India’s GDP growth for the second quarter of FY25 stood at 5.4 percent, driven by the slowdown caused by the Lok Sabha elections. However, the outlook for the third quarter is more optimistic, with a boost expected from festive spending. The government is also banking on the larger impact of new tax reforms to drive growth, with unprecedented income tax cuts designed to increase disposable income.

The newly introduced tax cuts benefit over 75 percent of salaried individuals, with people earning Rs. 10 lakh annually gaining an additional Rs. 50,000 in disposable income. Higher earners, such as those making Rs. 25 lakh, will see an additional Rs. 1.1 lakh. This leaves households with more spending power, which will likely be used for consumption, including food, FMCG products, and even big-ticket items like cars, improving both domestic demand and the government’s indirect tax revenue.

The government is also placing a strong emphasis on agriculture, focusing on crop diversification and improving infrastructure to support farmers. The Dhan Dhaanya Yojana targets rural districts with the lowest productivity, aiming to increase the disposable income of farmers and improve market access. This initiative, alongside the promotion of Farmer Producer Organisations (FPOs), will be pivotal in integrating small farmers into India’s growth story.

In addition to short-term measures, the government is committing to long-term asset creation, with a capex of over Rs. 50 lakh crore over the last four budgets. This will fund critical infrastructure projects in sectors like roads, railways, and defense, driving both employment and economic growth. These projects have also had a positive impact on women’s employment and entrepreneurship in various regions.

The focus on manufacturing is also reshaping India’s job market. With a push towards formalisation and growth in MSMEs, more people are expected to seek opportunities in manufacturing, which will foster a new wave of employment.

Furthermore, the government is looking to capitalise on smaller, innovative ideas. An example is transforming India Post into a major logistics player integrated with the Open Network for Digital Commerce, which would support MSMEs and young entrepreneurs across the country.

The Modi government’s fourteen budgets tell a story of significant reforms, from reducing tax rates to narrowing the fiscal deficit. The welfare transfer programs, which amount to Rs. 40 lakh crore, have directly benefited millions, further reinforcing the government’s focus on inclusive growth.

The message from the budget is clear: Now is the time to invest in India and grow with the nation. With a focus on both macroeconomic stability and microeconomic development, the government’s policies are set to drive India’s economic future.

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Key initiatives in the budget include an extension of the Jal Jeevan Mission until 2028, with a goal of achieving 100% rural water supply coverage and improving the maintenance of existing infrastructure. Furthermore, the Bharatnet Project will expand broadband connectivity to all rural government secondary schools and primary health centres, ensuring better access to education and healthcare.

India Post will be pivotal in the growth of rural economies, offering services like micro-enterprise credit, digital services, and logistics support to entrepreneurs, MSMEs, and self-help groups. This aligns with the government’s push to empower rural communities through greater economic inclusion.

Another significant announcement is the launch of the Rural Prosperity and Resilience Program, which aims to tackle under-employment in agriculture by promoting skill development, technology adoption, and investments. This program is designed to support rural women, young farmers, marginalized communities, and landless families.

The rural development initiatives have already shown considerable results, such as a reduction in the multidimensional poverty rate from 24.85% to 14.96%. Additionally, rural internet users have increased to 398.35 million, while wages have steadily grown across both agricultural and non-agricultural sectors.

In terms of rural infrastructure, programs like the Pradhan Mantri Gram Sadak Yojana (PMGSY) have provided all-weather roads, and the Pradhan Mantri Awaas Yojana-Gramin (PMAY-G) has delivered housing to those in need. The Mission Amrit Sarovar has rejuvenated over 68,843 ponds, ensuring sustainable water resources, while the National Rural Health Mission continues to offer quality healthcare to rural populations.

The Swachh Bharat Mission (Gramin) continues its efforts in the second phase to maintain open defecation-free status and manage waste, contributing to a cleaner, healthier rural environment. Alongside, the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) has received Rs. 86,000 crore in the FY 2024-25, securing rural livelihoods and providing much-needed employment opportunities.

The budget also emphasizes programs like the Saansad Adarsh Gram Yojana, PM-JANMAN, Deendayal Antyodaya Yojana, and Gram Nyayalayas Act, all of which aim to further uplift rural India. With these initiatives, the government is steadfast in its vision to build a developed and self-reliant India by 2047.

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Corporate tax collections are also expected to see significant growth, with a 10.4% increase in FY26, surpassing the 7.6% growth in FY25. This growth is linked to a broader economic recovery and higher corporate earnings.

On the expenditure side, the government’s overall spending is anticipated to rise by 7.4%, slightly higher than the previous year’s 6.1%. Capital expenditure (capex), primarily focused on infrastructure, is projected to grow by 10.1% in FY26. However, capex as a percentage of GDP will remain stable at 3.1%.

The report also indicates that the government’s fiscal deficit will be slightly lower than expected, revised to 4.8% of GDP in FY25, down from an earlier estimate of 4.9%. In absolute terms, the fiscal deficit is expected to be Rs 15.6 lakh crore, compared to the Rs 16.1 lakh crore originally projected for FY25.

