Blind Spot in India’s 2025 Budget: Unemployment Crisis Ignored?

A Crisis Swept Under the Rug

There’s a famous maxim: “Give a man a fish, and you feed him for a day; teach a man to fish, and you feed him for a lifetime.” But in India’s case, what happens when a man is given neither a fish nor the tools to fish? That is the unsettling reality of India’s unemployment crisis—one that the 2025 Budget has chosen to ignore.

Unemployment remains a ticking time bomb in the Indian economy, yet the recent budget has largely bypassed it. A glaring omission is the failure to follow through on promises made in the 2024 Budget, particularly the Prime Minister’s Five-Scheme Employment Package, which aimed to create 4.1 crore jobs and internships over five years with an allocation of ₹2 lakh crore. The 2025 Budget does not even reference this package, leaving its future uncertain.

Where Did the Promised Jobs Go?

In response to inquiries about the status of these employment schemes, the government’s reply remains vague: a “draft cabinet note is under finalization” for the Employment Linked Incentive Scheme, and bureaucratic meetings continue. But with no concrete implementation steps taken, these initiatives risk fading into oblivion.

The Periodic Labour Force Survey (PLFS) Report (Sept 2024) highlights a disturbing trend:

• Youth unemployment (ages 15-29) rose to 10.2% in 2023-24.
• Unemployment among graduates stands at a staggering 13%.
• The share of salaried employment has shrunk, while informal jobs and agriculture work have risen—a sign of economic distress.

Meanwhile, the Economic Survey 2024 presents another grim reality:

• Real earnings of self-employed male workers have dropped from ₹9,454 (2017-18) to ₹8,591 (2023-24).
• Salaried male workers’ average monthly income fell from ₹12,665 (2017-18) to ₹11,858 (2023-24).

With inflation on the rise and surplus labor crowding the job market, the government’s silence on employment in the 2025 Budget is alarming.

Budget Cuts That Hurt the Workforce

Compounding the issue is the government’s fiscal approach. With GDP growth projected to decline from 8.2% (2023-24) to 6.4% (2024-25), the government has chosen austerity over investment, cutting expenditure by over ₹1 lakh crore, including:

• ₹47,469 crore cut in the Jal Jeevan Mission.
• ₹38,575 crore cut in the Pradhan Mantri Awas Yojana (rural & urban).
• ₹3,654 crore cut in MGNREGA (already reduced in the previous year).

These cuts disproportionately impact rural and low-income households, further dampening employment opportunities.

A Misguided Relief: Tax Breaks for the Few

To counteract these cuts, the Finance Minister has introduced an income tax rebate, increasing the threshold from ₹7 lakh to ₹12 lakh. However, this benefits only 2.8 crore taxpayers, just 22% of India’s salaried workforce.

A more effective alternative could have been reducing excise duties on fuel or GST on mass consumption goods, benefiting the broader working class.

Conclusion: A Budget That Fails Its Workforce

Rather than addressing unemployment head-on, the government has chosen to brush it under the carpet, hoping that tax breaks will generate enough demand to stimulate growth. However, with declining incomes and shrinking job opportunities, this strategy seems unlikely to uplift India’s struggling workforce.

A comprehensive, employment-focused economic policy is the need of the hour—not fiscal austerity disguised as economic prudence. The real question is: Will the government recognize this blind spot before it’s too late?