Live: Indian Union Budget 2025
Summary
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For more highlights on key sectors visit:
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Lifesciences
Hitesh Sharma , Partner and Lifesciences Leader – Tax, EY India
The Budget 2025 provides a positive outlook for India’s Health Science sector, with measures aimed at improving healthcare access and infrastructure. A key provision is the basic customs duty exemption on 36 life-saving drugs for rare diseases, cancer, and chronic conditions, as well as bulk drugs used for manufacturing them. Additionally, 37 more specified drugs and 13 new Patient Assistance Programs (PAPs) have been added, enabling pharma companies to expand coverage for more patients across India. The overall healthcare allocation has increased by 11%, showing the government’s commitment to the sector. ?The government plans to establish Day Care Cancer Centres in district hospitals, with a goal of setting up 200 centres in the current year. There will also be an addition of 10,000 new medical seats, with plans to increase this to 75,000 over the next five years. The PM Research Fellowship scheme will provide 10,000 fellowships to drive technological research at IITs and IISc. The promotion of Medical Tourism and the ‘Heal in India’ campaign, along with a INR 20,000 crore initiative for private-sector-led R&D, will further boost the sector. Overall, the Budget 2025 continues the positive path for healthcare innovation and infrastructure growth in India.
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Auto
Saurabh Agarwal , Partner & Automotive Tax Leader, EY India
The proposed income tax cuts could boost the middle class's spending power, potentially increasing demand for two-wheelers, three-wheelers, and small cars. Further, the government's commitment to fostering a sustainable automotive ecosystem is clearly demonstrated through its strategic initiatives, which are poised to deliver substantial benefits to the electric vehicle (EV) industry. The budget astutely emphasizes the complete exemption of Basic Customs Duty (BCD) on cobalt powder and waste, scrap of lithium-ion battery, lead, zinc, zirconium, copper, etc. These pivotal measures are designed to ensure a reliable domestic supply of essential critical minerals for manufacturing and to stimulate job creation across India. Building on this commitment, the government has significantly increased budgetary allocations, with PME E-DRIVE receiving INR 4,000 Crores, Auto PLI being bolstered by INR 2,218 Crores, and ACC PLI benefiting from an infusion of INR 155 Crores. Since, there is no significant new funding for the SMEC next year (showcasing muted interest in the scheme by the industry), the government may consider rolling out additional incentives in the form of PLI 2.0 (like other sectors) to maintain growth in domestic EV manufacturing, targeting new entrants and startups. In a concerted effort to promote self-reliance in manufacturing, the government has proposed the exemption of 35 specific capital goods and machinery from BCD, which will promote production of lithium-ion batteries for EVs. These enhanced investments and rate rationalization underscore the government's dedication to advancing the green automotive ecosystem, thereby reinforcing India's position in the global EV market.?
Financial Services (2)
Pratik Shah, Financial Services Leader, EY India
A Game Changer announcement is the set-up of Bharat Trade Net (BTN) - A digital platform for international trade. With the objective of streamlining trade documentation and trade financing, BTN will:
As the latest addition to Digital Public Infrastructure (DPI) under India Stack 2.0, Bharat Trade Net (BTN) will digitize International Trade through integration of Customs, DGFT, GSTN, Banks and Exporters. It will complement Unified Logistics Interface Platform (ULIP) and will operate alongside OCEN, ONDC, UPI and other DPI components to create a truly paperless ecosystem; thereby transforming the way Indian businesses undertake global trade.
In addition to BTN, the announcement of following initiatives is indeed going to give a big boost to India's aspiration of USD 2Tn Exports by 2030:
Exports Promotion Mission
Domestic Manufacturing Support
Oil and Gas
Vinayek Neetu , Partner – Tax Leader Infrastructure and Oil & Gas, EY India
With continuing geopolitical headwinds suggesting lower economic growth over the mid-term, allocation of Rs. 5,697 crores towards building of crude oil reserve is a positive step. With import of crude still showing an upward trend, the government is on a steady path to create green energy infrastructure by announcing full exemption of BCD for critical minerals and certain capital goods used in battery manufacturing, revised BCD rates applicable to goods used in generating renewable energy. While there were industry expectations, there was no mention of transitioning natural gas and aviation fuel to GST. The economic survey has acknowledged the need for regulatory reforms to foster ease of doing business in India and recent approval by Rajya Sabha (awaiting approval from Lok Sabha) on Oilfields (Regulation and Development) Amendment Bill, 2024 is a step towards that.
