PM Modi Declares 2025 India's Reform Express Year with Major Policy Overhauls
Prime Minister Modi has positioned 2025 as a transformative reform year for India, implementing comprehensive policy changes across taxation, investment, trade, and governance. Key reforms include GST simplification to two slabs, income tax exemption for earnings up to ₹12 lakh, 100% FDI in insurance, merger of 29 labour laws into four codes, and new trade agreements with developed nations, all aimed at building a modern, investor-friendly economy.
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Prime Minister Narendra Modi has declared 2025 as a landmark year in India's reform journey, describing it as the year India "boarded the Reform Express." Following his recent meeting with economists at NITI Aayog for budget preparations, the Prime Minister outlined comprehensive reforms across multiple sectors aimed at strengthening growth, simplifying governance, and improving citizens' lives.
Major Tax and GST Reforms
The government implemented significant fiscal reforms to reduce compliance burden and boost economic activity:
| Reform Area | Key Changes |
|---|---|
| GST Structure | Simplified to two-slab system: 5% and 18% |
| Income Tax Relief | Zero tax for individuals earning up to ₹12 lakh annually |
| Tax Legislation | Replaced Income Tax Act 1961 with simpler Income Tax Act 2025 |
| Small Business Support | Expanded definition to include firms with ₹100 crore turnover |
The GST reform particularly benefited households, MSMEs, farmers, and labour-intensive sectors while reducing disputes and improving compliance. Consumer demand showed notable improvement, especially during the festive season.
Investment and Market Reforms
The government introduced sweeping changes to attract investment and modernize financial markets:
| Sector | Reform Details |
|---|---|
| Insurance | 100% FDI allowed to improve coverage and competition |
| Securities Market | New Securities Market Code Bill to strengthen SEBI |
| Labour Laws | 29 laws merged into four comprehensive labour codes |
| Business Environment | 71 outdated Acts repealed under Jan Vishwas initiative |
Trade and Energy Initiatives
India expanded its global trade footprint while focusing on clean energy transition. The country signed trade agreements with New Zealand, Oman, and the UK, and operationalized its first free trade agreement with developed European nations under EFTA.
The SHANTI Act was introduced to support safe nuclear energy expansion, addressing rising power needs and enabling private sector participation in the clean energy sector.
Rural Development and Education Reforms
The Viksit Bharat–GRAM G Act 2025 increased guaranteed workdays from 100 to 125 days, strengthening village infrastructure and rural incomes. In education, a new bill proposes creating a single higher education regulator to replace multiple bodies like UGC and AICTE, granting institutions greater autonomy while boosting research and innovation.
PM Modi emphasized that these reforms build on 11 years of continuous work, with the main driving force being India's young population and the "indomitable spirit of our people." The reforms aim to enable citizens to live with dignity, entrepreneurs to innovate with confidence, and institutions to function with clarity and trust.
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