Four engines of growth

Union Finance Minister Nirmala Sitharaman’s budget for the 2025-26 fiscal has raised high hopes for taking forward with renewed vigour the growth story of the country, with all eyes set on the target for Viksit Bharat of 2047. Sitharaman has also introduced key reforms in tax policies, infrastructure, healthcare, and agriculture. With a focus on fostering economic growth, job creation, and social welfare, the budget aims to strengthen India’s self-reliance, enhance fiscal stability, and promote inclusive development across sectors. Though she has estimated a net tax receipt at Rs 28.37 lakh crore in the next twelve months with the total receipts other than borrowings being pegged at Rs 34.96 lakh crore, the fiscal deficit is estimated to be 4.4 percent of GDP. The total expenditure, as has been stated, is estimated to be Rs 50.65 lakh crore, thus leaving a yawning gap between receipts and expenditure. Sitharaman has also created history by presenting her eighth consecutive Union Budget, a budget that is expected to make significant allocations for various sectors like agriculture, industry, health, and education, which aim to provide relief to the common public and create employment opportunities. This budget is also essential for realising an ‘Atmanirbhar Bharat.’ Based on the key takeaways from India’s Economic Survey 2024-25, Sitharaman’s Union Budget is also expected to focus on sustaining economic growth, improving financial inclusion, and addressing challenges in employment and sectoral development.  The finance minister has also introduced significant tax benefits for the middle class while also supporting various sectors. Key proposals include boosting the footwear, leather, clean tech, and toy industries; enhancing rural water access; and developing nuclear energy, shipbuilding, aviation, public housing, tourism, insurance, textiles, electronic goods, and telecom. What, however, is most significant is that Sitharaman has put four engines in place to take the country’s economy forward in the new financial year, with agriculture being named as the first engine of growth. Agriculture has occupied the centre stage, with an increased Rs. 7 lakh cap on the subsidized Kisan Credit Card loans and targeted programmes for pulses, cotton, and makhana production. The ‘Rural Prosperity and Resilience’ programme aims to curb migration, but questions remain about its execution. Her other three engines focus, respectively, on the MSME sector, investment in people or human resources, and boosting exports by making ‘Make in India’ stronger in the months to come.