Sat Feb 01 12:58:50 IST 2025: ## India’s Union Budget Prioritizes Debt Reduction and Social Spending
**NEW DELHI, February 1, 2025** – Finance Minister Nirmala Sitharaman today presented India’s Union Budget for 2025-26, the second since the NDA’s third consecutive electoral victory. The budget reveals a continued reliance on borrowings and other liabilities as the primary source of revenue, contributing 24% of the total (down from 27% last year). Income tax follows closely at 22% (up from 19%), with GST and other taxes contributing a consistent 18%. Corporation tax also remains a significant contributor at 17%.
The budget allocates 22% of funds towards states’ share of taxes and duties (slightly up from 21% last year), followed by 20% for interest payments. Central sector schemes receive 16%, while the Finance Commission, defence, and centrally sponsored schemes each receive approximately 8%. Subsidies account for 6% of the budget, with pensions and miscellaneous expenditures each taking up 4% and 8%, respectively.
The budget demonstrates a focus on fiscal consolidation, reducing reliance on borrowings while maintaining significant allocations for key social programs and essential services.
First Piper 