For the first time ever in the history of independent India, Finance Minister Nirmala Sitharaman presented the annual Union Budget 2021-22 in a paperless manner reading her speech from a tablet.
The Finance Minister commenced her budget address with a brief on the year 2020 and how unprecedented conditions caused due to COVID-19 pandemic have impacted the economy. She said, “The three Aatmanirbhar Bharat packages and the PMGKY package were a type of mini budgets that were released in the year 2020 to aid the people affected from the COVID crisis.”
Considering the economic condition of the country and a dire need to uplift the healthcare sector to overcome the pandemic, the latest Budget brought in various reforms and benefits for different sectors.
Highlights of the Union Budget 2021-22:
Addressing about Health sector, the FM said, “The total budget outlay for the Healthcare sector is Rs 2.23 lakh crore. This is 137per cent more than the last year’s budget.”
Moreover, the supplementary programme and the ‘poshan abhiyan’ will be merged and Poshan Abhiyan 2.0 will be launched to enhance nutrition to children, especially those from the poor sects of the society.
In a major announcement for the health sector, the FM said, “Rs 64,180 crore will be invested over 6 years to improve primary, secondary and tertiary healthcare in addition to the National Health Mission.”
Further, she announced, “We will introduce a bill to set up a developmental Financial Institution with a budget of Rs 20,000 crore.” Also, she proposed a sharp increase in capital expenditure at Rs 5.54 lakh crore in 2022 from Rs 4.39 lakh crore in 2021.
Speaking on the development of roads and highways, the FM said, “The Centre aims to complete 11,000 km of national highways infrastructure in 2021. Moreover, major highway projects will be taken up in the states of Tamil Nadu, Kerala, West Bengal and Assam.”
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Addressing the Railways she announced, “I am allocating a record sum of Rs 1.10 lakh crore outlay for Railways, of which Rs 1.7 lakh crore is for capital expenditure only.”
Further, she mentioned about Hydrogen Energy Mission that the Government of India would be taking up under which hydrogen gas will be generated from eco-friendly or green-powered sources. Adding to her address to the renewable energy sector, she informed that a sum of Rs 1,000 crore has been earmarked for solar energy corporation and Rs 1,500 crore for the renewable energy development agency.
She announced, “Gas pipeline project will be taken up in the Union Territory of Jammu and Kashmir.” Besides this, 100 more cities will be added in the next three years to the gas distribution network, the FM added.
Addressing the finance sector, the FM stated, “A further infusion of Rs 20,000 crore will be provided for the public sector banks.” Additionally, she said, “We propose to take up two PSU banks & a public sector insurance company for disinvestment… The Government’s disinvestment revenue target of 2022 is Rs 1.75 lakh crore.”
Speaking on the much-awaited Agriculture sector, the FM pointed out, “Over Rs 75,000 crore had been paid to wheat farmers in 2020-21 and 43.36 lakh farmers have benefited from this.” With this, she announced a proposal to increase the agriculture credit target to Rs 16.5 lakh crore.
In another historic announcement the FM stated, “For the first time, social security benefits will be extended to gig and platform workers.” Also, the forthcoming census in 2021 would be the first-ever digital census of India, she added.
Speaking on the Education sector, she informed, “We will be qualitatively strengthening over 15,000 schools under the National Education Policy.”
Talking about fiscal deficit she said, “In RE 2020-21, the fiscal deficit pegged at 9.5 per cent of the GDP whereas the fiscal deficit in BE 2021-22 was at 6.8 per cent of the GDP. Our aim is to bring the fiscal deficit below five per cent of the GDP by 2025-26.”
The FM also tabled a proposal to increase the contingency fund to Rs 30,000 crore during her budget presentation.
Announcing further relief to MSMEs, she increased the capital expenditure for MSMEs to Rs 15.17 thousand crores which is the double of the expenditure proposed last year.
Speaking on tax exemptions she announced, “We shall reduce the compliance burden on senior citizens. Therefore, for senior citizens who only have a pension and interest income, I propose exemption of filing of income tax returns.” Apart from this, she announced an increase in tax audit limit from Rs 5 crore to Rs 10 crore. Also, the FM tabled a proposal to make dividend payments to Real Estate Investment Trusts (REIT) and Infrastructure Investment Trusts (Invits) free of TDS. Additionally, the FM also increased the Foreign Direct Investment (FDI) in the insurance sector from 49 per cent to 74 per cent.
To ease the filing of Income Tax returns, the FM announced that the details of capital gains and interests from banks, post offices, etc. will be pre-filled.
While concluding her speech she threw light on changes in the customs duties. She announced, “Customs duty on solar lanterns has been reduced to five per cent. Moreover, customs duty on cotton and auto parts has been increased to 10 per cent and 15 per cent respectively. However, the customs duty on copper scrap has been reduced to 2.5 per cent.”
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