Finance Minister Nirmala Sitharaman Budget speech in Parliament of 90 minutes, was her shortest speech during her tenure as the Finance Minister of the country. This was the first time that the Union Budget was presented in a paperless form and was read though a tab instead of the 'bahi-khata' which was first used in 2019.
Economy
- Capex target expanded by 35.4 per cent — from Rs 5.54 lakh crore to Rs 7.50lakh crore. FY23 effective capex seen at Rs 10.7 lakh crore
- India's growth highest among all major economies; we are now in a strong position to withstand challenges
- The goal is complementing macro-growth with micro-all-inclusive welfare,digital economy and fintech, tech-enabled development, energy transition and climate action
- ECLGS cover expanded by Rs 50,000 to Rs 5 lakh crore
- Top focus of the budget this year are: PM Gati Shakti, Inclusive Development, Productivity Enhancement, Sunrise Opportunities, Energy Transition, Climate Action, Financing of investments
- Productivity-linked incentive schemes in 14 sectors have received excellent response; received investment intentions worth Rs 30 lakh crore
- Economic recovery benefitting from public investment and capital spending. This Budget will provide impetus to growth
- In 2022-23, states will be allowed fiscal deficit of up to 4 pc of GSDP
Expenditure and Deficit
- Proposed fiscal deficit of 4.5% of GDP by 2025/26
- Projected fiscal deficit of 6.4% of GDP in 2022/23
- Revised fiscal deficit for 2021/22 at 6.9% of GDP
- 50 year interest free loans over and above normal borrowing allowed for states
- Scheme for financial assistance to states for capital investment outlay to be Rs 1 lakh crore for 2022/23
- Public issue of Life Insurance Corporation expected shortly
- Initiatives from last year's budget have been provided adequate allocations in this budget
- Receipt from disinvestment proceeds in next financial year pegged at Rs65,000 crore, lower than the current year's mobilisation of Rs 78,000 crore.
Taxes
- Govt vows a stable and predictable tax regime
- Govt to provide one-time window to correct omissions in ITRs fi led, updated returns to be fi led within 2 years
- Any cess or surcharge on income not allowed as business expenditure
- 1 per cent TDS on transfer of virtual assets above a threshold, gifts to be taxed
- Surcharge on long-term capital gains capped at 15 per cent
- The government will tax income from digital asset transfers at 30%
- No deduction allowed while computing income except cost of acquisition
- Loss cannot be set off from any other income
- Gift of crypto currencies to be taxed at receiver's end
- A new provision to allow taxpayers to fi le an updated return
- Updated return can be fi led within 2 years from the end of the relevant assessment year.
- Alternate Minimum Tax for cooperative societies to be cut to 15%
- Proposal will reduce surcharge on cooperative societies to 7%, for those whose income is between Rs 1 crore and Rs 10 crore
- Tax deduction limit increased to 14% on employers contribution to NPS account of state govt employees
Duties on Industry
- Import duty on certain chemicals being/to be cut
- Customs duty exemption on steel scrap will be extended for another year for MSMEs
- Will revoke customs duty on stainless steel, fl at products, high steel bars
- Beginning October 2022, unblended fuel to get additional duty of Rs 2/litre
- Import duty on cut and polished diamonds and gemstones to be cut 5 percent and on sawn diamond to nil
- Customs duty concessions to be given to certain consumer electronic devices to promote manufacturing across wearables, hearables and specific mobile phone components
Jobs
- ECLGS extended till March 2023, 60 lakh jobs eyed in next 5 years
- Eff orts of central, state governments leading to jobs, entrepreneurial opportunities
- Digital ecosystem for skilling and livelihood to be launched.
- This will aims to skill, reskill, upskill citizens through online training.
