Union Budget 2021 India Latest Updates : Business2Business

by B2B Desk 2021-02-01 07:44:38

Ms. Sitharaman quotes Rabindranath Tagore: "Faith is the bird that feels the light when the dawn is still dark."

She also compared the economic recovery with that of India's series win in Australia. "The incredible success of Team India in Australia reminds us of the strengths of the people of India."

Ms. Sitharaman says that India experiences contractions only three times. This time it was due to the global pandemic.

For Atmanirbhar Bharat

Finance Minister Nirmala Sitharaman reads Part A of the budget 2021. She says BUdget Part A will lay the vision for Atmanirbhar or Self reliant nation.

"Atmanirbhar is not a new word for India. Ancient India was largely self-sufficient and equally was the epicenter of the world."

She says that vision outlines 13 points, the first of which is health and wellness. We will promote three areas: preventive, curative, and wellness.

Health & Wellness

Central sponsored a scheme called PM Atma Nirbhar Swasthya Bharat Yojana at the outlay of Rs. Rs 64,180 crore for six years to develop primary, secondary, and tertiary healthcare systems.

This will be in addition to the National Health Mission and will support 17,000 rural health centers and 11,000 urban health centers.

The government plans to establish critical healthcare hospital blocks in 602 districts.

We will launch the mission Poshan 2.0 to improve nutritional outcomes across 112 aspirational districts.

The Jal Jeevan Urban Mission will be launched and run for five years with an outlay of Rs 2.87 lakh crore.

Urban Swachh Bharat's mission will be implemented over five years.

To tackle the burgeoning air pollution problem, I am allocating Rs. 2,217 crore for 32 urban centers, says Finance Minister

Rs 35,000 crore has been allocated for COVID-19 vaccines and intend to provide further funds if required.

Physical and Financial Capital and Infrastructure

For a $ 5 trillion economy, our manufacturing sector should grow in double digits for a sustained period, says Finance Minister Nirmala Sitharaman.

To achieve this, a PLI chart has been announced for 13 sectors. This government has committed Rs 1.97 lakh crore over the next 5 years.

Recalling earlier performance-linked schemes announced for the manufacturing sector, she said that in addition to that seven textile parks will be added in the next three years.

The National Infrastructure Pipeline (NIP) was launched with 6,835 projects, which has now been expanded to 7,400 projects.

The NIP will require a substantial increase in funding from both the government and the financial sector. I will take concrete steps to do this: create an institutional structure, monetizing assets, and increase the share of infrastructure spending in the central and state budgets.

"I will introduce a bill to set up Development Finance Institution, and have provided Rs 20,000 crore for this. We should have a lending portfolio of Rs. 5 lakh crore in three years' time," she says.

Asset monetisation

Ms. Sitharaman announced that a national monetization pipeline will be launched and a dashboard will be created to overlook the progress.

"The Monetising operating public infrastructure assets is an important financing option for the construction of new infrastructure. A national monetisation pipeline will be launched, with a dashboard to track the progress and provide visibility to investors," she says.

The next lot of airports will be monetised for operation and management.

3,900 km of National Highway laws will come up in Tamil Nadu. 1,100 km of National Highway works in Kerala, including 600 km in Mumbai-Kanyakumari corridor. 600 km corridor in West Bengal. Rs.34,000 crore covering over 1000 km will be taken up in Assam, she says. It may be noted these four States will be witnessing Assembly elections later this year.

She also says that I am providing an enhanced outlay of Rs 1,18,101 crore for ports and highways, she says.

New voluntary scrappage policy

Union Finance Minister announces a new voluntary scrappage policy to phase out old vehicles. Details will be revealed later. The auto industry has long waited for a scrappage policy. Tamil Nadu is a great market for commercial and personal vehicles that are likely to benefit. Sanjay Vijayakumar

National Rail Plan

The National Rail Plan has been created to bring a future-ready rail system by 2030.

The Somnagar Gomu section of the Eastern Dedicated Corridor will be taken this year. She says the Eastern and Western Freight corridors will be ready by 2022.

The 100% electrification will be completed in 2023. Vistadome coaches in all tourist corridors.

Metro services in 27 cities

MetroLite and MetroNeo will be introduced in Tier 2 cities and peripheral areas of Tier 1 cities.

Kochi Metro, Chennai Metro Phase 2, Bengaluru Phase 2A and B, Nashik and Nagpur Metro get an additional allocation.

