Will Goddess Lakshmi smile on the middle-class in Union Budget 2025?

As Nirmala Sitharaman gears up for Budget 2025, Indians seek relief from inflation, stagnant wages, job scarcity, and high taxes, hoping for reforms to ease daily financial stress

As Union Finance Minister Nirmala Sitharaman prepares to present her eighth consecutive Union Budget, the hopes and anxieties of millions of Indians rest on her announcements. The common man, grappling with rising prices, stagnant wages, and limited job opportunities, is eagerly looking for relief. Inflation has strained household budgets, job growth remains sluggish, and economic uncertainty looms large. What exactly does the average Indian expect from Budget 2025?

 

Here are the top five concerns that the budget must address to bring meaningful change:

 

1. Battling inflation: A cry for relief 

Across India, households are grappling with the strain of skyrocketing prices for daily essentials. Vegetables, cooking oil, and milk have all seen sharp price hikes. Disruptions in vegetable supply due to extreme weather, higher import duties on cooking oil, and rising input costs for dairy have driven prices upward. While a recent Re 1 reduction in milk prices by cooperatives like Amul provides minor relief, it remains largely insignificant.   

 

Packaged food items like biscuits and toiletries, which rely heavily on palm oil, have also become more expensive. Companies are warning of further price hikes due to rising input costs. A reduction in import duties on edible oils could help lower both retail prices and production costs for fast-moving consumer goods (FMCG) companies. The Budget must prioritise measures to curb inflation, ensuring that basic necessities remain within reach for the average household, The Hindustan Times reported.

 

2. Stagnant wages: The struggle to keep up 

While prices soar, wages are struggling to catch up. The slow growth in earnings, especially for non-salaried workers—who make up more than half of the urban workforce—is a major concern. According to Britannia’s second-quarter earnings call, wages for non-salaried workers rose by just 3.4 per cent, compared to a 6.5 per cent increase for salaried employees over the past year. A report by FICCI and Quess Corp highlighted an alarming 0.8 per cent compound annual growth rate in wages for sectors like engineering, manufacturing, and infrastructure from 2019 to 2023.

 

This wage stagnation is happening even as corporate profits soar, thanks to lower taxes and post-pandemic demand recovery. The Budget needs to focus on policies that boost wage growth, particularly for blue-collar workers and mid-level professionals, to revive consumption and economic momentum.  Also Read: Budget 2025: Nirmala Sitharaman's sari honours Bihar's Madhubani artists

 

3. Economic slowdown: Reigniting growth 

India’s economy is projected to grow at 6.4 per cent in 2024-25—the slowest pace since the pandemic-induced contraction. One key reason is muted government spending on infrastructure projects, which typically drives demand for cement, steel, and construction equipment. This demand not only supports industries but also leads to job creation in manufacturing and construction sectors.

 

When factories operate at around 80 per cent capacity, businesses are more likely to invest in expansion, creating even more jobs. The government’s commitment to accelerating capital expenditure can act as a catalyst for economic revival. Budget 2025 must prioritise infrastructure investments to stimulate growth, generate employment, and restore confidence in the economy.

 

4. Slow job creation: Addressing the employment crisis 

The Covid-19 pandemic triggered a reverse migration, with millions returning to rural areas after losing urban jobs. Unfortunately, this trend hasn’t fully reversed, as many struggle to find stable employment or cope with the high cost of living in cities. 

 

While official data suggests an uptick in formal sector jobs, the reality is that India still falls short of creating enough opportunities for its growing labour force. Increased government spending on infrastructure, along with private sector investments in labour-intensive industries, could improve the job market. Additionally, targeted support for micro, small, and medium enterprises (MSMEs) can boost entrepreneurship and employment. Budget 2025 must lay out a comprehensive roadmap to address the persistent job crisis.

 

5. Tax burden: Easing financial stress 

High taxes remain a significant concern for the lower- and middle-income groups. While the central government has limited control over indirect taxes like GST — which are governed by the GST Council — there are still areas where relief can be provided.

 

Reducing import duties on essential items like edible oils and rationalising taxes on petroleum products could offer immediate relief. Moreover, lowering income tax rates for individuals in the lower- and middle-income brackets has been a long-standing demand. Although the NDA government has made incremental changes over the years, Budget 2025 presents an opportunity for bold reforms that leave more disposable income in the hands of the common man.

 

Expectation: Reduce tax burden 

As Finance Minister Nirmala Sitharaman is about to present the Union Budget, the expectations of ordinary Indians are clear: control inflation, boost job creation, ensure fair wage growth, and reduce the tax burden. Meeting these demands requires a delicate balance between fiscal discipline and welfare spending. 

Will Budget 2025 rise to the occasion and deliver on these hopes? The answer lies just round the corner.