Budget 2025: What’s Cheaper, What’s Costlier?

New Delhi: Finance Minister Nirmala Sitharaman presented her eighth consecutive Union Budget on Saturday, bringing her closer to the record set by former Prime Minister Morarji Desai, who presented 10 budgets across different terms. Sitharaman remains the first woman to serve as a full-time finance minister of India.

The Union Budget for the financial year 2025-26 marks the 14th consecutive budget under the Narendra Modi government since 2014.

What’s Cheaper?

Mobile Phones: 28 additional goods used in mobile phone battery production have been added to the exempted capital goods list, reducing costs in the sector. Medicines: The government has removed the Basic Customs Duty on 37 more medicines. Critical Drugs: 36 drugs used in the treatment of cancer and rare diseases are now exempted from Basic Customs Duty, making them more affordable. Raw Materials: Full exemption from Basic Customs Duty has been granted on cobalt products, LED, zinc, lithium-ion battery scrap, and 12 critical minerals. Shipbuilding: The exemption on raw materials for manufacturing ships has been extended for another 10 years. Handicrafts: A new scheme has been introduced to boost handicraft exports. Leather: Wet blue leather has been fully exempted from Basic Customs Duty, supporting the leather industry.

What’s Costlier?

Interactive Flat Panel Displays: The Basic Customs Duty has been increased from 10% to 20% to address the inverted duty structure, making these products more expensive.

Economic Growth Projections

The Economic Survey, presented in Parliament on Friday, projected India’s GDP growth to be between 6.3% and 6.8% for the financial year 2025-26.

The survey highlighted that India’s economic fundamentals remain strong due to a stable external account, fiscal discipline, and private consumption. The government aims to support long-term industrial growth through investments in research and development (R&D), micro, small, and medium enterprises (MSMEs), and capital goods.

Inflation and Food Prices

The survey also noted that food inflation is expected to decline in the last quarter of FY25 due to lower vegetable prices and the arrival of the Kharif harvest. A strong Rabi harvest may further help stabilize food prices in early FY26. However, inflation risks remain due to uncertain weather conditions and rising global agricultural prices.