Finance Minister Smt. Nirmala Sitharaman presented the Union Budget for FY 2020- 2021. This Union Budget will aim at energizing the Indian economy through a number of measures. Below are the main highlights of the Union Budget 2020-2021.
The Union Budget 2020-2021 is based on three main themes
1. Aspirational India
It focuses on improving the standards of living with access to education, jobs, better health facilities for all sections of society
2. Economic Development
The slogan for this theme is- “Sabka Saath, Sabka Vikas, Sabka Vishwas”
3. Caring Society
Focuses on creating a society that is both humane and compassionate
Components of Aspirational India
a. Agriculture, Irrigation, and Rural development
b. Wellness, Sanitation, and Water
c. Education and Skills
Budget allocation for Agriculture, Irrigation and Rural development
- 1.60 lakh crore allocated for Agriculture and Irrigation.
- 1.23 lakh crore allocated for Rural Development and Panchayati raj.
- Comprehensive measures have been proposed for 100 water-stressed districts
- As a part of Blue Economy,
– an exports target of Rs 1 lakh has been set to be achieved by 2024-25
– 200 lakh tonnes of fish production to be achieved by 2022-23
– Growing of sea-weed, algae and cage culture to be promoted
- Indian Railways will set up Kisan Rail to build a seamless supply chain for perishables. Freight and Express trains will have refrigerated coaches.
- Ministry of Civil Aviation will launch Krishi Udaan with the aim of covering both national and international routes and improving the value of agri-products.
- Balanced use of fertilizers to be promoted.
- Integrated Farming Systems to be expanded in rain-fed areas.
- Multi-tier cropping, solar pumps and bee-keeping to be added in non-cropping.
- Stand-alone solar pumps to be provided to 20 lakh farmers while 15 lakh farmers will be helped to solarise their grid-connected pump sets.
Wellness, Water and Sanitation
- 69,000 crore allocated for the healthcare sector. Out of this, Rs. 6400 crore is allocated for PM Jan Arogya Yojana.
- 2000 medicines and 300 surgical to be provided to all districts by Jan Aushadhi Kendra Scheme.
- 3.60 lakh crore approved for Jal Jeevan Mission, out of which Rs. 11,500 crores have been approved for the year 2020-21. The mission will aim at augmenting local water sources, recharging existing sources, and promoting water harvesting and desalination.
- 12, 300 crores allocated for Swachh Bharat Missionwith the emphasis on liquid and greywater management, solid-waste collection and processing.
Education and Skills
- 99300 crore allocated for the education sector.
- 3000 crore allocated for skill development in 2020-21.
- Up to 1-year internship to be provided to fresh engineers by Urban Local Bodies.
- Special courses to be developed by Ministries of Health and Skill Development in order to bridge the gap between the skill sets of the workforce and employers’ standards.
- Apprenticeship embedded courses will be started by 150 higher education institutions by March 2021.
- Ind-SAT proposed as a part of the Study in India program to target Asian and African countries.
Economic Development
- 27,300 crore allocated for development and promotion of Industry and Commerce for 2020-2021.
- End-to-end facilitation and support will be provided by a newly proposed Investment Clearance Cell.
- Development of five smart cities has been proposed.
- National Technical Textiles Mission to be set-up within a period of 2021 to 2024. The cost of this project will be 1480 crore and this will enhance India’s position as a global leader in Technical Textiles.
- Higher Export Credit disbursement to be achieved through a new scheme NIRVIK.
- 100 lakh crore allocated for infrastructure for a period of next 5 years.
- Projects worth Rs. 103 crore launched on 31st December 2019.
- A National logistic Policy will be released soon to bring clarification on the roles of State Governments, Union Government and other key regulators.
- 1.7 lakh crore allocated for transport infrastructure for 2020-2021.
- 100 more airports to be developed by 2024 in order to support Udaan Scheme.
- Air fleet number expected to get double from 600 to 1200.
- 22000 crore proposed for renewable energy and power sector (2020- 2021).
