The Union Budget 2025-26 lays out a comprehensive roadmap for India’s transformation into a ‘Viksit Bharat,’ emphasizing agriculture, MSMEs, investments, and exports to drive sustainable and inclusive economic growth….reports Asian Lite News
The Union Budget 2025-26 is a milestone moment for India’s economy, delivering major boosts for MSMEs and the middle class. With a massive $550 billion budget—bigger than the GDP of several nations—it focuses on tax relief, business growth, and startup expansion. From enhanced credit access to a game-changing Fund of Funds initiative, this budget is all about powering innovation, fuelling entrepreneurship, and driving economic momentum.
India robust economic growth amid global challenges
Despite uncertain global economic conditions, India’s economy remains resilient. With a projected GDP growth of 6.4% for 2024-25, India continues to outpace major global economies. The Union Budget for 2025-26 is crafted with a vision to accelerate economic growth, ensure inclusive development, and enhance investments. It aims to bolster the spending power of India’s rising middle class, aligned with the national aspiration of ‘Viksit Bharat’ (Developed India).
The total Union Budget for 2025-26 is set at Rs50.65 lakh crore (approximately USD 550 billion), with an estimated fiscal deficit (4.4% of GDP) of Rs15.69 lakh crore (USD 179 billion). The budget focuses on achieving balanced growth, targeting inclusive development across all sectors and regions.
Budget focus on balanced growth for all
The 2025-26 Budget is built on the theme of ‘Sabka Vikas’ (Development for All), aiming to create an equitable economic framework. Key objectives include zero poverty, universal access to quality education and healthcare, a skilled workforce, equal economic participation by women, and transforming India into the “food basket of the world.” Ten significant measures (Garib, Youth, Annadata, and Nari – GYAAN) have been proposed, focused on enhancing agricultural productivity, rural prosperity, and boosting manufacturing.
Four key growth engines
India’s budget identifies four primary growth engines: Agriculture, MSMEs, Investments, and Exports. These engines will drive India’s growth through various transformative reforms in sectors like taxation, power, urban development, and mining, the financial sector, and regulatory frameworks. These reforms aim to improve infrastructure, governance, and long-term sustainability.
Agriculture as the first engine of growth
Agriculture remains the backbone of India’s economy, and the 2025-26 Budget places strong emphasis on rural development. Key initiatives include the Prime Minister Dhan-DhaanyaKrishiYojana, a programme to develop Agri Districts across 100 districts with low productivity. This initiative focuses on crop diversification, irrigation, and sustainable practices, positively impacting 1.7 crore (17 million) farmers.
Other significant measures include the Mission for Aatmanirbharta in Pulses to improve productivity in pulses, and a focus on Makhana production in Bihar to enhance value-added processing. These reforms aim to uplift rural incomes and promote demand-driven growth in the agriculture sector.
MSMEs as the second engine of growth
MSMEs are vital to India’s economic growth, contributing 45% to exports. The budget introduces several measures to support MSMEs, including raising investment and turnover limits for MSME classification. The government has also announced a new scheme to support 5 lakh women entrepreneurs, as well as SC/ST entrepreneurs, offering term loans up to Rs 2 crore over the next five years.
Additionally, the budget envisions transforming India into a global hub for toys through a dedicated initiative, alongside a National Manufacturing Mission that will integrate MSMEs with the Make in India initiative. A Fund of Funds (FoF) will be established to support high-growth startups, further fueling India’s entrepreneurial ecosystem.
Investments as the third engine of growth
The 2025-26 Budget emphasizes investments in education, infrastructure, and innovation. A major initiative includes the establishment of 50,000 Atal Tinkering Labs in government schools, promoting creativity and technological skills among students. The Bharatnet Project will enhance broadband connectivity to rural areas, while the BharatiyaBhashaPustak Scheme will digitize educational resources in Indian languages.
Infrastructure investments are substantial, with a 3-year pipeline of Public-Private Partnership (PPP) projects and interest-free loans for state projects. Additionally, a National Geospatial Mission will modernize land records and urban planning using advanced technologies.
The power sector will benefit from increased reforms to strengthen electricity companies and plans to develop 100 GW of nuclear energy by 2047. Tourism will receive a boost through the PM Gati Shakti initiative, which will promote 50 top tourist destinations and improve infrastructure to support global tourism.
Exports as the fourth engine of growth
Exports play a crucial role in India’s economic strategy. The budget announces an Export Promotion Mission aimed at helping MSMEs enter global markets. The Bharat Trade Net (BTN), a digital public infrastructure, will streamline trade documentation and provide financing solutions on a unified platform. This initiative is expected to boost domestic manufacturing and enhance India’s integration into global supply chains.
The government also proposes a National Framework for Global Capability Centres in tier-2 cities, supporting infrastructure and warehousing upgrades to facilitate high-value perishable exports, such as horticultural products.
Rationalizing the tax system
In line with the government’s focus on economic growth, the budget announces a comprehensive overhaul of the personal income tax structure. The new regime provides tax exemptions for those earning up to Rs 12 lakh (approx. USD 14000), benefiting the middle class significantly. The tax slab for incomes above Rs 12 lakh has been restructured, reducing the tax burden for those earning between Rs 12 lakh and Rs 24 lakh (approx. USD 28000). The highest tax slab of 30% will be applicable to income above Rs. 24 lakh.
Supporting domestic manufacturing and exports
To further support domestic industries, the budget rationalizes customs duties on industrial goods, reducing tariffs on key products such as textiles, marine products, and electronics. Basic Customs Duty (BCD) on lifesaving drugs, such as those used to treat cancer and rare diseases, has been completely exempted, offering relief to patients and their families.
The budget also announces measures to rectify the inverted duty structure, promoting Make in India initiatives and increasing exports. BCD exemptions on critical minerals are aimed at promoting value addition within India’s manufacturing sectors.
Roadmap for a Viksit Bharat
The Union Budget 2025-26 presents a detailed plan for India’s growth journey toward becoming a ‘Viksit Bharat’. By focusing on agriculture, MSMEs, investments, and exports, it sets the stage for sustainable and inclusive economic growth. Key reforms in taxation, infrastructure, and regulatory frameworks aim to promote higher employment, boost household incomes, and ensure equitable development across the country.
In conclusions, this budget serves as a catalyst for transforming India’s economy by empowering all sections of society, from farmers and entrepreneurs to the youth and women, ensuring that the benefits of growth reach every part of the nation. Through these transformative measures, India is poised to embark on an era of unprecedented development, fulfilling the aspirations of a developed nation.
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