New Delhi: Finance Minister Nirmala Sitharaman presented India’s Union Budget for Financial Year 2021-22 in Parliament today with a ‘made in India’ tablet computer to deliver her paperless Budget address. The Budget for FY22 is deemed as a crucial one as it comes amid the novel coronavirus pandemic, which has severely impacted country’s economy. People were looking up to this Budget to tackle their major issues like employment, tax concessions, health care, inflation, etc.
In view of corona pandemic, this Budget was kept paperless and electronic copies of the same were distributed to members of Parliament.
Sitharaman’s budget has six pillars: Health and wellbeing, Infrastructure, Inclusive development, Development of human capital, Research and development, Minimum government, maximum governance. In her two-hour-long speech, Sitharaman mentioned ‘privatisation’ several times, which is being seen as a departure from the general practice as government shies away from mentioning the word. Her speech also got disrupted when the ministers started to talk about her government’s commitment towards farm sectors and for farmers’ benefit.
Before tabling this digital Budget, Finance Minister Nirmala Sithraman said: It will be the first of this new decade. The preparation of this Budget was undertaken in circumstances like never before, in view of calamities that have affected a country or a region within a country. But what we have endured with COVID-19 to 2020 is Sui generis.
What is expected from this Budget
-When the recession and unemployment are driving down the economy of this country amid the Corona crises, people have great expectations from this general Budget. It is believed that this Budget will mainly focus on health, education and ‘Make in India’ initiative. There are likely to be some big announcement on agriculture too.
Budget FY21 Highlights:
-Nirmala Sitharaman concluded her Budget speech saying there has been no announcement for individual tax payers’ slabs.
–Defence Budget got INR 4.78 lakh crore against previous year’s INR 4.71 lakh crore.
-FM Sitharaman eases home loan burden, announced an additional deduction of INR 1.5 lakh taken till March 31, 2022. The provision was originally announced in 2019. Her Budget offers a person purchasing an affordable house, an enhanced interest deduction of up to ₹3.5 lakh.
-Affordable housing projects can avail a tax holiday for one more year – till 31st March, 2022
-A voluntary vehicle scrapping policy where vehicles, 20-years-old will undergo fit test.
–Customs duty on some auto parts were raised to 15%, decreased on leather products
–Customs duty on copper scrap cut to 2.5%
–Customs duty on cotton increased to 10%
–Customs duty on solar lanterns cut to 5%
-Change in custom duties frees consumers from bearing additional burden.
–Custom duty on gold and silver has been reduced, with 7.5 % on gold.
–Announcement of PF: Late deposit of employee’s contribution (towards social security) will not be allowed as a deduction to the employer, said Nirmala Sitharaman
-FM proposes INR 1,500 crore-scheme to promote digital payments.
-Sitharaman in her Budget 2021-22 speech also promises to launch a new initiative, National Language Translation Mission.
–Education Budget to set up 100 new Sainik schools, A Central university in Leh
-More than 15,000 schools will be qualitatively strengthened
-Legislation for umbrella body of higher education
-FM on migrant workers: A website dedicated to compile details of workers
-32 states covering 69 crore beneficiaries have implemented One Nation One Ration card.
-Sitharaman announced INR 20,000 crore for PSB recapitalisation and INR 5 lakh for as deposit insurance.
-Nirmala Sitharaman proposes change in laws to permit FDI in insurance sector from 49% to 74 %
–Ujjwala scheme extended to 1 crore additional families. About eight crore are already covered under this scheme: FM
Nirmala Sitharaman spelt out the proposed highways works in states:
-3,500 km corridor in Tamil Nadu
-1,100 km in Kerala at investment of ₹65,000 crore
-675 km in West Bengal at a cost of ₹95,000 crore
-1,300 km in Assam in the next 3 years
-Budget FY21 to infuse INR 2,83,846 lakh crore for health and wellness including INR 35,000 crore for Covid-19 vaccines.
-Sitharaman’s Budget FY22 allocates ₹35,000 crore for Covid-19 vaccines. “Government to provide ₹35,000 crore for Covid-19 vaccination in 2021-22; I am committed to providing more funds if required,” she said.
-Budget FY22 brings relief to senior citizens, no income tax filing required for senior citizens above 75 years of age and who have income only from pension and interest income.
-Tax audit limit increased from INR 5 crore to INR 10 crore.
-FM announced that the central government planned to reduce timeline for reopening of tax cases to 3 years from 6 years.
-Serious tax offences of concealment of income of over INR 50 lakh can be reopened after 10 years.
–Fiscal deficit in BE 2021-22 is pegged at 6.8% of the GDP. Aim to bring fiscal deficit below 5% of the GDP by 2025-26: FM
-BPCL, Air India, Shipping Corp, Container Corp and other disinvestments will be completed in 2021-22.
-INR 75,100 crore allocated for farmers.
-Govt says MSP procurement to continue at a steady pace
-Total amount paid to paddy farmers surged to INR 1.72 lakh crore in 2020-21
-Increase in agriculture credit target to INR 16.5 lakh crore
-FM announces further infusion of INR 20,000 crore for public sector banks.
-Sitharaman announced to infuse INR 1.1 lakh crore to speed Indian Railways. Of total, INR 1.07 lakh crore of provision to Indian Railway in FY22 would be for capital expenditure, finance minister mentioned.
-Presenting the Union Budget for 2021-22, she said Railways will monetize dedicated freight corridors. “We will work towards raising the share of public transport with an outlay of ₹18,000 crore,” she announced.
-In her Budget speech, Sitharaman also said national monetisation pipeline for potential brownfield infrastructure assets will be launched and pipelines of GAIL (India) Ltd, Indian Oil Corp (IOC) and HPCL will be monetised.
-She also said a record ₹1,10,055 crore will be provided for railways, of which ₹1,07,100 crore will be for capital expenditure in 2021-22.
– The government also announced a ₹18,000 crore scheme to augment public transport in urban areas.
FM Nirmala Sitharaman and Minister of State for Finance Anurag Thakur reached the Finance Ministry, after the cabinet meeting. Sitharaman had left for Rashtrapati Bhavan after the Union Budget 2021-22 was passed in Parliament. The Cabinet chaired by Prime Minister Narendra Modi approved the Budget for the fiscal year 2021-22.
The general budget was presented today on February 1, 2021. Finance Minister Nirmala Sitharaman tabled the budget at 11 am, where several important announcements were made in Budget 2021 to bring country’s limping economy back on track.