Budget 2025 touches upon all key elements to accelerate economic growth, say experts; check top views

Finance Minister Nirmala Sitharaman announced that individuals earning up to ₹12 lakh annually will not have to pay any income tax under the new tax regime, thereby giving relief to the middle class by raising exemption limits and rejigging slabs.

For salaried employees, this nil tax limit will be ₹12.75 lakh per annum, after taking into account a standard deduction of ₹75,000.

"The new structure will substantially reduce the taxes of the middle class and leave more money in their hands, boosting household consumption, savings, and investment," Sitharaman said in her Budget speech.

Measures to assist the poor, the youth, farmers, and women were a key part of the Budget for 2025-26, the finance minister said, highlighting plans for "transformative reforms in taxation".

Vikas Khemani, Founder, Carnelian Asset Management & Advisors

The Budget presented is good and progressive, especially in its reduction of personal income tax. This move will greatly benefit the middle class by leaving an additional ₹1 lakh crore in disposable income at their disposal, which is a substantial benefit. The budget aligns well with expectations, adhering to fiscal prudence, which is commendable.

While the markets might have anticipated a more relaxed fiscal approach, the current stance is satisfactory. Overall, the budget is well-received, incorporating numerous reforms aimed at increasing farm incomes and supporting farmers. There are also considerable measures in place to assist MSMEs and boost exports, making this a well-rounded budget that addresses the diverse needs of the populace.

Shanti Ekambaram, Deputy Managing Director, Kotak Mahindra Bank

The Union Budget strikes a balance between fiscal prudence and growth, with a focus on boosting middle-class consumption, savings, and investments through direct tax measures. The commitment to higher capital expenditure at ₹11 lakh crore, alongside a reduction in fiscal deficit to 4.4%, is a welcome move.

Additionally, the budget’s emphasis and measures on the 'engines of growth' MSMEs, agriculture, investment, exports, and ease of doing business are crucial to stimulating private sector investments. While 'accelerating growth' remains a key focus, the balance between fiscal discipline and growth measures will be critical for sustaining India’s economic momentum.

Vishal Kampani—Vice Chairman and Managing Director, JM Financial Ltd

The Budget has touched upon all key elements to accelerate economic growth. It has successfully managed to strike a balance among the trinity—offering fiscal stimulus to consumption, maintaining the fiscal glide path, and undertaking reforms to boost growth. In addition, the government has opted for the path of deregulation to boost the ease of doing business and achieve trust-based economic growth.

The tax relief by significantly raising the taxable limit and rejigging the tax slabs would give a major boost to consumer sentiment and consumption in the economy. With greater thrust on implementation and execution and the announcement of the asset management plan, it will bring a lot of efficiency to the economy with a greater public-private partnership.

All in all, it is a growth-focused budget that will boost all the growth levers—manufacturing, access to credit, exports, employment generation, innovation, technology development, sustainability, etc.—which will have a multiplier impact on the economy."

Amit Prakash Singh, Co-Founder & Chief Business Officer, Urban Money

The recent Budget’s zero-tax provision on incomes up to ₹12 lakh offers a significant advantage for borrowers and individuals seeking loans. By increasing disposable income, it alleviates financial pressure, making it easier to manage repayment obligations. Additionally, the enhanced savings capacity can contribute to larger down payments, reducing reliance on bigger loans and mitigating long-term financial strain.

Existing borrowers may also find it easier to allocate funds for prepayments, accelerating debt reduction. However, increasing loan deduction limits, particularly for home loans, would have further enhanced credit accessibility, making financing more affordable and boosting borrower confidence.

Rahul Singh, CIO—Equities, Tata Asset Management

The Union Budget proposals have prioritised consumption through personal tax cuts even while staying on the fiscal consolidation path. The focus on the investment cycle continues, but mainly through measures of ease of doing business and creating a conducive environment for private investments rather than budget allocations.

Focusing on building a domestic manufacturing base, urban infrastructure, and simplification of tax structures (both direct and indirect) is a positive development. The government has also chosen to sustain the push for tough reforms in the power sector as well as develop a long-term plan for public-private partnerships in infrastructure. The lack of any changes in capital gains is a short-term boost to the equity markets.

Anuj Puri, Chairman—ANAROCK Group

The Union Budget focused on economic expansion, infrastructure development, MSMEs, futuristic cities, and middle-class welfare and brought substantial relief for the middle class. It also aims to stimulate rural consumption—an essential step toward unlocking India’s economic potential.

From a real estate perspective, the budget delivers both direct and indirect benefits, acting as a catalyst for growth. However, a notable shortfall was the absence of major announcements for the affordable housing sector, leaving stakeholders disappointed.

Despite this, the budget overall remains strong and growth-oriented, with a clear focus on economic development and enhanced consumption.

Ashish Chauhan, CEO & MD—National Stock Exchange

The proposal of a nil tax on incomes up to ₹12.75 lakh per annum for salaried professionals will also help consumption.

"The much-expected tax relief is given to the taxpayer up to ₹12.75 lakh per annum for a salaried person who does not have to pay even a rupee as tax. I think that is a very welcome move, which will help consumption and also investment increase into markets," Chauhan told PTI.

He added that as consumption increases, the profitability of companies will also increase. The NSE chief also welcomed the fiscal management proposals presented by Finance Minister Nirmala Sitharaman in the Budget. He said the budget aims to give a fillip to growth by committing higher investments with a 10% growth in the capital expenditure.

The proposals for reforms across taxation, the power sector, urban development, mining, agriculture, small businesses, and export units will help the growth process. The Budget places India in a strong position and will play an important role in achieving the objective of transforming into a developed country by 2047, he noted.

Dinker Vashisht, Vice President of Corporate Affairs—Swiggy

Dinker Vashisht said that the Centre’s decision to cover gig workers under health insurance through the PM Aarogya Yojana is a worthy one.

“Swiggy and several other platforms have been providing health and other forms of insurance to our delivery partners for the past several years under terms that align with some of the best international practices. We will await further details to understand how insurance can continue to be best provided while ensuring the interests of our delivery partners are well served,” he commented.

Richard McCallum, CEO – UK India Business Council

“I'm encouraged by the focus on economic growth, on invigorating private investment [because] we do need more private investment for growth to be sustainable, on skilling, and stimulating more consumer spending. We also welcome the focus on domains like tax administration and policy reform, urban development, energy security, and other regulatory reforms,” McCallum told PTI.

“More broadly, I noted that the finance minister talked about simplifying conditions linked to FDI. We have been long advocating for a simplification of conditionalities associated with foreign investment; there will be more FDI if foreign companies can optimally leverage the FDI caps that are in place,” said McCallum.

“I think there are other things about the Budget that I am optimistic about from a UK-India perspective. So, for example, in ease of doing business terms, the announcement about refreshing the model BIT [Bilateral Investment Treaty]—we would argue that needs to be rooted in investor protection, but I think that is a welcome step to encourage more FDI; also the high-level committee on regulatory reforms being set up,” he said.

“I also was very encouraged by the move towards a trust-based economic governance approach. I think that's a really positive step. The vast majority of businesses, institutions, and individuals are voluntarily compliant, and this sends a really positive message to investors about India,” he added.