Union Finance Minister Nirmala Sitharaman on Saturday presented the Budget for the Financial Year 2020-21.
“This budget is woven around three prominent themes, aspirational India, in which all sections of society seek better standards of living, economic development for all, indicated in Prime Minister’s exhortation ‘Sabka Saath, Sabka Vikaas’, and lastly, ours shall be a caring society,” Sitharaman said during the presentation of the Budget.
Economic Development for All
Ours shall be a caring society
– FM @nsitharaman points out three threads on which the Budget is woven
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She further said that the digital revolution will play a big role in delivering services to the people in India in the coming days.
Finance Minister Nirmala Sitharaman on Saturday cut short her Budget speech in Lok Sabha as she felt unwell after speaking for a record 160 minutes.
Sitharaman had only two pages of her Budget speech unread when she appeared uneasy and was seen wiping sweat from her forehead.
She was offered candies by her ministerial colleagues, but that did not help and she opted to discontinue the speech asking Speaker Om Birla to consider the remaining part of her speech as read.
Here are the key highlights of Nirmala Sitharaman’s Budget Speech:
1. Nominal GDP growth for the year 2020-21 estimated at 10%, on the basis of trends available. Accordingly, receipts for 2020-21 estimated at Rs 22.46 lakh crores Expenditure estimated to be Rs 30.42 lakh crores.
2. Fiscal deficit of 3.8% in RE 2019-20 and 3.5% in BE 2020-21
3. Central govt’s debt has come down to 48.7% in March, 2019 from 52.2% in March, 2014.
4. To provide significant relief to individual tax payers and simplify tax law, a new regime of personal income tax to be introduced. Around 70 of more than 100 income tax deductions and exemptions have been removed, in order to simplify tax system and lower tax rates.
5. Under the new personal income tax regime, individual tax payers to pay tax at reduced rate of 10% for income between Rs 5 lakh – Rs 7.5 lakhs.
6. For income between Rs 7.5 lakhs – Rs 10 laks, tax rate will now be 15% against the current 20%.
7. For income between Rs 10 lakhs – Rs 12.5 lakhs, the new tax rate will be 20%, down from 30%.
8. For income between Rs 12.5 lakh – Rs 15 lakhs – tax rate will be 25%
9. Income above 15 lakh rupees will continue to be taxed at 30%
10. The new personal income tax regime is optional for taxpayers and the new tax rates are without deductions available under the old tax regime.
11. Those who wish to claim rebates and concessions are free to file taxation under the old regime.
12. Dividend Distribution Tax to be removed, companies will not be required to pay DDT; dividend to be taxed only at the hands of recipients, at applicable rates.
13. Concessional corporate tax cut to be extended to new domestic companies engaged in power generation.
14. Tax on Cooperative societies to be reduced to 22 per cent plus surcharge and cess, as against 30 per cent at present.
15. FM says GST has resulted in efficiency gains in transport and logistics sector, inspector raj has vanished, it has benefitted MSME
Agriculture & Allied Activities
1. Rs 2.83 lakh crores allocated for agriculture and allied activities, irrigation and rural development
2. Agricultural credit target has been set at Rs 15 lakh crores. NABARD Refinancing Scheme to be further expanded.
3. Comprehensive measures for 100 water-stressed districts being proposed.
4. Krishi UDAN will be launched by Ministry of Civil Aviation on international and national routes, improving value realization in North East and tribal districts.
5. Indian Railways will set up Kisan Rail through PPP arrangement, for transportation of perishable goods
6. Farmers who have fallow or barren land will be helped to set up solar power generation units and also sell surplus power to the solar grid
7. Pradhan Mantri Kisan Urja Suraksha evam Utthan Mahabhiyan (PM KUSUM) to be expanded to provide 20 lakh farmers in setting up standalone solar pumps
8. Milk processing capacity to be doubled by 2025
9. Fish production to be raised to 200 lakh tonnes by 2022-23. Framework for development, management and conservation of marine fishery resources to be put in place. Fishery extension work to be enabled by rural youth as Sagar Mitras, forming 500 fish farmer producing organizations
Industry & Commerce
1. Rs 27,300 crore for development of industry and commerce
2. Investment Clearance Cell to provide end-to-end facilitation, support and information on land banks.
3. Scheme focussed on encouraging manufacture of mobile phones, electronic equipment and semiconductor packaging to be introduced.
