From Bihar to Middle Class: The biggest winners and losers of Budget 2025 | India Business News

India’s Budget 2025-26, presented by Finance Minister Nirmala Sitharaman, has delivered sweeping reforms aimed at boosting economic resilience, fostering inclusive growth, and empowering key demographics. Touted as one of the most concise yet impactful budget speeches in India’s history, it outlines ambitious plans to fuel consumption, support agriculture, and enhance women’s participation in the economy.The middle class emerges as the biggest winner, enjoying significant income tax relief with the threshold raised to ₹12 lakh, while farmers benefit from enhanced credit access and agricultural support schemes. Startups, women entrepreneurs, and Bihar also see targeted incentives designed to stimulate growth and job creation.
However, the budget isn’t without its disappointments. Sectors like infrastructure, oil and refineries, healthcare, and fertilizers faced setbacks due to reduced subsidies, limited capital expenditure, and a lack of comprehensive reforms. High-income earners see minimal tax relief, while environmental advocates criticize the absence of strong green initiatives. Although the budget champions fiscal consolidation and reforms, it reflects a delicate balancing act—prioritizing social welfare and economic inclusivity, yet leaving key sectors and issues underserved. In essence, Budget 2025-26 offers both optimism and caution, signaling bold strides forward with a few critical areas left in the shadows.

Biggest Winners of Budget 2025-26

1. Middle Class – Major Tax Breaks
Budget 2025 delivers significant tax relief to the middle class, raising the tax-free income threshold to ₹12 lakh. For salaried individuals, an additional standard deduction pushes the effective tax-free limit to ₹12.75 lakh. The revised tax slabs reduce rates across income brackets, ensuring that individuals earning up to ₹12 lakh annually pay no tax. This aims to boost disposable income, encourage savings, and stimulate domestic consumption. Simplified tax filing procedures ease compliance, while enhanced deductions for housing loans and education expenses reduce financial burdens. This comprehensive reform strengthens the purchasing power of the middle class, making them key drivers of economic growth.
2. Farmers – Boosted Credit & Crop Support
Farmers are among the biggest beneficiaries with comprehensive agricultural reforms. The Pradhan Mantri Dhan-Dhaanya Krishi Yojana targets 100 districts to improve productivity, diversify crops, and enhance credit access. The Mission for Aatmanirbharta in Pulses focuses on self-sufficiency in Tur, Urad, and Masoor, supported by assured procurement and price guarantees. Credit limits under the Kisan Credit Card (KCC) scheme have been raised from ₹3 lakh to ₹5 lakh, providing easier access to low-interest loans. Investments in post-harvest infrastructure and sustainable agricultural practices further support farmers. In Bihar, the Makhana Development Board will enhance local farming through value addition and market linkages.
3. Women – Empowered & Funded
Women’s economic empowerment is a cornerstone of Budget 2025. A new scheme for first-time women entrepreneurs offers term loans of up to ₹2 crore, supporting ventures across diverse sectors. The government aims for 70% female participation in economic activities, bolstered by skill development programs, mentorship initiatives, and accessible credit facilities. Rural women benefit from the Rural Prosperity and Resilience Program, promoting financial independence through enterprise development, leadership roles in cooperatives, and participation in self-help groups. Measures to improve maternal healthcare, education, and safety create a holistic framework for women’s socio-economic advancement, positioning them as key contributors to India’s growth.
4. Bihar – Special Development Push
Bihar receives focused attention with state-specific development initiatives. The establishment of a Greenfield Airport will enhance regional connectivity, while the Western Koshi Canal Project will boost irrigation across 50,000 hectares, benefitting local farmers. The National Institute of Food Technology Entrepreneurship and Management (NIFTEM) aims to promote agribusiness and food processing, generating employment opportunities. The creation of the Makhana Development Board supports local farmers through improved production techniques, value addition, and robust marketing strategies. Investments in infrastructure, education, and healthcare aim to uplift the socio-economic status of Bihar’s population, positioning the state as a key growth hub.
5. Startups – ₹100 Billion Boost
India’s startup ecosystem receives a significant boost with a ₹100 billion fund to promote entrepreneurship. This initiative aims to position India as a global startup hub, fostering innovation and economic growth. The government has also launched schemes for first-time entrepreneurs, particularly targeting women, Scheduled Castes, and Scheduled Tribes, offering term loans of up to ₹2 crore. The focus on startups aligns with India’s goal of becoming a global leader in technology and innovation. Enhanced access to funding, mentorship programs, and simplified regulatory frameworks will support the growth of new businesses, creating jobs and driving economic resilience.
6. Nuclear Power – Private Investment Surge
The nuclear power sector is set to expand significantly, with the government amending the Atomic Energy Act to encourage private investment. Plans are in place to boost nuclear power capacity to 100 GW by 2047, supporting India’s clean energy transition. The Civil Liability for Nuclear Damage Act will also be revised to attract investors. This policy shift benefits companies involved in nuclear infrastructure, such as BHEL and Walchandnagar Industries. The increased focus on nuclear energy aligns with India’s sustainability goals, reducing reliance on fossil fuels and promoting energy security, while opening new opportunities for private sector participation.
7. Consumption – Spending Power Up
The budget introduces tax cuts designed to boost consumer spending, which is critical for sustaining economic growth. The increased disposable income, especially among the middle class, is expected to drive demand for goods and services. This has already had a positive impact on the stock market, with the BSE Fast Moving Consumer Goods Index recording significant gains. Companies like Tata Motors and Hindustan Unilever are set to benefit from increased consumer confidence. The government’s focus on stimulating domestic consumption aligns with its broader goal of creating a resilient, demand-driven economy, supporting sectors ranging from retail to automotive.