- API based skill credentials, payment layers to fi nd relevant jobs and opportunities
Infrastructure & Manufacturing
- Desh stack e-portal to be launched to promote digital infra
- Strategic transfer of ownership of Air India completed now
- Four multi-modal national parks contracts will be awarded in FY23
- PM Gatishakti masterplan for expressways will be formulated in nextfi nancial year
- 100 PM Gati Shakti terminals to be set up in next three years
- Focus on public investment to modernise infrastructure over the mediumterm, leveraging tech platform of Gati Shakti via a multi-modal approach
- PM Gati Shakti will pull forward the economy and will lead to more jobsand opportunities for the youth
- Concessional corporate tax rate of 15 pc would be available for 1 more yeartill March 2024 for newly incorporated manufacturing companies
Digital Currency
- Launch of blockchain-bassed digital rupee starting 2022-23
- To launch scheme for taxation of virtual digital assets
- Losses from sale of virtual digital assets cannot be off set against otherincome
- Income from virtual digital assets to be taxed at 30%
Housing & Urban planning
- Rs 48, 000 crore is allotted for PM Awas Yojana
- In 2022-23, 80 lakh houses will be completed for identified beneficiaries of PM Awas Yojana; 60,000 houses will be identified as beneficiaries for PM Awas Yojana in rural & urban areas
- 60,000 crore allocated for providing access to tap water to 3.8 crore households
- In 2022-23, 80 lakh households will be identified for the affordable housing scheme
- Rs 60,000 cr allocated to provide tap water connections to 3.8 crore households in 2022-23
- A high-level committee for urban planners and economists to be formed for recommendations on urban capacity building, planning implementation, and governance
- 5 existing academic institutions for urban planning to be designated as Centre for Excellence with endowment fund of Rs 250 cr
- Modern building by-laws will be introduced
- A high-level panel to be set up for urban planning
- Govt to promote use of public transport in urban areas
- Proposal to reduce Minimum Alternative Tax to 15 pc for co-op societies, at par with corporate
MSMEs & Startups
- Rs 6,000 crore programme to rate MSMEs to be rolled out over 5 years
- MSMEs such as Udyam, e-shram, NCS & Aseem portals will be inter-linked, their scope will be widened
- They will now perform as portals with live organic databases providing G-C, B-C & B-B services such as credit facilitation, enhancing entrepreneurial opportunities
- A fund with blended capital raised under co-investment model facilitated through NABARD to finance startups in agriculture & rural enterprises for farm produce value chain
- Startups will promoted for Drone Shakti
- PE/VC invested Rs 5.5 lakh crore in startup, expert committee will be set up to suggest measures to help attract investment
- Existing tax benefits for startups, which were offered redemption of taxes for 3 consecutive years, to be extended by 1 more year
Agriculture
- Govt to pay Rs 2.37 lakh crore towards procurement of wheat and paddy under MSP operations
- 2022-23 has been announced as International Year of Millets
- Railways will develop new products for small farmers and MSMEs
- A rationalised scheme to increase domestic oilseed production will be brought in to cut down imports
- Kisan Drones for crop assessment, land records, spraying of insecticides expected to drive a wave of technology in agri sector
- Ken Betwa river linking project worth Rs 44,605 crore announced
- Draft DPRs for 5 river links have been finalised
- Finance startups to be incentives to aid rural enterprises
- Natural farming will be promoted along Ganga river corridor
- Govt will promote chemical-free natural farming throughout the country to boost sustainable agricultural productivity and income of farmers
- A fund under co-investment model will be facilitated through NABARD tofi nance startups for agriculture and rural enterprise relevant for farm produce value chain
- A completely paperless, e-bill system will be launched by ministries for procurement
- Financial support will be provided to farmers to take up agro-forestry
Electric Vehicles
- Battery swapping policy to allow EV charging stations for automobiles will be framed
- Private sector will be encouraged to create sustainable and innovative business models for battery and energy as a service, improving the efficiency in the EV ecosystem
- Education & skilling
- States to be encouraged to revise syllabi of agricultural universities to meet needs of natural, zero-budget & organic farming, modern-day agriculture
- One class, one TV channel' program of PM eVIDYA will be expanded from12 to 200 TV channels
- This will enable all states to provide supplementary education in regional languages for classes 1 to 12
- Digital university to be set up to provide education; to be built on hub and spoke model
- 1-Class-1-TV Channel to be implemented to provide supplementary education to children to make up for loss of formal education due to Covid
- To launch National Skill Qualification Framework (NSQF) to cater to dynamic industry needs
Finance & Inclusion
- Rs 1 lakh crore financial assistance to states to be provided in 2022-23 to catalyse investments
- Proposed to introduce Digital Rupee by RBI using blockchain technology, starting 2022-23
- Measures will be taken to step up private capital in infra sector
- Rupee to be rolled out by 2023
- 100% of 1.5 lakh post off ices will come on the core banking system, enabling financial inclusion and access to accounts through net banking, mobile banking, ATMs, and also provide online transfer of funds between post office accounts and bank accounts
- This will be helpful especially for farmers and senior citizens in rural areas enabling inter-operability, and financial inclusion.