"We will work to increase the participation of public transport in urban areas by expanding metro networks and augmentation of city bus services," Ms. Sitharaman says.

The scheme will facilitate the deployment of innovative PPP models to enable private actors to supply and operate more than 20,000 buses.

A total of 702 km of conventional metro is operational and another 1,016 of metro and RRTS is under construction in 27 cities.

Power

In a bid to end the monopoly of power distribution, the government will create a framework that allows consumers of electricity alternatives to choose from more than one distribution company.

A comprehensive National Hydrogen Mission is being launched for generating hydrogen from green power sources.

Shipping and ports

The finance minister said major ports will be moving from providing operational services on their own to a system that private actors will manage it for them.

Approximately 90 ship recycling yards at Alang in Gujarat are compliant with the latest international norms. Recycling capacity will double by 2024, this will generate an additional 1.5 lakh jobs for our youth.

The gas pipeline project will be executed in the Union Territory of Jammu and Kashmir.

The City Gas Distribution (CGD) program will be extended to 100 districts in the next three years.

The Ujjwala (LPG) scheme, which has benefited 8 crore households thus far will be extended to cover 1 crore more beneficiaries.

Financial Capital

I propose to consolidate the provisions of the SEBI Act, Depositories Act, and two other laws, into a Unified Securities Market Code, says Nirmala Sitharaman.

Towards investor protection, I propose to introduce an investor charter as a right for all investors in all financial products.

I propose to amend the Insurance act to increase the FDI limit from 49% to 74%.

The high level of provisions by public sector banks requires measures to clean up their books. An asset rebuilding company will be created to take over the distressed loans. Reconstruction and asset management companies will be created to create value.

Deposit Insurance: The government has approved an increase in the cover from Rs 1 lakh to Rs 5 lakh for bank depositors. I shall move the adjustments amendments to streamline the provision so that depositors can easily and temporarily limit their savings within the limits of deposit insurance. This will help depositors in banks that are currently under pressure.

The decriminalisation of offenses under the Companies Act is now complete. I now propose to complete the decriminalisation of the Limited Liability Partnership Act of 2008.

Disinvestment and strategic sale

Two PSU banks and one general insurance firm will be disinvested this year. An IPO of LIC will be debuted this year.

Idol assets will not contribute to Atmanirbhar Bharat. She says the Monetising of the land will be taken up. A SPV will be launched to carry out this activity.

She says that in due course a revised mechanism will be introduced for timely closure of loss-making PSUs.

"In spite COVID-19, we have continued to work towards the strategic sale of BPCL, IDBI Bank, and Air India, which will be completed in 2021-22," she says.

Niti Aayog has been asked to draw up a list of companies that may be disqualified from investing later ... and she adds that the estimated income at Rs 1.75 crore as receipts from disinvestment in 2021-22, she adds.

Agriculture and rural development

Ms. Sitharaman says that our government is committed to the well-being of farmers amid thumping from Treasury and sloganeering by Opposition.

She says the MSP has increased to 1.5 times. She reads out more data on farm procurement.

In the case of wheat, the total amount paid to farmers in 2013-14 was Rs 33,874 crore. In 2019-20, 62,804 crore was Rs. In 2020-2021, this payment to farmers was Rs 75,050 crore. The number of wheat growing farmers benefite increased to 43.36 lakh compared to 35.57 lakh in 2019-20.

For paddy, the amount paid in 2013-14 was Rs 53,928 crore. In 2019-20, this increased to Rs 1.41 Lakh Crore. Even better, in 2020-21, it is estimated to increase to Rs. 1,72,752 Crore.

She said that the Agricultural Infrastructure Fund will be available for the CMPAs to strengthen their infrastructure. One of the main arguments against the new farm laws is that these laws will end the CMPA.

An additional 1,000 Mandis will be integrated into the E-NAM market place.

Five major fishing hubs will be developed as hubs of economic activity, including Chennai, Kochi, and Paradip.

To promote seaweed farming, I propose a multipurpose seaweed park to be established in Tamil Nadu.

Migrant workers and labourers

We launched the One Nation Card to help migrant workers. I am pleased to inform you that the ON, OR plan is being implemented by 32 states and union territories that number approximately 59 crore beneficiaries.

I propose to launch a portal to keep information on construction workers and construction workers, and this will help bring benefits to migrant workers.

Social security will be extended to gig and platform workers. This will be guaranteed by the four new labour codes.