- National gas grid to be expanded from 16200km to 27000km.
- 6000 crore proposed for Bharatnet programme.
- 100000 gram panchayats to be linked through FTTH (Fibre to the Home) connections in 2020- 2021.
- 8000 crore proposed for National Mission on Quantum Technologies and Applications.
Caring Society
- More focus to be derived on-
– Women 7 Child
– Culture and Tourism
– Social Welfare
- Allocation of Rs. 35600 proposed for nutrition-related programmes (FY 2020- 2021).
- Allocation of Rs. 28000 crore proposed for women-related programmes.
- 85000 crore proposed for 2020- 2021 for the Scheduled and backward Classes.
- 53700 crore allocated for further development of Scheduled Tribes.
- 9500 crore allocated for Senior Citizens and Divyang.
- 2500 crore allocated for tourism promotion.
- 3150 crore to be allocated for Ministry of Culture.
- 5 Archaeological sites to be developed as iconic sites.
-Rakhigarhi (Haryana)
-Hastinapur (Uttar Pradesh)
-Shivsagar (Assam)
-Dholavira (Gujarat)
-Adichanallur (Tamil Nadu)
- 4 more museums to be taken for re-curation and renovation.
- Tribal Museum to be set up in Ranchi.
- 4400 to be allocated for Environment and Climate.
Governance
- 100 crore allocated for G20 presidency to be hosted in India in the year 2022.
- An amount of Rs. 30,757 crore provided for the financial year 2020-21 for the development of Union Territories of J&K and Ladakh.
- 5958 crores allocated for the Union Territories of Ladakh.
Financial Sector
- 350000 crore capital infused in PSBs.
- Deposit Insurance Coverage under Deposit Insurance and Credit Guarantee Corporation (DICGC) to be increased to Rs. 5 lakh from Rs.1 lakh per depositor.
- NBFCs eligibility limit for debt recovery reduced from:
– Rs. 500 crore to Rs 100 crore asset size.
– Rs 1 crore to Rs 50 lakh loan size.
- FPI limit in corporate bonds increased to 15% from 9% of its outstanding stock.
Infrastructure Financing
- 103 lakh crore National Infrastructure Pipeline projects earlier announced.
- Rs 22,000 crore to cater to the equity support to Infrastructure Finance Companies such as IIFCL and a subsidiary of NIIF.
Tax
Direct tax
Proposals to promote growth, reduce litigations, and bring ease of compliance.
Personal Income Tax
- No tax for 0- Rs. 5 lakh
- 10% tax for the income between Rs. 5 lakh- Rs. 7.5 lakh
- 15% tax for the income between Rs. 7.5 lakh- Rs. 10 lakh
- 20% tax for the income between Rs. 10 lakh- Rs. 12.5 lakh
- 25% tax for the income between Rs. 12.5 lakh- Rs. 15 lakh
- 30% tax for the income above Rs. 15 lakh
Corporate tax
- Tax rate extended by 15% to new electricity generation companies.
- Indian Corporate Tax is among the lowest rates in the world.
Start-ups
- Start-ups with turnover up to Rs. 100 crore to enjoy a 100% deduction for 3 consecutive assessment years out of 10 years.
Affordable Housing
- Additional deduction up to Rs. 1.5 lakhs for interest paid on loans taken for an affordable house extended till 31st March, 2021.
- Date of approval of affordable housing projects for availing tax holiday extended till 31st March, 2021.
Indirect Tax
GST
- Cash reward system proposed for the customers seeking invoice.
- Simplified returns with SMS based filing and improved input tax credit flow.
- Critical information to be captured by electronic invoice.
- Aadhaar based verification of taxpayers.
Custom Duties
- Custom duty raised from 25% to 35% on footwear and from 20% to 25% on furniture goods.
- Custom duty on imports of light0weight paper reduced from 10% to 5%.
- Lower custom duty on raw materials.
- Higher custom duty on certain goods that are also manufactured domestically.