Budget 2021:
Finance Minister Nirmala Sitharaman said that the Budget proposals for this financial year rest on six pillars — health and well-being, physical and financial capital and infrastructure, inclusive development for aspirational India, reinvigorating human capital, innovation, and R&D, and ‘Minimum Government, Maximum Governance’.
Significant announcements included a slew of hikes in customs duty to benefit Make in India, a proposal to disinvest two more PSBs and a general insurance company, and numerous infrastructure pledges to poll-bound States.
- The fiscal deficit stands at 9.5% of the GDP and is estimated to be 6.8% in 2021-22. Personal income tax slabs remain as is.
Union Budget 2021 Highlights:
Health and Sanitation:
- A new scheme, titled PM Atma Nirbhar Swasthya Bharat Yojana, to be launched to develop primary, secondary and tertiary healthcare
- Mission POSHAN 2.0 to improve nutritional outcomes across 112 aspirational districts
- Operationalization of 17 new public health units at points of entry
- Modernising of existing health units at 32 airports, 15 seaports and land ports
- Jal Jeevan Mission Urban aimed at better water supply nationwide
- Strengthening of Urban Swachh Bharat Mission
Education:
- 100 new Sainik Schools to be set up
- 750 Eklavya schools to be set up in tribal areas
- A Central University to come up in Ladakh
Infrastructure:
- Vehicle scrapping policy to phase out old and unfit vehicles – all vehicles to undergo fitness test in automated fitness centres every 20 years (personal vehicles), every 15 years (commercial vehicles)
- Highway and road works announced in Kerala, Tamil Nadu, West Bengal and Assam
- National Asset Monetising Pipeline launched to monitor asset monetisation process
- National Rail Plan created to bring a future ready Railway system by 2030
- 100% electrification of Railways to be completed by 2023
- Metro services announced in 27 cities, plus additional allocations for Kochi Metro, Chennai Metro Phase 2, Bengaluru Metro Phase 2A and B, Nashik and Nagpur Metros
- National Hydrogen Mission to be launched to generate hydrogen from green power sources
- Recycling capacity of ports to be doubled by 2024
- Gas pipeline project to be set up in Jammu and Kashmir
- Pradhan Mantri Ujjwala Yojana (LPG scheme) to be extended to cover 1 crore more beneficiaries
Tax:
- No IT filing for people above 75 years who get pension and earn interest from deposits
- The reopening window for IT assessment cases reduced from 6 to 3 years. However, in case of serious tax evasion cases (Rs. 50 lakh or more), it can go up to 10 years
- Affordable housing projects to get a tax holiday for one year
- Compliance burden of small trusts whose annual receipts does not exceed Rs. 5 crore to be eased
- Duty of copper scrap reduced to 2.5%
- Custom duty on gold and silver to be rationalised
- Duty on naphtha reduced to 2.5%.
- Duty on solar inverters raised from 5% to 20%, and on solar lanterns from 5% to 15%
- All nylon products charged with 5% customs duty
- Tunnel boring machines to attract customs duty of 7%
- Customs duty on cotton raised from 0 to 10%
- Agriculture infrastructure and development cess proposed on certain items including urea, apples, crude soyabean and sunflower oil, crude palm oil, kabuli chana and peas
Economy and Finance:
- The fiscal deficit stands at 9.5% of the GDP; estimated to be 6.8% in 2021-22
- Proposal to allow States to raise borrowings up to 4% of GSDP this year
- A Unified Securities Market Code to be created, consolidating provisions of the Sebi Act, Depositories Act, and two other laws
- Proposal to increase FDI limit from 49% to 74%
- An asset reconstruction company will be set up to take over stressed loans
- Deposit insurance increased from Rs 1 lakh to Rs 5 lakh for bank depositors
- Proposal to decriminalise Limited Liability Partnership Act of 2008
- Two PSU bank and one general insurance firm to be disinvested this year
- An IPO of LIC to debut this fiscal
- Strategic sale of BPCL, IDBI Bank, Air India to be completed
Agriculture:
- Agriculture infrastructure fund to be made available for APMCs for augmenting their infrastructure
- 1,000 more Mandis to be integrated into the E-NAM market place
- Five major fishing hubs, including Chennai, Kochi and Paradip, to be developed
- A multipurpose seaweed park to be established in Tamil Nadu
Employment:
- A portal to be launched to maintain information on gig workers and construction workers
- Social security to be extended to gig and platform workers
- Margin capital required for loans via Stand-up India scheme reduced from 25% to 15% for SCs, STs and women
