The Union Budget for 2025–26 was presented by Union Finance Minister Nirmala Sitharaman on 1 February 2025. This article is a historical study note: the items below summarise proposals and estimates announced for that budget year, not a claim that every proposal remains current or was implemented exactly as announced.
Primary source: Government of India, Union Budget 2025–26 — Finance Minister’s Budget Speech (1 February 2025). For enacted provisions and subsequent implementation, consult the relevant Finance Act, tax rules and official ministry notifications.
Taxation Reforms
- Personal income-tax proposal: The Budget announced a rebate structure intended to result in no income tax payable for an eligible resident individual with up to ₹12 lakh of normal income under the new regime; special-rate income such as capital gains was excluded. For salaried taxpayers, the speech noted a ₹12.75 lakh figure after the ₹75,000 standard deduction. This describes the 2025 Budget announcement; check the enacted law and current tax guidance for present-day application.
- TDS rationalisation: The Budget proposed increasing the annual threshold for tax deduction at source (TDS) on rent from ₹2.40 lakh to ₹6 lakh. This is described here as a Budget proposal for 2025–26; consult the applicable tax law and official guidance for current obligations.
- Customs duty relief on medicines: The Budget proposed adding 36 lifesaving drugs and medicines to the list fully exempt from Basic Customs Duty (BCD), and adding a further 6 lifesaving medicines to the list attracting concessional customs duty of 5%. The categories and implementation should be checked against the applicable customs notifications.
- New Income-tax Bill announcement: In the 1 February 2025 Budget speech, the Finance Minister said that a new Income-tax Bill would be introduced the following week to simplify the text of the law. This is a record of the announcement made on that date, not a statement that the bill is still pending.
Infrastructure & Energy
| Sector | Key Initiatives | Allocation/Target |
|---|---|---|
| Nuclear Energy | Private sector participation allowed; ₹20,000 crore for Small Modular Reactors | 100 GW nuclear capacity by 2047 |
| Urban Development | Urban Challenge Fund for city projects | ₹1 lakh crore fund |
| Power Reforms | 0.5% additional GSDP borrowing for states implementing electricity reforms | Improved discom viability |
Social Welfare & Healthcare
- Healthcare:
- Day Care Cancer Centres in all district hospitals within 3 years (200 in FY 2025-26).
- 10,000 additional medical college seats.
- Education:
- 50,000 Atal Tinkering Labs in government schools.
- Bharatiya Bhasha Pustak Scheme for Indian-language digital textbooks.
Agriculture & Rural Development
- PM Dhan Dhanya Krishi Yojana: Targets 1.7 crore farmers across 100 low-productivity districts.
- Makhana Board: Established in Bihar to boost regional agro-economy.
MSMEs & Employment
- Credit Support: Credit Guarantee Scheme for startups increased to ₹20 crore.
- Job Creation:
- 22 lakh jobs in footwear/leather sector via Focus Product Scheme.
- Scheme to make India a global toy hub.
Fiscal Strategy
| Indicator | FY 2024-25 (RE) | FY 2025-26 (BE) |
|---|---|---|
| Fiscal Deficit (% of GDP) | 4.8% | 4.4% |
| Capital Expenditure | ₹10.18 trillion | ₹11.2 trillion |
| Total Expenditure | ₹47.16 trillion | ₹50.65 trillion |
Global Investments & Exports
- FDI Liberalization: Insurance sector FDI limit raised to 100%.
- Export Incentives: Indirect tax measures to promote trade.
- Bilateral Treaties: Revamped investment treaties to attract foreign capital.
The budget balances fiscal prudence with growth-oriented reforms, emphasizing inclusive development through healthcare, education, and rural empowerment. Strategic investments in nuclear energy, urban infrastructure, and manufacturing aim to position India as a global economic leader while addressing immediate needs of the middle class and vulnerable sectors.
How to Revise Union Budget 2025 for Competitive Exams
A budget article becomes more useful when each announcement is connected to its policy objective, financial figure, sector and likely question format. For Union Budget 2025, separate tax proposals, expenditure measures, sectoral initiatives and fiscal indicators. This prevents a common revision error: remembering a number without remembering what the number represents.
High-Value Static GK Connections
| Area | Revision Point |
|---|---|
| Union Budget | Annual statement of the Union Government’s receipts and expenditure proposals |
| Fiscal deficit | Excess of total expenditure over total receipts excluding debt receipts |
| Capital expenditure | Spending that creates or improves long-term assets |
| Tax policy | Rates, thresholds, deductions, exemptions and compliance measures |
Possible MCQ Areas
- Who presented the Union Budget 2025?
- Which sector or scheme received a named allocation or target?
- What fiscal-deficit figure was budgeted for FY 2025-26?
- Which announcements related to healthcare, agriculture, MSMEs, infrastructure and employment?
Historical Accuracy Note
This is a historical study note on the Union Budget presented on 1 February 2025. Budget provisions should be read in their original financial-year context, and later implementation or policy changes should be checked against Ministry of Finance and Government of India sources.
How to Build a Budget Revision Sheet
For exam purposes, create four columns in your notes: proposal, sector, figure and policy objective. This is more effective than memorising a long list of announcements. Revisit the fiscal-deficit and capital-expenditure figures separately because they are common quantitative anchors in banking and government-exam questions. Then connect sectoral proposals with agriculture, healthcare, education, infrastructure, MSMEs and exports. When a question asks “which of the following”, the ability to identify the policy area is often more useful than remembering the wording of the original speech.
Related Preparation
Continue revision through the Current Affairs Hub for newer developments and the Daily Quiz for question-based practice.
