Ahead of the presentation of India’s 2025-26 Union Budget, Prime Minister Narendra Modi has hinted at provisions aimed specifically at benefiting the poor and middle classes. On Friday, the Prime Minister invoked the Hindu goddess Lakshmi, traditionally associated with wealth, expressing hope that she would shower her blessings on these groups. His remarks suggest that the upcoming budget could include measures designed to ease financial strain and offer relief to these constituencies.
While Modi’s statement was framed with reverence and optimism, it also included a note of caution, stressing the importance of fiscal prudence. This balancing act will be crucial as the government looks to address the needs of the underprivileged and middle-income groups while keeping its financial goals intact.
Income tax adjustments are likely to be a key focus of the Budget, particularly as the middle class has expressed growing concerns over stagnant tax slabs. With inflation pushing up the cost of living, tax brackets have effectively shrunk, putting more pressure on middle-income families. This has led to calls for changes in tax rates or the introduction of new tax relief measures. Since 2020, India’s income tax slabs have largely remained unchanged, and the new Budget could potentially address this issue to alleviate the financial burden on citizens.
India’s economic growth has also slowed, with projections indicating a drop from 8.2% in 2023-24 to 6.4% in 2024-25. In response, there is growing pressure on the government to implement policy measures that will stimulate consumption and boost economic recovery. Modi’s emphasis on a “prudent” approach suggests that any potential relief for the poor and middle class will be carefully calibrated to ensure fiscal responsibility while stimulating growth.
There is also speculation that the government may introduce or restore welfare measures for the underprivileged. One possible move could be the reinstatement of LPG subsidies, a promise frequently made by the BJP during state elections. Other existing welfare initiatives, such as the PM-KISAN income support program or the PMAY (Pradhan Mantri Awas Yojana) housing scheme, could see expanded coverage or increased funding in a bid to support vulnerable sections of society.
However, the government will also need to strike a delicate balance between expanding social welfare programs and achieving its fiscal consolidation goals. Modi acknowledged this balance when he mentioned that Lakshmi’s blessings must be accompanied by prudent financial management. He assured the nation that the upcoming Budget would instill new confidence and energy, positioning India on a path to becoming a “Viksit Bharat” or developed nation.
The Union Budget for 2025-26, set to be presented on Saturday, will follow the Economic Survey, which outlines the current state of India’s economy. With the government targeting India’s rise to the third-largest economy in the world by the end of Modi’s third term, this Budget will be critical in setting the tone for India’s economic future.
The Budget is expected to prioritize growth-oriented policies that encourage innovation, investment, and inclusion, ultimately aiming to revitalize the economy and drive the country towards its ambitious development goals.