Night shift workers will be allowed adequate protection.

To further facilitate the credit flows for SCS and SCS for Standup India scheme for SCs, STs and women, I propose to reduce the margin capital required for loans from 25% to 15%.

We have taken a number of measures to help the MSMEs sector on this budget with an allocation of Rs 15,700 crore, more than double that of last year.

Education

1,00 Sainik School will be set up. The 750 Eklavya school will be set up in tribal areas.

A central university will be established in Ladakh.

More than 15,000 schools will be strengthened under NEP 2020.

An "umbrella" structure will be created for central higher education institutions in different cities, such as Hyderabad.

Sensex in green

Investors have welcomed the Union Budget with cheers as the benchmark stock indices rallied close to 2% by noon.

The market rally helped boost the overall market capitalization of stocks by about 0.75% this morning.

The biggest gainers have been banks and non-bank financial companies, which have been boosted by the Finance Minister's announcement that the Centre will set up the equivalent of a 'bad bank' to help revive the banking sector from the bad loan crisis

Minimum government and maximum governance

We have taken a number of steps to bring reforms in tribunals, which I will further rationalise this year.

To have ease of doing business for those who deal with government companies or central PSEs, I propose a system for a swift resolution of contractual disputes.

The next census will be the first digital census in history. Therefore, I have allocated Rs 3,758 crore in this year.

I propose to grant Rs 300 crore to the Goa government to celebrate 50 years of liberation.

Rs.1000 crore for the welfare of tea workers, especially women and children, in Assam and West Bengal

Fiscal deficit pegged at 9.5% of GDP

In these few paragraphs of Part A of my speech, I pointed out to this august House to the fact that at the beginning of this fiscal year, the pandemic had weakened the flow of income, says Ms. Sitharaman.

Unlike many other countries, we chose a series of medium-sized packages during the pandemic so that we can calibrate our response according to the situation.

Once the health situation stabilized, we acted to boost demand.

The fiscal deficit was set at 9.5% of GDP. We have financed this through government loans, multilateral funds, and short-term loans. We need another Rs 80,000 crore for which we will approach the market in the next few months.

For 2021-22, we are estimating a fiscal deficit of 6.8% of GDP. The gross borrowing from the market next year is expected to be â‚¹12 lakh core.

We expect to achieve consolidation of debt by increasing buoyancy of tax revenues and increased receipts from asset monetisation.

We propose to allow states to raise loans of up to 4% of GSDP in 2021-22, based on the recommendations of the Fifteenth Finance Committee, of which a part should be earmarked for incremental capital expenditure.

The FRBM will be amended to allow for the deviation, as the Act mandates a fiscal deficit of 3% of GDP by March 31, 2021.

Based on the recommendations of the Fifteenth Finance Committee, the government decided to retain the States' vertical share of the divisible pool of revenues at 41%. The funds for the union territories of Jammu and Kashmir and Ladakh will be provided by the Centre.

In addition, based on the committee's recommendations, we have allocated a revenue deficit grant of Rs 1,18,452 crore to 17 states, compared to Rs 74,340 crore paid to 14 countries in 2020-21.

Relief for senior citizens: Many of them, despite giving up many of their basic needs, have strived to build our nation. We shall reduce compliance burden on those above 75 years. This means people above 75 years, who get pension and earn interest from deposits need not file IT returns.

Currently, the assessment can be reopened for a period of six years. This period has been reduced to three years. In serious tax evasion cases, when the concealment of income exceeds Rs.50 lakh per year, it can be opened for up to 10 years.

Affordable housing projects will get a tax holiday for one more year.

The compliance burden of small trusts whose annual receipts do not exceed â‚¹5 crores will be eased.

PF deductions

We have noticed that some employers deduct contributions from employees' salaries towards provident fund and other social security systems, but do not remit them in time.

This means a loss of interest and income for the employees and trouble if the employer becomes unviable going forward.

To ensure that contributions are remitted on time, I reiterate that late filing of contributions as a deduction for employers will not be allowed.

GST, customs

We have seen record GST collections in the last two months. As chairperson of the Goods and Services council, I want to assure this house that we will take every possible step to further improve the GST structure and eliminate deviations such as inverted task structures.

A revised custom duty structure is on the anvil.

I now propose to review over 400 old exemptions this year. We will do this through extensive consultation and a revised customs duty structure free of distortions will be in place from October 1.