The Union Budget 2025-26 outlines a comprehensive roadmap for India’s economic growth, emphasizing infrastructure expansion, fiscal prudence, and inclusive development. With a total expenditure of ₹50.65 lakh crore, the budget prioritizes capital investment, social sector spending, and tax reforms while aiming to reduce the fiscal deficit to 4.4% of GDP. Key allocations include significant funding for railways, highways, defence, and rural development, reinforcing the government’s commitment to long-term economic stability and job creation.
Key focus of the 2025-2026 Budget includes:
Agriculture & Rural Prosperity
- Programs like the National Mission on High Yielding Seeds and Makhana Board aim to improve agricultural productivity.
- Enhanced credit for farmers, with short-term loans through Kisan Credit Cards (KCC) and the launch of missions to promote pulses production and sustainable cotton farming.
Support for MSMEs
- Revision of MSME classification to encourage growth with revised investment and turnover limits.
- Credit guarantees and customized credit cards for micro-enterprises, supporting up to 10 lakh micro-businesses.
- Focus on labor-intensive sectors, including footwear, leather, toy, and food processing industries to create jobs.
Infrastructure & Urban Development
- The Urban Challenge Fund allocates ₹1 lakh crore for redeveloping cities and water management.
- Support for states through a ₹1.5 lakh crore outlay for capital expenditure, including interest-free loans.
Technological & Educational Advancements
- Expansion of medical education, artificial intelligence initiatives, and Atal Tinkering Labs.
- Broadband connectivity in rural schools, Centers of Excellence for skilling, and development of IITs.
Tax Reforms
- Proposals for rationalizing tax structures and extending the deadline for filing updated returns.
- Income tax reform focused on the middle class, with deductions for senior citizens and adjustments in TDS limits for rent payments.
Financial Sector Reforms
- Increased foreign direct investment limits for the insurance sector and revamped credit score frameworks for rural areas.
- Introduction of the Grameen Credit Score to serve rural credit needs, and revamped KYC registry for speedier approvals.
Rupee Comes From (Budget 2025-26)
The government’s total revenue comes from various sources, categorized as follows:
- Corporation Tax – 17%
- Income Tax (includes Securities Transaction Tax) – 22%
- Customs Duty – 4%
- Union Excise Duties – 5%
- Goods & Services Tax (GST) & Other Taxes – 18%
- Non-Tax Receipts – 9%
- Non-Debt Capital Receipts – 1%
- Borrowings & Other Liabilities – 24%
Rupee Goes To (Budget 2025-26)
The government’s expenditure is divided into multiple categories:
- Central Sector Schemes (excluding Defence & Major Subsidies) – 16%
- Interest Payments – 20%
- Defence – 8%
- Major Subsidies (Food, Fertilizer, Petroleum, etc.) – 6%
- Finance Commission & Other Transfers – 8%
- State Share of Taxes & Duties – 22%
- Pensions – 4%
- Other Expenditure – 8%
- Centrally Sponsored Schemes – 8%
Total Revenue and Expenditure
Revenue Estimates
- Total Revenue Receipts: ₹34,20,409 crore
- Tax Revenue (Net to Centre): ₹28,37,409 crore
- Non-Tax Revenue: ₹583,000 crore
- Capital Receipts (including borrowings): ₹16,44,936 crore
Expenditure Estimates
- Total Expenditure: ₹50,65,345 crore
- Revenue Expenditure: ₹39,44,255 crore
- Capital Expenditure: ₹11,21,090 crore
- Effective Capital Expenditure: ₹15,48,282 crore
Deficit Indicators
Key Deficit Figures
- Fiscal Deficit: ₹1,56,89,36 crore (4.4% of GDP)
- Revenue Deficit: ₹5,23,846 crore (1.5% of GDP)
- Effective Revenue Deficit: ₹96,654 crore (0.3% of GDP)
- Primary Deficit: ₹2,92,598 crore (0.8% of GDP)
Deficit Financing
- Market Borrowings: ₹11,53,834 crore
- Securities against Small Savings: ₹343,382 crore
- External Debt: ₹23,490 crore
Sector-Wise Allocation
Major Expenditures
- Interest Payments: ₹12,76,338 crore
- Defence: ₹4,91,732 crore
- Pension: ₹2,76,618 crore
Subsidies:
- Food: ₹203,420 crore
- Fertilizer: ₹167,887 crore
- Petroleum: ₹12,100 crore
Key Infrastructure and Development Allocations
- Rural Development: ₹2,66,817 crore
- Education: ₹1,28,650 crore
- Healthcare: ₹98,311 crore
- Urban Development: ₹96,777 crore
- Transport Infrastructure: ₹5,48,649 crore
Transfer to States & UTs
Total Transfer to States & UTs: ₹25,01,284 crore
- State Devolution: ₹14,22,444 crore
- Finance Commission Grants: ₹1,32,767 crore
- Centrally Sponsored Schemes: ₹541,850 crore
- Other Grants & Loans: ₹3,74,725 crore
Key Government Schemes and Allocations
Agriculture & Rural Development
- PM-KISAN: ₹63,500 crore
- Mahatma Gandhi NREGA: ₹86,000 crore
- PM Awas Yojana (Grameen & Urban): ₵74,626 crore
Education & Employment
- PM Schools for Rising India (PM SHRI): ₹7,500 crore
- Samagra Shiksha: ₹41,250 crore
- Skill Development & Apprenticeships: ₹13,560 crore
Health & Social Welfare
- Ayushman Bharat – PMJAY: ₹9,406 crore
- POSHAN 2.0 (Nutrition Mission): ₹21,960 crore
- Social Assistance Programs: ₹9,652 crore
Infrastructure & Industrial Development
- Jal Jeevan Mission: ₹67,000 crore
- PM Gram Sadak Yojana: ₹19,000 crore
- Production Linked Incentive (PLI) Schemes: ₹2,445 crore
Budget Allocations for All Ministries (2025-26):
Top Ministries by Budget Allocation
- Ministry of Finance – ₹19,39,001.26 crore
- Ministry of Defence – ₹6,81,210.27 crore
- Ministry of Consumer Affairs, Food & Public Distribution – ₹2,15,767.09 crore
- Ministry of Railways – ₹2,55,445.18 crore
- Ministry of Road Transport & Highways – ₹2,87,333.16 crore
Key Ministry Allocations
Infrastructure & Development
- Ministry of Housing & Urban Affairs – ₹96,777.00 crore
- Ministry of Power – ₹21,847.00 crore
- Ministry of Ports, Shipping & Waterways – ₹3,470.58 crore
Social Sectors
- Ministry of Education – ₹1,28,650.05 crore
- Ministry of Health & Family Welfare – ₹99,858.56 crore
- Ministry of Women & Child Development – ₹26,889.69 crore
- Ministry of Rural Development – ₹1,90,405.53 crore
Scientific Research & Technology
- Department of Space – ₹13,416.20 crore
- Ministry of Science & Technology – ₹38,613.32 crore
- Ministry of Electronics & IT – ₹26,026.25 crore
Agriculture & Industry
- Ministry of Agriculture & Farmers Welfare – ₹1,37,756.55 crore
- Ministry of Commerce & Industry – ₹18,446.05 crore
- Ministry of Chemicals & Fertilizers – ₹1,61,965.21 crore
Law & Governance
- Ministry of Home Affairs – ₹2,33,210.68 crore
- Ministry of Law & Justice – ₹5,850.37 crore
- Ministry of External Affairs – ₹20,516.61 crore