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Technology, Media and Telecommunications
Vishal Malhotra , Partner and National Tax leader, EY India
India’s Union Budget 2025 demonstrates the government’s commitment to foster economic growth by fiscal and tax policy reforms. Giving the slowing economy, there was a need to spur urban consumption which is proposed to be achieved by imposing 'Nil tax” on individuals earning up to ?12 lakh annually. To aid enhanced compliance, the government plans to replace the existing six-decade old income tax law with a simpler version. This new law aims to reduce complexity and volume, operating on the principle of "trust first, scrutinise later”.?A sincere attempt also is being made to do away with and/or simplify redundant non fiscal compliances. ?TDS provisions simplifications is on expected lines and will again significantly ease compliance. ?For the first time in the history of Indian tax assessments, block assessment for three years has been introduced at the option of taxpayer for transfer pricing related issues.?In addition to tax reforms, the budget includes measures to support the agriculture sector, travel and tourism industry and the gig economy. The government will launch a nationwide program to promote high-yielding crops and increase subsidized credit limits for farmers. Gig workers will be formally registered and provided with identity cards and access to welfare initiatives. Some other significant steps include promotion of manufacturing of sustainable energy products as also development of India as a toy making hub of the world. Focus on education - broadband connectivity for secondary schools in rural areas and recognition of AI as a game changer and skill development in this area should help in employability of our youth. ?The budget focuses on developing the top 50 tourist sites in the country in partnership with states, aiming to generate employment and showcase India’s cultural heritage.
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FDI – Insurance?
Keyur Shah , Partner and Tax leader – Financial Services, EY India
The proposal announced by the Finance minister to allow 100 percent FDI in the insurance sector (currently restricted to 74%) could be a game changer.? Having said that, she did mention that this would be subject to conditionalities to be prescribed and the insurance company getting the 100 percent FDI does not invest its premiums outside India.? One does hope that these conditions do not inhibit the FDI investment perse.? So far only few companies have seen FDI increase to 74 percent. Also As expected, one did see a fair bit of announcements around IFSCA – though some of them were in the shape of extension of time limits.? One interesting proposal relates to the income tax exemption to non resident investors in any unit in the IFSCA (not only banks) from transfer of non deliverable forwards, offshore derivative instruments or over the counter derivatives.? Including any distribution of income arising from these instruments. This should incentivise funds here to issuing such instruments from other offshore locations to move base to IFSCA.
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Real Estate
Vinayek Neetu , Partner and Tax Leader - Infra, EY India
The contribution of Real Estate sector towards vision of VB@2047 requires investment though funds and deployment of innovative measures to remove bottlenecks for the growth of the sector. Launch of SWAMIH Fund 2 promises to fast-track affordable housing for the upliftment of middle class in nation building; the initiative of National Geospatial Mission to develop foundational geospatial infrastructure and data shall help in transforming land management and infrastructure planning and push further investment by developers and investors. Tax measures, such as extending tax relief for two self-occupied properties (currently restricted to one) and increasing monetary threshold for non-deduction of TDS on rent, are positive incentives for individuals and will boost middle-class spent in real estate investments.
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Infrastructure
Vinayek Neetu , Partner and Tax leader- Infra, EY India
Investment in infrastructure is a part of one the four powerful engines towards destination of Viksit Bharat@2047. With the budgetary allocation of Rs. 11.21 lakh crore towards capital expenditure the government continues its promise of accelerated growth and inclusive development. Requirement of each infrastructure related ministry coming up with a three-year pipeline of projects to be implemented in PPP mode, an outlay of Rs. 1.5 lakh crore with interest free loan for 50 years to states for capex and incentives for reforms are initiatives which will invigorate private sector investments. Allocation of Rs. 25,000 crore to the Maritime Development Fund with equal participation from private sector will facilitate long-term financing to the maritime sector. Revamping the shipbuilding financial assistance policy and inclusion of large ships in the harmonized list of infrastructure are positive measures towards ship building ecosystem. Tax measures such as granting benefit of tonnage tax schemes to inland vessels, extension of time limit to commence business in IFSC for ship and aircraft leasing will give further boost to sector. Additionally, the much expected extension of time limit up to 2030 for making investments by sovereign and pension funds will attract non-public capital investment in infrastructure projects. Setting up of an urban challenge fund of Rs. 1 lakh crore for economic and transit planning and redevelopment of peri-urban areas will help transform the cities as growth hubs.