4. National Technical Textiles Mission to be introduced, with a four-year implementation period, with an outlay of Rs 1,480 crores.
5. To achieve higher export credit, a new scheme being launched which provides higher insurance cover, reduced premium for small exporters and simplified procedure for claim settlements.
1. Rs 1.7 lakh crores to be provided for transport infrastructure in the coming financial year.
2. 100% tax concession to sovereign wealth funds on investment in infra projects.
3. Accelerated development of highways will be undertaken. Delhi-Mumbai Expressway and two other projects to be completed by 2023.
4. 100 more airports to be developed by 2024 to support the UDAN scheme.
5. More Tejas like trains to be introduced.
6. Rs. 22,000 crores for power and renewable energy sector in 2020-21
7. National Gas Grid to be expanded from 16,200 kms to 27,000 kms
8. Large solar power capacity to be set up alongside rail tracks, on land owned by Railways.
9. Fibre to Home connections under Bharat Net will be provided to 1 lakh gram panchayats this year itself, 6000 crore rupees provided for Bharat Net
Rs 30,757 crores for Union Territory of Jammu & Kashmir Rs 5,958 crores for Union Territory of Ladakh
Banking & Finance
1. Deposit Insurance Coverage to be increased from 1 lakh rupees to 5 lakh rupees. FM says robust mechanism is in place to monitor and ensure health of all scheduled commercial banks and depositors’ money is absolutely safe.
2. Govt. proposes to sell part of its holding in Life Insurance Corporation by way of Initial Public Offering
3. Certain specified categories of government securities will be open fully for NRIs, apart from being open to domestic investors
4. Government proposes to expand Exchange Traded Fund by floating a Debt ETF, consisting primarily of govt. securities.
5. GIFT City to have an International Bullion Exchange, enabling better price discovery of gold
6. Amendments to be made to enable NBFCs to extend invoice financing to MSMEs. App-based invoice financing loans product to be launched, to obviate problem of delayed payments and cash flow mismatches for MSMEs
7. India to host G20 Presidency in 2022, 100 crore rupees to be allocated for making preparations for this historic occasion, where India will drive global economic agenda
1. Rs 99,300 crores to be provided for education sector in 2020-21 and Rs 3,000 crores for skill development
2. Degree-level full-fledged online education programme to be offered by institutes in top 100 in National Institutional Ranking Framework.
3. Urban local bodies across the country to provide internships for young engineers for a period of up to one year.
4. IND-SAT exam to be held in African and Asian countries, for benchmarking foreign candidates who wish to study in India.
5. Government proposes to set up National Police University and National Forensic University.
6. Beti Bachao Beti Padhao has given tremendous results, Gross Enrolment Ratio is now higher for girls than for boys at all levels. GER for girls is 94.3 at the elementary level.
1. Budget 2020 provides an additional Rs 69,000 crore for the health sector
2. Govt to expand Mission Indradhanush, add more hospitals to Ayushman Bharat
3. Jan Aushadhi Kendras in all districts of country to be expanded to provide medicines at affordable rates.
4. A medical college to be attached to each district hospital in PPP mode. Viability gap funding to be set up for setting up such medical colleges.
5. Rs 35,600 crores outlay for nutrition-related programmes in 2020-21.
6. Over 6 lakh anganwadi workers have been equipped with smartphones to upload the nutrition status of 10 crore households.
Rs 28,600 crores provided for programmes which are specific to women
Welfare of SCs/STs and Divyangjan
85,000 crore rupees for Scheduled Castes and Other Backward Classes in 2020-21 53,700 crore rupees for Scheduled Tribes Enhanced allocation of 9,500 crore rupees for Senior citizens and Divyangjan
Indian Institute of Heritage and Conservation to be established under the aegis of Ministry of Culture. Five archaeological sites to be developed as iconic sites- Rakhigarhi (Haryana), Hastinapur (UP), Shiv Sagar (Assam), Dholavira (Gujarat) and Adishanaloor (Tamil Nadu).