Budget 2024–25: Catalysing India’s Path to Sustainable Growth and Prosperity

Joya Saikia

(The writer can be reached at joyasaikia1990@gmail.com.)

In a transformative move to boost India’s economic strength, the Union Budget for 2024–25 has embraced progressive reforms with renewed vigour. The MSME, e-commerce, and start-up sectors are witnessing a surge of optimism as they receive enhanced support on the journey towards a Viksit Bharat. The Finance Minister has unveiled a series of initiatives designed to uplift the Garib, Mahila, Yuva, and Kissan. These strategic measures are poised to elevate the Indian economy to unprecedented levels during the Amrit Kaal, fortifying its resilience amid a dynamic global environment.

Empowering MSMEs: The budget effectively champions the foundation of India’s industrial landscape by simplifying credit access for MSMEs. Out of the 633.9 lakh MSMEs in the country, a staggering 99% are micro-enterprises, totaling 630.5 lakh. These micro-enterprises often struggle to transition to small or medium enterprises due to limited access to formal credit. The budget addresses this by doubling MUDRA loan amounts and establishing new SIDBI branches, thereby easing credit availability. The introduction of the mandatory Trade Receivables Discounting System enhances liquidity, while industrial parks will provide essential digital resources typically out of reach for MSMEs. Furthermore, the new credit guarantee scheme for MSMEs, which offers term loans without the need for collateral or third-party guarantees, alleviates financial pressures and encourages entrepreneurship. This robust support is set to embolden MSMEs, allowing them to overcome their risk-averse tendencies and pursue ambitious growth trajectories as they advance towards 2047.

Fostering Skills and Employment: The new budget addresses the pressing need for job creation and skill enhancement among India’s youth. By prioritising skill development, the government is paving the way for training institutions and major corporations to collaborate in cultivating a pool of skilled professionals. These individuals will be well-positioned to enter the workforce, particularly within the MSME sector, which frequently faces financial constraints in training. Successful execution of these initiatives will be crucial in effectively kick-starting job creation and ensuring that the workforce is both skilled and ready to meet the demands of the evolving job market.

Bolstering the Rural Economy: The government remains committed to reinforcing the rural economy, recognising its pivotal role in driving the nation’s long-term growth. The 2024 budget introduces substantial measures aimed at boosting productivity and ensuring food security, particularly for grains and oilseeds. These initiatives are expected to foster the development of new economic hubs that will contribute to sustained rural advancement.

Additionally, the budget outlines ambitious plans to train 1 crore farmers in natural farming techniques, as well as in marketing, certification, and branding. This significant push towards organic farming will invigorate the sector. By addressing the impacts of climate change on agriculture, the government’s strategy reflects a forward-thinking approach to enhancing ecological resilience and securing the future of our food systems.

Boosting Start-ups and E-Commerce: The start-up community across India is celebrating the removal of the angel tax, a significant development highlighted in the new budget. Introduced in 2012, the angel tax levied charges on capital raised by unlisted companies from Indian investors if the share price exceeded the company’s fair market value (FMV). In addition, the budget brings good news for traders and artisans utilising e-commerce platforms. It not only reduces TDS rates but also decriminalises delays in TDS submissions, offering a much-needed boost. With e-commerce exports currently at $2 billion and projected to soar to $350 billion by 2030, the government’s revision of customs duties aims to invigorate this sector. These steps align with the Make in India initiative, supporting artisans and traders who market their products online.

Securing Energy for the Future: As India’s economy continues to accelerate, the demand for energy is escalating. The budget addresses this challenge by promoting private investment in small nuclear reactors and advancing research into innovative nuclear technologies, aiming to bolster the nation’s energy security. To manage growing energy needs, the budget outlines strategies such as regular energy audits across various clusters, enhancing larger commercial thermal plants, and implementing a pumped storage policy. These measures are designed to ensure a steady supply of energy. Nevertheless, the ambitious goals for transitioning to a green economy require further efforts to meet our targets for adopting sustainable fuels.

Transforming Land Records through Digitization: One of the most significant measures introduced in the budget is the digitization of land records, poised to greatly influence India’s economic trajectory. Many regions, particularly in rural areas, face challenges with land disputes and inadequate documentation, which hinder major project developments. By transitioning to digital land records nationwide, the government aims to eliminate intermediaries and decrease the volume of land-related legal disputes.

This move underscores the Union Budget 2024–25’s commitment to fostering long-term economic growth. With strategic investments and innovative policies, India is set to address global challenges while unlocking its vast socio-economic potential. Although the journey to a Viksit Bharat may encounter hurdles, the government’s sustained vision and progressive policies are expected to drive the realisation of this ambitious goal.