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Transfer Pricing
Vijay Iyer , Partner and National Leader Transfer Pricing, EY India
Union Budget 2025 clearly shows the commitment of the government to encourage the private sector to contribute more towards India’s Growth Plans. Private businesses, both Indian headquartered multinationals and foreign companies need to actively invest in India and since their businesses are spread across many countries, transfer pricing becomes a relevant issue in their tax compliance and hence in their investment decisions. The government has embarked on a journey to ease the compliance burden for these companies in the budget by bringing in a regime of block assessments in transfer pricing giving the option to the taxpayer to get 3 years of TP assessments completed for identified transactions at one go, thereby reducing the compliance burden. The Honourable Finance Minister also announced that they would be coming up with revised safe harbour rules soon and these rules might reduce the TP compliance burden for taxpayers.? Apart from compliance costs, taxpayers suffer from a lot of cost due to prolonged tax litigation. Therefore,?mechanics to prevent disputes through safe harbour rules are very welcome and other forums like Advance Pricing Agreements?and Mutual Agreement Procedures and domestic Dispute Resolution Forum need to be continuously strengthened and improved to provide more ease to taxpayers to do business in India.
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Startup
KT Chandy , Partner and Private Tax Co-leader, EY India
The Budget proposes a multi-pronged approach to support the start-up sector. Recognizing the need to maintain the flow of investments into the start-up sector, a new Fund-of-Funds focussed on start-ups has been announced, with a Rs 10,000 crore contribution from the Government.? In addition, a deep-tech focussed Fund-of-Funds is being explored.? The coverage of the credit guarantee cover scheme for start-ups is now available for up to Rs 20 crore, which would improve access to credit. To build technology skillsets which are vital for high-tech industries, proposals have been introduced to increase capacity at IITs; 10,000 research fellowships at IITs and IISc have also been announced. The tax holiday for startups has now been extended to cover startups that would be incorporated up to 31 March 2030.?? The TDS and TCS provisions have been rationalized, which will reduce compliance burden.? Changes are proposed to the transfer pricing regime, which will improve certainty and reduce litigation. ?A simpler and more concise Income Tax legislation is also on the anvil, which has the potential to simplify tax compliance and reduce litigation.? It has also been proposed to set-up a high-level committee to rationalize and simplify regulations.? These measures would improve the ease of doing business, which is especially important for start-ups. ?These initiatives will continue to support India’s position as a premier hub for start-ups and innovation.
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Startups?
Prashant K Singhal , Emerging Market Leader, EY India
“India's 2025 budget isn't just about numbers, it's about accelerating the startup revolution. The government is betting big on young innovators, particularly in crucial sectors like deep tech with establishment of 3 AI Centres of Excellence. The new ?10,000 crore Fund of Funds will fuel early-stage startups across various sectors and enhanced credit guarantees will ease the funding crunch for small players. The government also addressed inclusivity with loans for minority women entrepreneurs and healthcare access for ~10 million online-platform workers through PM-JAY - a stepping stone toward recognizing the vital role of the gig economy. The personal income tax relief could have a ripple effect on consumption, benefiting various sectors and contributing to overall economic growth. With the? proposed simplification of tax regime and the 5-year extension for new startups till 2030 with a tax exemption for 3 years, the message is clear – India is open to business. The Budget accelerates the transition to 'Modern Bharat’, fuelled by homegrown innovation.”
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Telecom
Prashant K Singhal , Markets Leader and Telecommunications Sector Leader, EY India
“The Union Budget 2025 has laid significant importance to developing the digital infrastructure in the country. Bharatnet allocation has been substantially increased by 238% y-o-y to INR22,000 crores in FY26. This is expected to boost high-speed internet access in rural areas, especially with all government-run secondary schools and primary healthcare centres (PHCs) being covered under the scheme. In addition, local handset manufacturing is expected to get a boost, with removal of BCD of 2.5% on inputs or parts/sub-parts of specific components. With 330 million mobile handsets produced in India in FY24 amounting to INR4.4 lakh core, the move would likely to make handsets cheaper. Further, rationalization of BCD on carrier grade Ethernet switches from 20% to 10% and bringing it at par with non-carrier-grade Ethernet switches is likely to reduce disputes and litigation owing to classification. The reduction of customs duty on carrier-grade Ethernet switches is expected to lower costs and accelerate the deployment of high-speed networks boosting enterprise communication and data center connectivity. Another interesting point to note is that there is a reduction in the FY26 Budget Receipt for the telecoms sector by 33% as compared to FY25. This potentially indicates lower spectrum usage charges and one-time spectrum fees to be paid by operators. Since operators have sufficient 4G and 5G spectrum, spectrum auction is unlikely?in?FY26.”