Biggest Losers of Budget 2025-26

1. Infrastructure – Capex Letdown
The infrastructure sector was expecting a significant boost, but the budget delivered only a modest increase in capital expenditure, less than 1% from the previous year. Major construction firms like Larsen & Toubro, Siemens, and Indian Railway Finance Corporation saw their stocks underperform following the budget announcement. Additionally, the government reduced planned capital spending for the current fiscal year, dampening investor sentiment. Cement companies such as UltraTech, Ambuja, and ACC, which rely heavily on infrastructure projects, also experienced a decline in stock prices. This lack of substantial investment may slow down infrastructure development and job creation.
2. Oil & Refinery – Subsidy Squeeze
The oil and refinery sector faced a setback as the budget did not allocate compensation for state-run fuel retailers selling cooking gas below cost. Shares of companies like Indian Oil Corporation, Bharat Petroleum Corporation, and Hindustan Petroleum Corporation declined after this announcement. Furthermore, the petroleum subsidy was cut to ₹121 billion, down from ₹147 billion in the revised estimates. This reduction impacts the profitability of state-owned oil companies and adds pressure on their margins. Even Reliance Industries, with significant interests in the oil sector, experienced a dip in its stock price, reflecting broader investor concerns.
3. Fertilizer Firms – Subsidy Cut Shock
Fertilizer companies were hit hard by the government’s decision to slash fertilizer subsidies to ₹1.68 trillion, a significant reduction from previous allocations. This move aims to control the fiscal deficit but adversely affects companies like National Fertilizers Ltd., Rashtriya Chemicals & Fertilizers Ltd., and Chambal Fertilizers and Chemicals Ltd., whose shares dropped sharply post-budget. The cut in subsidies may lead to higher fertilizer prices for farmers, potentially affecting agricultural productivity. It also raises concerns about the financial health of fertilizer producers, who rely heavily on government support to maintain competitive pricing.
4. Healthcare – No Big Boost
The healthcare sector was disappointed with the budget’s limited focus on increasing public health spending. Despite the ongoing need for robust healthcare infrastructure, especially post-pandemic, there were no significant new initiatives or funding increases. India continues to spend only around 3.3% of its GDP on healthcare, well below global averages. This lack of investment impacted pharmaceutical stocks, with companies experiencing declines due to concerns over growth prospects. The absence of comprehensive reforms to strengthen the healthcare system, including public hospitals and health insurance coverage, is seen as a missed opportunity for the sector.
5. High Earners – No Tax Relief
While the middle class enjoyed substantial tax relief, high-income earners saw little benefit from Budget 2025. The top tax rate remains at 30% for individuals earning above ₹24 lakh annually, with no additional deductions or exemptions. This disparity in tax benefits may lead to dissatisfaction among high earners, who contribute significantly to tax revenues. The lack of incentives for wealth creation could also impact investment behaviors, with fewer tax-saving opportunities available. Overall, the budget’s focus on middle-class relief comes at the expense of addressing the concerns of high-income groups.
6. Environment – Green Goals Missed
Despite growing global concerns about climate change, Budget 2025 offered limited new investments in renewable energy, beyond a focus on nuclear power. There were no aggressive climate action targets, major funding for green initiatives, or incentives for eco-friendly businesses. This lack of emphasis on sustainability disappointed environmental advocates and investors focused on green technologies. The absence of substantial support for sectors like solar, wind, and electric mobility indicates a missed opportunity for positioning India as a leader in the global green economy. The budget’s environmental measures were seen as insufficient to meet climate commitments.
7. Informal Businesses – Left in the Cold
While MSMEs received significant support through credit enhancements and policy reforms, the informal sector and micro-enterprises were largely overlooked. Businesses not registered under formal government schemes like Udyam missed out on the benefits, widening the gap between formal and informal sectors. This is concerning, given that a large portion of India’s workforce is employed in the informal economy. The lack of targeted support for unregistered businesses limits their growth potential and access to credit, hindering overall economic inclusivity. This oversight may slow progress in formalizing the economy and supporting grassroots entrepreneurship.
With inputs from Bloomberg