Union Budget 2021: Top 10 Takeaways For Atmanirbhar Bharat Budget

Key takeaways of Modi 2.0 government's third Union Budget, announced by Finance Minister Nirmala Sitharaman.

On February 1, 2021, Finance Minister Nirmala Sitharaman presented her third Union Budget on behalf of the NDA-2 government.

Breaking away from the traditional 'bahi-khata', the finance minister read out this year's budget from a 'made in India' tablet computer, making it the first paper-less budget announcement in India.

In the first part of her speech, Sitharam mentions 6 pillars for the budget - health and wellbeing, infrastructure, inclusive growth, human capital, R&D and minimum government, maximum governance; following which she moves onto proposed changes in taxation.

Also Read: Union Budget 2021 Live Blog: No Changes In Personal Tax Slabs

Here are the key takeaways from her speech:

1. Taxation

  • Reduced tax burden for senior citizens, pensioners over 75 years of age exempted from filing returns.
  • Faceless dispute resolution mechanism for small taxpayers.
  • Tax audit threshold increased to Rs.10 crore from Rs. 5 crore (for those transacting 95% digitally)
  • Timeline for reopening of tax returns reduced to 3 years from 6 years.
  • Tax holiday for aircraft leasing companies, start-ups, developers of affordable housing
  • GST - anomalies like inverted duty structure to be removed. 400 old exemptions under customs duty to be reviewed.
  • Relief for NRI - rules to remove double tax for NRIs for foreign retirement funds.
  • Dividends to be exempted from TDS.
  • Changes in customs duty policy - cutting duty on copper scrap to 2.5%, Naptha duty reduced to 2.5%, duty on shrimp feed increased to 15%, duty on cotton raised to 10%
  • Introduction of Agri Infrastructure Development Cess - Rs. 2.5/litre on petrol, Rs. 4/litre on diesel, 2.5% on gold, silver and dore, 100% on alcoholic beverages, 17.5% on crude palm oil.

2. Health And Well-being

  • Rs. 35,400 crore for COVID-19 vaccines for FY22
  • Rs 64,180 crore to be spent by centre on healthcare over six years
  • Universal water supply under Jal Jeevan Mission - Rs. 2.87 lakh crore to be spent in 4378 urban and local bodies over six years.
  • Urban Swachh Bharat Mission 2.0 to be launched outlay of nearly ₹1.5 lakh crore over five years.
  • Announcement of Voluntary vehicle scrapping policy; Fitness tests for personal vehicles older than 20 years and commercial vehicles older than 15 years - phased out if requirements not met.
  • Budget outlay for health and wellbeing announced at Rs. 2.23 lakh crore - Sitharaman calls it a 137% increase from previous year.

3. Financial Capital

  • Centre to introduce bill to set up a Development Finance Institution (DFI), capitalised with Rs 20,000 crore.
  • Capital expenditure in FY22 to go up 44.5% at Rs. 5.54 lakh crore.
  • Proposal for New Rationalised Securities Markets Code
  • Government to privatise 2 PSU banks and one general insurance company in FY22
  • LIC to come up with IPO in FY22

4. Agriculture, Rural Infra, Migrant Labour

  • Raise provision to rural infrastructure development fund to Rs 40,000 crore from Rs 30,000 crore
  • Proposal of 5 major fisheries hubs; to develop harbours and fish planting centre.
  • Micro irrigation corpus to be doubled to Rs 10,000 crore.
  • Agriculture infrastructure fund to be made available to APMCs to augment infrastructural facilities
  • Minimum wages applicable to all workers; social security benefits to be extended to gig and platform workers.

5. Infrastructure

  • 3500 national highway corridor in Tamil Nadu; Rs. 65,000 for 1100 km in Kerala; Rs. 95,000 crore for road projects in West Bengal; and 1300km road projects in Assam over three years.
  • Rs. 1.15 lakh crore dedicated to railway projects, R.s 1.07 lakh crore towards capital expenditure; National Rail Plan for 2030.
  • Airports to be privatised in tier 2 and tier 3 cities.
  • GAIL Ltd, Indian Oil Corp and HPCL pipelines to be monetised.
  • Rs 1.41 lakh crore to be spent on Urban Clean India Mission

6. Power, Petrol And Natural Gas

  • Reforms-based result-linked power distribution sector scheme to be launched with outlay of Rs. 3.06 lakh crore over 5 years.
  • 100 more districts in next 3 years to the City Gas Distribution network.
  • Gas pipeline project to be taken up in Union Territory of Jammu & Kashmir.
  • Independent Gas Transport System Operator to be set up for facilitation and coordination of booking of common carrier capacity in all-natural gas pipelines on a non-discriminatory open access basis

7. Startups, MSMEs

  • Doubled allocation for MSMEs, Rs. 15,700 crore allocated for FY22.
  • Proposal to reduce margin money requirement for startups from 25% to 15%

8. Education

  • 100 new Sainik Schools to be set up in partnerships with NGOs
  • Central University to be set up in Leh, Ladakh.
  • 15,000 schools to be strengthened under the National Educational Policy 2020.
  • Centre to spend Rs. 50,000 crore on National Research Foundation over five years.
  • Legislation for setting up of higher education commission to be introduced.

9. Government Borrowing And Expenditure; Fiscal Deficit

  • Government to borrow Rs 80,000 crore in the next two months to meet expenditure for current fiscal year.
  • Government to borrow Rs 12 lakh crore in FY22 with expenditure pegged at Rs 34.83 lakh crore, which includes Rs 5.54 lakh crore of capital spending.
  • FY21 fiscal deficit pegged at 9.5% of GDP; FY22 fiscal deficit target at 6.8% of GDP; Fiscal deficit to reduce to 4.5% by FY26

    10. Space And Deep Ocean

  • Launching of Deep Ocean mission with allocation of Rs. 4000 crore over 4 years
  • New Space India Limited, a PSU under Department of Space to execute the PSLV-CS51 launch carrying the Amazonia Satellite from Brazil, along with a few smaller Indian satellites.
  • "As part of the Gaganyaan mission activities, four Indian astronauts are being trained on Generic Space Flight aspects, in Russia," Sitharaman added.
Also Read: Myanmar Coup: Military Declares 1 Year Emergency; Suu Kyi Detained

Updated On: 2021-02-01T17:54:41+05:30
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