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Sameer Gupta , National Tax Leader, EY India
“Budget 2025 lays a strong foundation for India's growth by putting people at the center of economic progress, fostering innovation, and strengthening the manufacturing ecosystem. The government’s push to make India a global hub for manufacturing signals a transformative shift—boosting employment, encouraging local enterprises, and fostering cutting-edge technology to create high-quality, sustainable products. The aim is to establish India as a powerhouse with a robust manufacturing ecosystem renowned for quality, thereby driving growth and innovation in high-potential industries. For individuals, the budget delivers a significant relief with enhanced tax rebates, ensuring more disposable income, stimulating consumption, and fuelling economic activity. Innovation takes center stage across sectors, with forward-looking policies supporting agricultural resilience, skill development, and digital transformation. From targeted agri-districts to a revitalized India Post serving as a rural economic catalyst, the emphasis is on sustainable, technology-driven progress. The Finance Minister’s announcement of the new Direct Tax Bill being presented next week, is a fulfilment of last year’s promise for a simplified tax code to enhance certainty, where tax would play a key role in improving the ease of doing business in India.
Economic Development
Adil Zaidi , Partner and Leader - Economic Development Advisory, EY India
"The Budget 2025-26 lays the groundwork for India’s emergence as a global manufacturing and innovation powerhouse, backed by regulatory reforms, supply chain integration, and sustainability-driven growth. The ?20,000 crore allocation for private sector led Research, Development, and Innovation and the additional ?10,000 crore Fund of Funds will accelerate deep-tech startups, but maximizing impact requires stronger collaboration between industry, academia, and government. The ?500 crore AI Centre of Excellence will further India’s leadership in next-gen technology. Structural reforms, including the High-Level Committee for Regulatory Reforms and customs tariff rationalization, Export Promotion Mission and BharatTradeNet will enhance ease of doing business, boost exports, and simplify compliance. Investments in air cargo warehousing for high-value perishable exports and the National Framework for Global Capability Centres (GCCs) will strengthen logistics and unlock tier-2 cities as service hubs. The National Geospatial Mission and PM Gati Shakti will modernize land records and infrastructure planning, unlocking new investment potential. Key sectoral measures—MSME credit expansion, ?30,000 UPI-linked credit cards, and targeted support for footwear, leather, and toys—will drive employment and entrepreneurship. Clean-tech investments in EV batteries, solar PV, and electrolyzers will strengthen domestic value chains. However, success hinges on efficient execution, policy stability, and global integration, ensuring India’s long-term economic resilience and competitiveness."
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Economy
DK Srivastava , Chief Policy Advisor, EY India
“Fiscal stimulus has been introduced in the FY26 budget through three main routes: (1) additional disposable income to the extent of nearly INR1.03 lakh crores through foregone direct and indirect taxes, (2) Government of India’s capital expenditure growth budgeted at 10.1% and (3) a facility for state governments to borrow interest free loans to the extent of INR1.5 lakh crore for infrastructure investment. This stimulus is limited in terms of magnitude and would prove to be effective along with other fiscal and monetary measures aimed at stimulating private investment. In particular, some realignment of customs duty tariff for making several inputs cheaper through zero or concessional basic customs duties may lead to addition in domestic manufacturing capacity.”
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AI
Rajnish Gupta , Partner, Tax and Economic Policy Group, EY India
“The budget underscores the commitment of the Government of India to promote AI.? In addition to the specific proposal namely setting up a Centre of Excellence in Artificial Intelligence for education will be set up with a total outlay of ` 500 crore, announcements with regards to Deep Tech Fund of Funds for next generation start-ups and PM Research Fellowship that will provide ten thousand fellowships for technological research in IITs and IISc will help entrepreneurs and researchers.
The budget announcements have been supplemented by significant announcements of the Government with regard to development of domestic AI models and early availability GPUs and operationalising of AI India data platform. Government of India initiatives together with the recent developments that bring down the cost of AI and availability of open-source models augur well for the future of AI in India.”