- IBC amendments to enhance efficiency of resolution process
- Facilitate cross-border insolvency resolution
- 75 digital banks in 75 districts will be set up by scheduled commercial banks to encourage digital payments
- International arbitration centre will be set up in GIFT city to provide faster dispute resolution
- World-class university to be allowed in GIFT IFSC free from domestic regulation, says FM
Healthcare
- An open platform for the national digital health ecosystem will be rolle out
- It will consist of digital registries of health providers and health facilities, unique health identity and universal access to health facilities
- 95 per cent of 112 aspirational districts have made significant progress in health, infra
- For mental health counselling, a National Tele Mental Health Program will be launched
Telecom
- Spectrum auction will be conducted in 2022 for the rollout of 5G
- Scheme for design led manufacturing to be launched for 5G ecosystem as part of PLI scheme to enable affordable broadband and mobile communication in rural and remote areas
- 5 pc of USO Fund to be provided for R&D and technology upgradation
- Contracts for laying optical fi bre in villages to be awarded under BharatNetproject under PPP in 2022-23
- Data centre and energy storage system to be given infrastructure status; move to provide easy financing
- To award contracts to lay optical fibre in rural areas, completion in 2025
Women & Children
- Recognising the importance of 'Nari Shakti', 3 schemes were launched to provide integrated development for women and children
- 2 lakh Anganwadis to be upgraded for improving child health
- Ease of Business & living
- 75,000 compliances have been eliminated and 1,486 union laws repealedto make it easier for businesses
- India to launch the next phase of Ease of Doing Business EODB 2.0 andEase of Living.
- Voluntary exit for corporates to be cut down to 6 months from 2 years
- Special Economic Zones Act to be replaced with new legislation
Defence
- Govt committed to reduce import and promote self-reliance in defence sector
- 68 per cent of capital for defence sector to be earmarked for local industry
- Defense R&D will be opened up for industry, startups and academia with25% of defense R&D budget
- Private industry will be encouraged to take up the design and development of military platforms and equipment in collaboration with DRDO and other organizations through SPV model
- 68% of capital procurement budget in defence will be earmarked for domestic industry in 2022-23 (up from the 58% last fiscal)
Transportation including Railways
- 400 new generation Vande Bharat trains to be manufactured in next 3years
- 2,000 km of rail network to be brought under indigenous technologyKAWACH for safety and capacity augmentation
- 400 energy eff icient trains to be manufactured over next three years
- National highways network to be expanded by 25,000km in 2022-23
- Highways expansion to cost Rs 20,000 crore in 2022-23
- One product one railway station will be popularised
Climate & Net Zero
- Energy transition and action on climate to be major priority for govt
- Risks of climate change are strongest externalities for the world
- Funds will be used for projects that will help reduce carbon intensity of the economy
- Low carbon development strategy opens up employment opportunity
Travel
- ePassports will be rolled out in 2022-23 for convenience in overseas travel
- E-passport with embedded chip will be rolled out
Other Measures
- Task force on animation visual effects, gaming, comic promotion to be set up
- Villages on northern border of India will be covered under a new vibrant village programme to enhance development
- A new scheme called PM Development Initiative for North East to be launched
- National Ropeways Development Programme to be taken up in PPP mode with the aim to improve connectivity, besides promoting Tourism
- Sovereign green bonds to be launched to fund green infra, to be part of government’s borrowing programme in FY23
- Proceeds to be deployed in public sector projects 4 pilot projects for coal gasification to be set up
- Rs 19,500 cr additional allocation for PLI for manufacturing high efficiency solar modules has been made
