Budget 2025 Expectations: Budget session to take place in two phases; first phase begins from January 31

The Union Budget 2025 is poised to accelerate India's position as a global AI leader. Bharat Chadha, Partner, Tech Consulting, Uniqus Consultech, said that the Budget is expected to put in significant investments in AI research, focusing on indigenous large language models and AI chip development. “Comprehensive AI skilling initiatives targeting urban and tier-2/3 cities will prepare a future-ready workforce. Policies under "AI for Bharat" will likely prioritize healthcare, agriculture, and education, addressing India's unique challenges. The recently approved national AI mission, 'INDIAai,' aims to foster AI innovation and collaboration across academia, industry, and government. With evolving regulatory frameworks ensuring ethical AI use, tax incentives for AI hardware manufacturing and funding for AI startups will bolster the "Make in India" vision, propelling economic growth through technology-driven solutions,” he said.

With Finance Minister Nirmala Sitharaman highlighting that 2025 will be a pivotal year for significant policy measures aimed at driving India's economic growth, the year is being observed as the ‘Year of Reforms’. In terms of policies aimed towards the defence sector, Captain Nikunj Parashar, Founder of Sagar Defence Engineering, said that the sector is anticipating a key focus on enhancing military modernization and boosting Aatmanirbharta in defence. “As the nation continues to invest in its defence sector, there is anticipation for increased allocations for innovation and research to support advanced technologies, fostering a robust defense manufacturing ecosystem and new initiatives contributing to the sector. We look forward to the 2025 Budget aligning with the nation’s goals of strengthening its defence capabilities while fostering economic growth and innovation,” he said.

- India’s first Budget post-Independence was presented in November 1947, by RK Shanmukham Chetty.

- The Railway Budget was merged with the Union Budget in 2017-18.

- The Union Budget used to be earlier presented on the last working day of February.

- The Budget presentation date was changed to February 1 in 2017 under the tenure of Finance Minister Arun Jaitley. The change in date is aimed at streamlining the process and ensuring a timely presentation of the Budget.

- Traditionally, the Budget was presented on the final day of February at 5 pm, synchronized with London’s time zone. In 1999, Finance Minister Yashwant Singh of the Atal Bihari Vajpayee government changed the timing to 11 am.

The paint industry is optimistic that FM Nirmala Sitharaman would announce measures that will drive growth and sustainability. With the real estate industry poised for growth, the demand for decorative and industrial paints will expand. Even so, India’s per capita paint consumption remains lower as compared to developed nations, reflecting immense potential for market expansion. Kuldip Raina, Director of Sales and Marketing at Shalimar Paints, said, “New renovating trends, including shorter repainting cycles, are driving demand in the decorative paints segment, reflecting evolving consumer preferences and driving sustained market growth. Additionally, government schemes such as PMAY (Grameen) and increased spending on infrastructure projects will boost industrial paint demand, driven by economic growth and growing disposable incomes.”

Further, he added that reducing import duties is crucial for a sustained growth, given the industry's reliance on imported resins and chemicals.

Shalimar Paints also advocated for policies that stabilize raw material supply, encourage R&D through tax benefits, and provide subsidies for technological upgrades. These steps, Kuldip Raina said, will reduce production costs, lower energy expenses, and enable greater industry participation.

Further, he added that incentivizing export growth will enhance industry's global competitiveness and strengthen India's position in the international market. “Budget 2025 has the potential to be a turning point for the paint industry. With heightened investments in construction, including housing, cement, and steel, along with targeted fiscal policies, the industry looks for robust growth. These measures will not only support fiscal deficit reduction goals but also significantly contribute to India's economic development,” he concluded.

The fintech sector is optimistic about the government’s continued focus on promoting digital payments and strengthening financial inclusion. Commenting on expectations from the finance minister, Nalin Negi, CEO, BharatPe, said, “We hope this Budget will aim to address key areas such as easing regulatory frameworks, incentivizing digital adoption, and boosting credit access for MSMEs. Such steps will ensure that fintech remains a catalyst for India’s growth story and pave the way for a truly inclusive economy.”

According to economists, the starting point of the Budget will be the fiscal deficit and efforts will be made to lower the ratio by 0.5% to probably close to 4.3-4.4% of GDP for FY26. Within this framework, Madan Sabnavis, Chief Economist at Bank of Baroda., said that the Budget would work to maintain, if not increase capex, in the range of Rs 11 lakh crore that will provide a fillip to investment.

Further, he added that benefits for MSMEs and industry are also expected through the PLI scheme with probably a special dispensation for the former.

On the consumption front, he said, “It would be interesting to see if there are any special rebates offered on income tax given that consumption has been affected due to high inflation this year.”

Finance Minister Nirmala Sitharaman held the customary halwa ceremony on January 24, marking the final stage for the preparation of Budget 2025. The ceremony took place in the North Block basement.

Read more about the tradition and its significance.