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Consumer Products and Retail
Angshuman Bhattacharya , Partner and National Leader - Consumer Product and Retail Sector, EY-Parthenon
“The budget seems to be focused on important pillars like driving middle class purchasing power to drive back growth in consumption, accelerating the Aatmanirbhar Bharat agenda to indigenize production and value capture in the profit pools for India driving employment and value-added manufacturing growth - and important steps towards furthering energy efficiency and power self-sufficiency. Income tax and rental slabs reorientation will go a long way in improving consumer confidence - electric vehicles and lithium carbonate batteries indigenization will promote a vibrant ecosystem for a domestic ecosystem and investments in nuclear power are all steps towards building the right foundations of investment led growth”
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Urban Development
Adil Zaidi , Partner and Leader - Economic Development Advisory, EY India
领英推荐
“Budget 2025-26 envisions cities as engines of innovation, resilience, and equitable growth, backed by a ?1 lakh crore Urban Challenge Fund and a ?1.5 lakh crore, 50-year interest-free loan for state capital expenditure. However, implementation is key—strengthening municipal capacity, integrated urban planning, and public-private collaboration will determine success. The asset monetization plan must prioritize reinvesting proceeds into affordable housing, climate-resilient infrastructure, and better municipal services to ensure inclusive growth. Regulatory reforms in urban land use and governance will be crucial in unlocking land value and driving investment efficiency. For cities to truly thrive, liveability, sustainability, and economic productivity must guide urban planning. Strengthening local governance, enabling citizen participation, and scaling smart, green solutions will position Indian cities as global models for sustainable urbanization.”
?GCC
Arindam Sen , Partner and GCC sector leader (TMT), EY India
The government's initiative to formulate a national framework for Global Capability Centres (GCCs) in emerging Tier 2 cities is a significant step forward. Cities like Jaipur, Vadodara, Coimbatore, and Kochi are quickly becoming popular alternatives to metro cities, with GCC leaders increasingly considering these locations for expansion. The framework will provide guidance to states on enhancing talent availability, improving infrastructure, and fostering collaboration with the industry.. Additionally, the Rs 500 crore allocation to AI Centres of Excellence further reinforces the government's commitment to strengthening India’s position as a global technology leader.
Public Healthcare
Satyam Shivam Sundaram , Partner, Strategy & Transactions, Govt Advisory Services, EY India
“The budget announcement heralds a significant boost to India’s healthcare sector. The decision to add 10,000 seats per year—an increase of nearly 5% of the current capacity—will help improve the doctor-patient ratio and make both secondary and tertiary care more accessible and affordable. Every additional seat also translates to the addition of four beds to the medical college and hospital. In five years, this initiative would add 300,000 more beds, nearly one-third of the current capacity in the public sector. The government may consider expanding existing medical colleges wherever possible to optimize expenditure. India has nearly 100 cancer cases per 100,000 people, which, in relative terms, might be lower than in many countries like the U.S., which reports more than 300 cases per 100,000. However, in absolute numbers, the burden is very high given India’s large population. The establishment of 200 daycare centers will strengthen cancer care infrastructure, reducing mortality rates and improving patient outcomes. The impact would be even greater if screening infrastructure is strengthened and care pathways are well-defined.”
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AI, GCC
Rohan Sachdev , National Leader, Consulting Services, EY India
“Exciting times ahead as India Budget 2025 focus on People and Innovation. Earmarking ?500 crore for three AI Centres of Excellence, is set to transform our educational landscape. These hubs will not only foster advanced AI research but also develop AI-enabled tools for a personalized and impactful learning experience. Collaboration with top-tier institutions and industry leaders will pave the way for AI models that enhance learning, from automated assessments to intelligent tutoring systems. The potential impact on equipping students with future-ready skills is immense. In addition, the ?20,000 crore Deep Tech Fund promises to catalyze private-sector R&D, ensuring that India remains at the forefront of innovation. Amidst these developments, the Finance Bill's clear stance on cryptocurrency transactions, GCCs in Tier-2 Cities, underscores our commitment to a progressive futuristic economy, fostering trust, innovation and stability in this emerging sector.”
Education
Amitabh Jhingan , Partner, EY-Parthenon India and EY Global Education Sector Leader
“Budget 2025 has called out Education and Skilling as a key area of Investment rather than Expenditure which recognises the transformative potential of human capital in India.? Announcements around strengthening the Anganwadi program and Poshan 2.0, expanding capacity of IITs and Medical colleges, setting up world class skilling centres and creating a centre of excellence for AI in Education provide a balanced approach towards transforming education in India. The increase in allocation for education to 1.28 lakh cr also indicates a clear intent to invest in the future of the youth in India and build. a strong platform for Atmanirbhar Bharat.”
