Highlights of Budget 2024
Feb 01, 2024The Finance and Corporate Affairs Minister Smt Nirmala Sitharaman, while presenting the Interim Union Budget for 2024-2025 in Parliament today announced that the capital expenditure outlay for the next year is being increased by 11.1 percent to Rs 11,11,111 crore, which would be3.4 percent of the GDP.
She said, this is in the wake of building on the massive tripling of the capital expenditure outlay in the past 4 years resulting in a huge multiplier impact on economic growth and employment creation.
As per the First Advance Estimates of National Income of FY 2023-24, presented along with the Finance Minister’s speech, India’s Real GDP is projected to grow at 7.3 percent. This is also in line with the upward revision in growth projections for FY2023-24 by the RBI (in its December 2023 Monetary Policy Committee meeting) from 6.5 percent to 7 percent, prompted by strong growth in Q2 of FY2023-24.
Indian economy has demonstrated resilience and maintained healthy macro-economic fundamentals, despite global economic challenges. The International Monetary Fund (IMF), in its World Economic Outlook (WEO), October 2023, has revised its growth projection for India for FY2023-24 upwards to 6.3 percent from 6.1 percent projected in July 2023. This reflects increasing global confidence in India’s economic prowess at a time when global growth projection for 2023 remains unchanged at 3 percent.
As per the IMF, India is likely to become the third-largest economy in 2027 (in USD at market exchange rate) and it is also estimated that India’s contribution to global growth will rise by 200 basis points in 5 years. Moreover, various international agencies such as the World Bank, the IMF, OECD, and ADB project India to grow between 6.4 percent, 6.3 percent, 6.1 percent, and 6.7 percent, respectively in 2024-25.
The Finance Minister stated that strong growth in economic activity has imparted buoyancy to revenue collections and pointed out that GST collection stood at ₹1.65 lakh crore in December 2023. This is the seventh time that gross GST revenues have crossed ₹1.6 lakh crore benchmark.
She said, coming to 2024-25, the total receipts other than borrowings and the total expenditure are estimated at Rs30.80 and 47.66lakh crore respectively.The tax receipts are estimated at Rs 26.02 lakh crore.
In a major announcement, the Finance Minister said, the scheme of a fifty-year interest-free loan for capital expenditure to states will be continued this year with total outlay of Rs1.3 lakh crore. A provision of seventy-five thousand crore rupees as a fifty-year interest-free loan is proposed this year to support the milestone-linked reforms of Viksit Bharat by the State Governments.
Referring to the fiscal consolidation, as announced in her Budget Speech for 2021-22, to reduce the fiscal deficit below 4.5 percent by 2025-26, Smt.
Sitharaman said, that the fiscal deficit in2024-25 is estimated to be 5.1 percent of GDP, adhering to that path.
Similarly, the gross and net market borrowings through dated securities during 2024-25 are estimated at Rs 14.13 and 11.75 lakh crore respectively and both will be less than that in 2023- 24.
Pointing out some of the bright spots of the economy, the Finance Minister informed that the Revised Estimate of the total receipts other than borrowings is Rs 27.56 lakh crore, of which the tax receipts are Rs 23.24 lakh crore. The Revised Estimate of the total expenditure is Rs 44.90 lakh crore. The revenue receipts at Rs 30.03 lakh crore are expected to be higher than the Budget Estimate, reflecting strong growth momentum and formalization in the economy.
Smt Sitharaman also stated that the gross and net market borrowings through dated securities during 2024-25 are estimated at Rs14.13 and 11.75 lakh crore respectively and both will be less than that in 2023-24.
She announced that the FDI inflow during 2014-23 was USD 596 billion marking a golden era and this is twice the inflow during 2005-14.
For encouraging sustained foreign investment, we are negotiating bilateral investment treaties with our foreign partners, in the spirit of ‘first develop India’, the Finance Minister added Smt Nirmala Sithramansaid, Prime Minister Shri Narendra Modi firmly believes and focuses on four major castes. They are, ‘Garib’ (Poor), ‘Mahilayen’ (Women), ‘Yuva’ (Youth), and ‘Annadata’(Farmer). She said, their needs, their aspirations, and their welfare are the government’s highest priority because the country progresses when they progress.
Smt Nirmala Sitharaman elaborated that this government’s humane and inclusive approach to development is a marked and deliberate departure from the earlier approach of ‘provisioning up-to-village level’. Development programmes, in the last ten years, have targeted each and every household and individual, through ‘housing for all’, ‘har ghar jal’, electricity for all, cooking gas for all, bank accounts and financial services for all, in record time, she added.
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