Union Finance Minister Nirmala Sitharaman unveiled the much-anticipated Union Budget for 2025-26 on February 1, 2025, emphasizing transformative strategies across key sectors to propel India’s economic growth. Titled at over ₹45 lakh crore, the budget seeks to reinforce the government's commitment to sustainable development, with targeted support for agriculture, small and medium enterprises (MSMEs), and infrastructure development.
During her speech, Sitharaman underscored the importance of agriculture, citing it as the 'first engine' of development and acknowledging its role as the backbone of the rural economy. The budget proposes at least nine new agricultural missions, underlining increased efforts to uplift farmers and improve productivity. "Agriculture has been one of the few sectors to demonstrate stable growth, playing a key role in driving India’s economic development," she noted.
The Union Budget allocated ₹1.37 lakh crore to the Ministry of Agriculture and Farmers’ Welfare, down by 2.5% from previous estimates. Key initiatives include the 'Prime Minister Dhan-Dhaanya Krishi Yojana,' aimed at benefiting 17 million farmers through enhanced states' partnership and convergence of existing schemes. Other highlighted missions target pulses, cotton productivity, and high-yielding seeds, reflecting the government’s commitment to modernizing agricultural practices and increasing farmers' incomes.
Finance Minister Sitharaman also highlighted the MSME sector as one of the primary engines of economic growth, acknowledging its significant contribution to manufacturing output and exports. "With MSMEs contributing approximately 36% to manufacturing and 45% to exports, their role is undeniable," she emphasized. The budget introduces 10 lakh credit cards for micro-enterprises, each with a credit limit of ₹5 lakh, aimed at enhancing financial access for small businesses.
Industry experts, including Jyoti Prakash Gadia, MD at Resurgent India, praised the measures, stating, "The budget rightly emphasizes MSMEs' ability to contribute to inclusive growth. The availability of credit cards for micro-enterprises and increased guarantees for exporters are steps toward long-term development." The government also raised the credit guarantee cover for micro-enterprises from ₹5 crore to ₹10 crore, expected to inject ₹1.5 lakh crore additional credit over the next five years.
Meanwhile, the budget outlines significant investments for infrastructure, with capital expenditure on major infrastructure sectors rising by 38.8% since FY 2020. Major railway expansions, road transport improvements, and enhancements to the civil aviation and ports sectors are on the agenda, aiming to support economic recovery and boost manufacturing capabilities. Highlighted projects include the Mumbai-Ahmedabad high-speed rail and the Bharatmala Pariyojana, targeting the development of 34,800 km of national highways.
Infrastructure progress continues to be pivotal for India's growth, with planned expenditures focusing on smart city developments and urban transformation initiatives. The 'Smart Cities Mission' aims to deliver high-quality living standards and sustainable urban infrastructure across the nation, earmarking significant budgets for capacity development and transportation.
After the budget presentation, various stakeholders, including academic institutions like Chitkara University, hosted discussions to analyze the economic outlook. Madhu Chitkara, pro-chancellor of the university, stated, “Our focus should be on creating strategies bridging academic knowledge with employability and growth.”
Several sessions during the colloquium emphasized the importance of digitalization, fiscal policy, and rural empowerment as key components driving India’s potential for sustained growth, with notable emphasis placed on inclusive economic frameworks.
Overall, the Union Budget 2025-26 reaffirms India’s growth potential amid various challenges, with targeted sectors receiving much-needed support through innovative policies, funding initiatives, and regulatory reforms. The government’s commitment to infrastructure, MSME development, and agriculture positions India on the path toward becoming a self-reliant economy, continuously improving the livelihoods of millions.
Experts foresee optimistic prospects as the initiatives take root, with many calling for additional measures to support technology adoption and digital literacy among businesses to align with global advancements. The coming months will be pivotal as stakeholders eagerly anticipate the implementation outcomes of the budget’s ambitious proposals, generating discussions about India’s role as a growing economic powerhouse.