Power & Utilities
Somesh Kumar , Partner & Leader - Power & Utilities, EY India
“The Union Budget 2025 lays a strong foundation for India’s power sector, driving domestic manufacturing, energy security, and financial reforms. The new Make in India manufacturing mission will strengthen the domestic value chain for solar PV, EV batteries, electrolysis, wind turbines, and high-voltage transmission equipment, reducing import dependence and enhancing global competitiveness. Power sector reforms will incentivize electricity distribution improvements and intrastate transmission capacity augmentation, improving the financial health of DISCOMs. States implementing these reforms will benefit from an additional 0.5% of GSDP borrowing capacity, ensuring better infrastructure and efficiency. The 100GW Nuclear Energy Mission by 2047 is a landmark initiative, fostering private sector participation and R&D in modular reactors to deploy 20 modular nuclear plants by 2033. Amendments to the Atomic Energy Act and a ?20,000 crore investment will drive its execution. Additionally, custom duty exemptions on critical minerals like cobalt, lithium-ion battery waste, lead, zinc, and 12 more minerals, along with 35 new capital goods for EV battery manufacturing and 29 additional goods for mobile phone battery production, will boost domestic manufacturing and investment in energy storage solutions.”
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Energy
Raju Kumar , Partner and Energy Tax Leader, EY India
“The Budget reinforces India’s energy transition by prioritizing domestic clean-tech manufacturing, power sector reforms, and electric mobility. The National Manufacturing Mission for Clean Tech is a crucial step in reducing import dependence for solar PV cells, wind turbines, and battery storage, supporting India’s goal of energy self-sufficiency. Lower customs duties on solar modules, lithium-ion battery waste, and critical minerals will enhance cost competitiveness and encourage local manufacturing. The Nuclear Energy Mission, targeting 100 GW by 2047, is a game-changer, as nuclear can provide round-the-clock clean power. However, the success of private sector participation, facilitated by proposed amendments to the Atomic Energy Act, will depend on clear regulatory frameworks and risk-sharing mechanisms. The investment in Small Modular Reactors (SMRs) with an outlay of INR 20,000 crores is a forward-looking step, with the potential to enhance energy security. For the power sector, linking borrowings to state GSDP is a strategic move with plans to incentivize electricity distribution reforms and augmentation of intra-state transmission capacity by states.? The Budget also supports EV adoption, with duty exemptions on EV battery manufacturing equipment and reductions in import duties on EV components and commercial transport vehicles, which will accelerate the shift to sustainable mobility. The energy sector now has clear policy direction powered by fiscal incentives; execution and private sector participation will define its success.”
Gig Workers
Veenu Jaichand , Partner - Skill Development, Employment & Entrepreneurship, EY India
"The government’s initiative to provide identity cards and healthcare coverage for gig workers marks a positive step forward in recognizing this crucial segment of the workforce. This move not only ensures better access to medical benefits but also acknowledges the contributions of gig workers to the economy. However, to truly empower gig workers, it is essential to build on this foundation by expanding the social security framework and improving working conditions. Introducing contributory benefits such as pensions, provident funds, and unemployment insurance will offer gig workers long-term financial security. Moreover, addressing issues like fair pay, job security, and safe working environments will ensure that gig workers are not only supported in times of health crisis but also in their day-to-day work life and beyond."
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Women SC-ST entrepreneurs
Veenu Jaichand , Partner - Skill Development, Employment & Entrepreneurship, EY India
"The provision of term loans up to ?2 crore for women and SC-ST first-time entrepreneurs in the Union Budget 2025 is a commendable step in providing financial impetus to aspiring entrepreneurs from marginalized communities. This funding will undoubtedly help address the barriers to entry for many. However, to ensure long-term sustainability, it is crucial that this initiative is accompanied by continuous enablement, mentorship, and a focused approach to market linkages. By offering guidance on business strategy, operational support, and access to markets, we can equip these entrepreneurs with the tools to thrive. Only with these complementary actions will the funding become a true enabler of growth and economic independence for these communities."
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Consumer Products and Retail
Paresh Parekh , Partner and Retail Tax Leader, EY India
“1 lac crores of personal tax forgone is almost 6% to 8% of total collection. It is a quite significant and "more than expected" and a decently large infusion of liquidity / disposable income in the hands of consumers and tax - payers. This should positively impact urban consumption. Employment and manufacturing push is also attempted through "Make in India” reforms, agriculture reforms, MSME support, export push, inverted duty rectifications, etc. Sectors such as footwear, food processing, leather, and toys get specific manufacturing push. Tax holiday for eligible “Start-ups” has been extended for 5 years for all new start-ups incorporated till March 31, 2030. Extending tax benefits under Section 80-IAC until 2030 will encourage new ventures and attract more investments. This will boost innovation, job creation, and strengthen India’s position as a global start-up hub.”?