India’s current account deficit remains moderate, supported by resilient services exports and remittances. Although the trade deficit is set to expand from USD 245 billion in FY24 to USD 277 billion in FY25, the impact on the current account will be limited due to strong remittances and services exports.

Overall, the report suggests a positive economic outlook for FY26, with higher GST collections, strong corporate tax growth, and a manageable fiscal deficit signaling a stable trajectory for India’s economy.

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Other major contributors to the current production include consumer electronics and industrial electronics, each accounting for 12 percent, followed by electronic components at 11 percent. Emerging segments such as automotive electronics, LED lighting, wearables and hearables, and PCBAs contribute the remaining share.

This ambitious growth trajectory is expected to create 12 million jobs by 2027, with 3 million of these being direct roles and the remaining 9 million in indirect positions. Among the direct jobs, nearly 1 million will be for engineers, 2 million for ITI-certified professionals, and 200,000 for specialists in high-demand fields like artificial intelligence (AI), machine learning (ML), and data science.

Indirect employment, largely focused on non-technical roles, will make up the majority of job opportunities, underscoring the electronics sector’s potential to spur economic growth and open a variety of career paths across India.

However, despite its optimistic outlook, the sector faces a major challenge: a critical talent gap. The shortage of skilled professionals is a key obstacle that could hinder the sector’s growth and its ability to meet ambitious production targets. Bridging this gap is vital for India to strengthen its position in the global electronics supply chain.

The solution lies in aligning workforce skills with the specific needs of the industry, particularly in high-demand areas such as semiconductors, electromechanical parts, and both passive and active components. This requires targeted skilling programs to fill the talent gap and ensure that India’s workforce is well-prepared to support the sector’s ambitious goals.

AR Ramesh, CEO of TeamLease Degree Apprenticeship, emphasized the need for focused skilling initiatives, noting, “Scaling apprenticeship enrollments, currently growing at a 55 percent compound annual growth rate (CAGR) and projected to reach 1 million apprentices by 2027 and 2 million by 2030, will be essential in creating a robust talent pipeline.”

He further added, “To become a global leader in electronics manufacturing, India must combine skilling efforts with strategic investments in infrastructure, policy interventions, and innovation.”

Sumit Kumar, Chief Strategy Officer at TeamLease Degree Apprenticeship, stressed the importance of building capacity to meet the growing demand for skilled professionals. “Employers and industries can support this initiative by setting up in-house training centres and collaborating with academic institutions through Work-Integrated Learning Programs (WILP) and degree apprenticeships,” he explained.

The path to India’s vision of becoming a global leader in electronics manufacturing requires a multifaceted approach. This includes boosting ITI enrollment, establishing in-house training centres, and expanding apprenticeship opportunities. Additionally, scaling reskilling and upskilling programs for over 50 percent of the workforce will be critical to bridging the skills gap and enabling sustainable growth.

In conclusion, the Indian electronics sector stands on the cusp of rapid growth, and with the right investments in skilling, infrastructure, and policy, it has the potential to become a global leader in manufacturing. By focusing on capacity building and industry-academia partnerships, India can successfully navigate the talent shortage and continue its journey toward becoming a major player in the global electronics supply chain.

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Shashi Kant Tripathi, Chief Public Relations Officer (CPRO) of North Central Railway, shared the update, stating that 15 of the 21 gates have already been removed, with the remaining gates set to be completed by December. “The plan aims to remove all the level-crossing gates in Prayagraj so that there is smooth movement of both road traffic and trains, especially during the Kumbh when the crowd size increases significantly,” Tripathi explained.

The decision to eliminate these gates is a strategic move to reduce the impact of heavy traffic congestion, particularly during the Kumbh Mela, which attracts millions of devotees. With both train movements and public road transport contributing to traffic delays, the removal of these gates will allow for better management of the high volume of visitors to the city.

The infrastructure project is part of the Railways’ broader efforts to streamline Prayagraj’s transport system ahead of the Maha Kumbh, ensuring the safe and efficient movement of people during the event. By eliminating the level-crossing gates, the Railways aims to address the challenges posed by the large crowds, improve safety, and minimize traffic disruptions.

In addition to the railway upgrades, the Uttar Pradesh Government has also deployed 350 shuttle buses to facilitate smooth travel for pilgrims and visitors. A team of 22 officers has been assigned to oversee the transport system’s operations and ensure seamless functioning throughout the event, which begins on January 13, 2025.

To further support the event’s logistics, Quick Response Teams (QRTs) have been placed on seven routes leading to Prayagraj, with emergency response measures in place. The Transport Corporation has set up a toll-free number (1800 1802 877) and a WhatsApp helpline (9415049606) that will operate 24/7 to assist devotees during their journey to and from the Kumbh Mela.

These efforts reflect the government’s commitment to ensuring a smooth and safe experience for the millions expected to attend the Maha Kumbh in 2025.

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