12% cost advantage across the supply chain, say foundry owners. The government has proposed a credit guarantee scheme to facilitate term loans to MSMEs for the purchase of machinery and equipment without collateral or a third-party guarantee. The limit of Mudra loans will be enhanced to ₹20 lakh from the current ₹10 lakh, and MSMEs will get access to credit during the stress period through a guarantee from a government promoted fund.

Watch: Budget 2024 | What is in store for labour?

In her seventh budget speech, Finance Minister Nirmala Sitharaman announced three new employee-linked incentive schemes in the Union Budget for 2024-25. The three schemes, which are part of the Prime Minister’s package, will align with enrolment in the Employee Provident Fund Organisation and focus on the recognition of first-time employees, as well as support to both employers and employees.

The schemes will facilitate employment, skilling and other opportunities for 4.1 crore youth over a five-year period with a central outlay of ₹ 2 lakh crore. The Centre will provide ‘Employment Linked Incentives’ to employers based on enrolment in the Employees Provident Fund Organisation. One of the major proposal among this is to provide internship opportunities in 500 top companies to one crore youth for 12 months.

Students will get an internship allowance of ₹ 5,000 per month along with a one-time assistance of ₹ 6,000. Companies will have to bear the training cost and 10 per cent of the internship cost from their CSR funds. Many have interpreted this as the next Agniveer scheme given the casual nature of this scheme. Trade unions also seem to be not happy with the budget as their long pending demand of restoration of Old Pension Scheme is ignored this time too.

Union Finance Minister Nirmala Sitharaman presents the Union Budget 2024-25 in Lok Sabha, in New Delhi on July 23, 2024.
| Photo Credit: PTI

In her seventh budget presentation, Finance Minister Nirmala Sitharaman announced allocating Rs 11 lakh, 11 thousand and 111 crore towards capital expenditure. This would account for 3.4% of the GDP. Enumerating it as among the policy prerogatives towards investment in infrastructure by central government, she told the house that the significant investments made in previous years have triggered a multiplier effect.  

Also Read: Union Budget 2024 LIVE Updates

Ms Sitharaman elaborated that the endeavour is to provide strong fiscal support towards infrastructure in the next years in conjunction with other priorities and fiscal consolidation. She further urged, “We will encourage states to provide support of similar scale for infrastructure development based on their priorities.”  

The finance minister stated that private investment in infrastructure will be promoted through Viability Gap Funding and a market-based financing framework would be brought out. Chief Economic Advisor V. Anantha Nageswaran writing in the Economic Survey tabled on Monday had held that for India to build quality infrastructure, a higher level of private sector financing and resource mobilisation would be crucial. “Facilitating this would not only require policy and institutional support from the Central Government, but State and Local Governments would have to play an equally important role,” the Economic Survey author stated.  

Finance Minister Nirmala Sitharaman is presenting seventh consecutive budget on Tuesday. Prior to Monday, she has presented six full and one interim budget.