The Union Budget 2025–26 presented on February 1, 2025, focused on taxation, agriculture, small businesses, investment, infrastructure and measures aimed at supporting economic growth. Finance Minister Nirmala Sitharaman described agriculture, MSMEs, investment and exports as four key engines of development.
Here is a concise Budget 2025 summary covering some of the major announcements and policy changes.
Income Tax Changes
One of the most significant announcements in Budget 2025 was the proposed change to personal income tax under the new tax regime.
Individuals with annual income of up to ₹12 lakh were set to have no income tax liability under the new regime, excluding income taxed at special rates such as certain capital gains. For salaried taxpayers, the ₹75,000 standard deduction meant that income up to ₹12.75 lakh could result in nil tax liability, subject to the applicable provisions.
The Budget also proposed changes aimed at simplifying tax compliance and rationalising TDS and TCS provisions.
Agriculture Gets Major Focus
Agriculture was identified as the first engine of development in the Budget.
The government announced the Prime Minister Dhan-Dhaanya Krishi Yojana, targeting 100 districts with low agricultural productivity. According to the Budget announcement, the programme is expected to benefit around 1.7 crore farmers, with a focus on improving productivity, irrigation and access to credit.
The Budget also proposed a Mission for Aatmanirbharta in Pulses, with particular attention to tur, urad and masoor.
The government also proposed increasing the limit of loans available through the Kisan Credit Card under the Modified Interest Subvention Scheme to ₹5 lakh.
Support for MSMEs
Micro, small and medium enterprises were another major focus of Budget 2025.
The government proposed increasing the credit guarantee cover for MSMEs from ₹5 crore to ₹10 crore. The measure was presented as part of efforts to improve access to credit and support business expansion.
The Budget also proposed measures aimed at supporting manufacturing and strengthening India’s position as a production base.
Manufacturing and Investment
A National Manufacturing Mission was proposed to cover small, medium and large industries. The initiative is intended to further the broader Make in India objective and support manufacturing activity.
The Budget also included proposals relating to private-sector research and development, with ₹20,000 crore allocated for private-sector-driven research, development and innovation initiatives.
Education and Artificial Intelligence
Education and technology also featured prominently in the Budget.
The government announced plans to establish 50,000 Atal Tinkering Labs in government schools over five years.
A Centre of Excellence in Artificial Intelligence for Education was also proposed with a total outlay of ₹500 crore.
These announcements placed technology and innovation among the areas receiving additional policy attention.
Urban Development and Infrastructure
Budget 2025 also proposed measures for urban infrastructure and regional connectivity.
A ₹1 lakh crore Urban Challenge Fund was announced for developing cities as growth hubs.
The government also proposed a modified UDAN scheme aimed at improving regional connectivity to 120 new destinations.
The Budget further proposed a ₹15,000 crore SWAMIH Fund to support the completion of another one lakh stressed housing units.
Healthcare and Pharmaceuticals
Healthcare-related measures included customs-duty exemptions for 36 lifesaving drugs and medicines used in the treatment of cancer and certain rare and chronic diseases.
The proposals were part of the Budget’s broader measures concerning healthcare affordability and access.
Insurance Sector
Budget 2025 proposed increasing the Foreign Direct Investment limit in the insurance sector from 74% to 100%, subject to specified conditions.
The announcement formed part of the Budget’s financial-sector reform proposals.
Focus on Gig Workers
The Budget also recognised India’s growing gig economy.
Gig workers were proposed to receive identity cards, registration on the e-Shram portal and access to healthcare under PM Jan Arogya Yojana.
Fiscal Deficit Target
The government estimated that the fiscal deficit for FY 2024–25 would be 4.8% of GDP and set a target of 4.4% for FY 2025–26.
For 2025–26, total receipts excluding borrowings were estimated at ₹34.96 lakh crore, while total expenditure was estimated at ₹50.65 lakh crore. Net tax receipts were estimated at ₹28.37 lakh crore.
What Budget 2025 Means for Different Groups
The Budget contained measures across several sections of the economy:
- Individuals: Changes to the new income tax regime.
- Farmers: Agricultural productivity, irrigation and credit measures.
- MSMEs: Higher credit guarantee coverage.
- Businesses: Manufacturing and investment-related initiatives.
- Students: More focus on technology and AI education.
- Urban residents: Proposed funding for cities and infrastructure.
- Gig workers: Social-security and healthcare-related measures.
- Healthcare consumers: Customs-duty relief on selected medicines.
Budget 2025 Summary
The Budget 2025 summary shows a broad focus on taxation, agriculture, MSMEs, investment, exports, manufacturing and infrastructure. The income-tax proposals attracted particular attention, while initiatives for farmers, small businesses, education, urban development and healthcare covered several other areas of the economy.
The Union Budget 2025–26 therefore combined tax changes with sector-specific measures intended to support investment, consumption and long-term economic development. The official Budget documents provide the detailed provisions and conditions applicable to each announcement.