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Skill Development
Harish Porwal , Partner Skill Development & Entrepreneurship, EY India
“The Budget 2025 sets a transformative vision by embedding skill development as the backbone of India’s economic progress. Recognizing the vital role of a skilled workforce in enhancing agricultural productivity, food processing, shipbuilding, logistics, and tourism, the Government is committed to developing specialized competencies that drive value addition and innovation. New institutions such as NIFTEM Bihar and five National Centres of Excellence will catalyze sector-specific training, ensuring advanced proficiency across emerging industries. From modernizing India Post’s logistics capabilities to nurturing global expertise in toy manufacturing and marine engineering, these initiatives emphasize a deep, sustained investment in skilling. By aligning comprehensive training programs with evolving market demands, this initiative will empower women, youth, and other underserved groups, contributing to a skilled Bharat that underpins productivity, growth, and enduring prosperity. This initiative fuels prosperity for all."
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Financial Services
Pratik Shah , Financial Services Leader, EY India
“Simplifying KYC processes is a step in the right direction that will help streamline and bring down costs of customer acquisition significantly. The 100% FDI limit in insurance will open doors for foreign players who, with their knowhow of products, can foster deeper market penetration. NaBFID's impact on infrastructure financing is pivotal, addressing a longstanding gap where many organizations lacked internal capacity for underwriting such projects. NaBFID's partial credit guarantees, will help create fillip in infrastructure financing space. Moreover, the launch of the Digital Public Infrastructure (DPI) will be transformative for trade and supply chain finance, acting as a digital enabler similar to UPI. This shift will dramatically reduce costs, accelerate transaction speed, and unlock strategic opportunities to capitalize on the rapidly evolving trade finance landscape.”
Energy and Sustainability
Heena Khushalani , Partner - Climate change and Sustainability Services,?EY?India
“The 2025 budget announcement is certainly aimed at integrating the government's green agenda alongside India's robust growth. The clear focus to support cleantech manufacturing incl. support to lithium-ion batteries is a welcome move to reduce our dependency on exports. The National Nuclear Mission outlay of 20k crore alongside private sector participation will certainly bolster India's energy transition. The budget also has a good focus on boosting climate resilience and agricultural productivity, fisheries and these are all measures required to support the sustainable growth of rural India. While the budget does show the government's commitment towards sustainable growth, an enhanced focus on adaptation financing and climate finance taxonomy is required/have been amiss to boost sustainable finance would be necessary.”
Insurance
Shruti Agarwal Ladwa , Partner and Insurance Leader, EY India
“Increasing the FDI limit to 100% is a significant step towards attracting foreign investment, boosting competition, and fostering innovation within the sector. This move could lead to a wider range of diverse and affordable insurance options for Indian consumers, ultimately improving both choice and coverage quality.”
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Indirect Tax
Divyesh Lapsiwala , Tax Partner, EY India
“Customs rate changes are focused to (1) promote atmanirbhar bharat agenda?(2) rationalise rates (3) provided targeted support to identified industries.? Positive changes for Medical, Minerals, Textiles, Electronics, Shipping, Telecom and Auto sectors. Customs framework now allows payment/ refund claim of differential duty post clearances - easing compliances and reducing litigation/ additional proceedings due to errors and omissions. Customs also now provides for closure of provisional assessments within 2 years - a strong step towards providing closure of process. GST changes are aligned to those approved by the GST Council in December 2024. Thrust on automation continues by creation of creation of ‘Bharat Trade Net’, a digital public infrastructure initiative for international trade, and incorporating 'Invoice Management System' under GST.”
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Safari Retreat
Saurabh Agarwal , Tax Partner, EY India
“The Union Budget has formalized the amendment to Section 17(5)(d) of the CGST Act by replacing ‘plant or machinery’ with ‘plant and machinery,’ retrospectively effective from July 1, 2017. This change codifies the government's intent to restrict input tax credit (ITC) on construction costs and directly overturns the Supreme Court's ruling in the Safari Retreats case. The insertion of a clarificatory explanation reinforces the retrospective nature of this restriction, despite contrary judicial pronouncements. The move is expected to impact industries relying on ITC for infrastructure development, such as real estate, warehousing, and leasing. Given the history of legal scrutiny on retrospective amendments, this change could face constitutional challenges in the courts.
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1:20pm
Personal Tax
Sonu I. National Leader, People Advisory Services, EY India
“Dream budget for all with a big bonanza for low income and middle-income taxpayers with generous changes in tax slabs. The Finance Minister has focused on boosting consumption by putting more money in the hands of people. Budget 2025 focused on personal income tax payers’ delight. A salary income earner with total income of up to INR 12.75 lakhs will not pay any tax thanks to the increase in tax rebate from INR 25000 to INR 60000. Point to note that where income is taxable at special rates such as Capital Gains then this tax rebate will not apply. One lever for economic revival used well and the other lever on Cap expenditure is lower than expected but that can be made up through disciplined and accountable execution of the Budget.”
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Manufacturing
Saurabh Agarwal , Tax Partner, EY India
“The government’s initiative to establish India as a global hub for toy manufacturing is expected to bring a strategic boost to the sector, aligning with the broader vision of "Atmanirbhar Bharat" and "Make in India." By fostering dedicated toy clusters, skill development programs, and a well-integrated manufacturing ecosystem, the scheme aims to promote the production of high-quality, innovative, and sustainable toys that reflect Indian heritage and craftsmanship. With a strong focus on employment generation, exports, and attracting investments, the scheme is likely to offer incentives such as financial support, infrastructure development, etc. to domestic manufacturers. This will encourage local MSMEs and large-scale industries to scale up production, adopt cutting-edge technology, and enhance global competitiveness. Additionally, the initiative could facilitate partnerships between Indian toy makers and global brands, boosting the sector’s presence in international markets. By ensuring quality control and sustainability, the scheme is expected to position Indian-made toys as a credible and preferred choice for consumers worldwide, reducing reliance on imports and strengthening India’s standing in the global toy industry.”
AI and DeepTech:
Mahesh Makhija , Technology Consulting Leader, EY India
“India’s commitment to AI-driven innovation has taken a significant leap with the establishment of three AI Centres of Excellence, coupled with ?20,000 crore Deep Tech Fund. By fostering advanced research, AI-enabled learning tools, and industry-academia partnerships, we are equipping the next generation with the skills needed to drive transformative change. This as a pivotal moment as we close the AI talent gap, ensuring that India is not just a consumer of AI but a creator of cutting-edge solutions. The collaboration between the private sector, premier educational institutions, and research bodies will accelerate the development of AI models tailored for education—bringing personalised learning, automated assessments, and AI-powered tutoring systems into the mainstream.”
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12:50pm
Agriculture
Amit Vatsyayan , Leader - Agriculture, Livelihood, Social and Skills, EY India
“Government’s vision of targeted development of agri-districts with PM Dhan Dhanya Krishi Yojana, and the launch of national missions for high-yield seeds, fruits, and vegetables underscore a strong commitment to agricultural resilience. To maximize impact, integrating these initiatives with skilling programs for farmers, agri-entrepreneurs, and Farmer Producer Organizations (FPOs) is crucial, ensuring they can effectively adopt new technologies and sustainable practices.
?With India ranking second globally in fishery products, a structured policy framework for sustainable fisheries is both timely and essential. Beyond infrastructure and regulatory clarity, building skills in value-added processing and exports can unlock greater economic potential. Likewise, the cotton productivity mission must integrate precision farming, digital advisory services, and supply chain optimization to drive long-term gains.
?Repositioning India Post as a rural economic catalyst and a large-scale public sector logistics player is a transformative move. Its vast network can bridge critical supply chain gaps for MSMEs, agri-entrepreneurs, and rural artisans. Investing in last-mile delivery technology and upskilling the workforce in digital and logistics management will be key to unlocking its full potential and driving inclusive?growth.”
Aashish Kasad , National Leader - Chemicals and Agriculture sector, EY India
The 2025 Budget has underscored Agriculture as one of the power engines, unveiling a series of policies and financial plans for the sector, aimed at reaching the objective of Viksit Bharat. It presents a detailed approach to improving agricultural performance and stability, creating avenues for employment and skills training, promoting the progress of women, boosting digital and technological skills, stimulating innovation, extending infrastructure, and increasing the availability of credit to farmers, while also providing for self-sufficiency and a consumption-led growth, enabling a holistically healthy India. Full marks for this Budget”
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9:00 a.m.
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