BUDGET 2017 AT GLANCE

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Finance minister Arun Jaitley presented the Union Budget 2017-18 in the Lok Sabha on 1-02-17. Here are the highlights of the Union Budget.

Jaitley divided his budget proposal into 10 distinct themes: Farmers; rural population; energizing youth; poor and underprivileged; infrastructure; financial sector; digital economy; public service; prudent fiscal management; and tax administration.

OPENING SPEACH:

  1. India stands out as a bright spot amid world economic gloom.
  2. Our focus will be on energising youth to reap benefits of growth and employment.
  3. IMF estimates world GDP will grow by 3.4 per cent in 2017.
  4. Oil prices, rising dollar and volatile commodity prices seen as risks to Indian economy.
  5. India is seen as engine of global growth, have witnessed historic reform in last one year.
  6. Demonetisation is a bold and decisive measure, for many decades tax evasion was a way of life for many.
  7. Note ban is expected to have only a transient impact on economy.
  8. I am reminded of what our father of the nation Mahatma Gandhi said: “A right cause never fails”.

 

FARMERS:

  1. Farmer credit fixed at record level of Rs10 trillion; will ensure adequate flow to underserved areas.
  2. Soil health cards: Govt to set up mini-labs in Krishi Vigyan Kendras
  3. Long-term irrigation fund in Nabard—corpus at Rs40,000 crore
  4. Model law on contract farming to be circulated
  5. Dairy processing infra fund with corpus of Rs8,000 crore
  6. Dedicated micro-irrigation fund with Rs5,000 crore corpus

 

 RURAL POPULATION:

  1. Mission Antyodaya to bring 1 crore households of poverty
  2. MGNREGA: Rs48,000 crore has been allocated; participation of women now at 55%; using space technology in a big way
  3. Prime Minister Gram Sadak Yojana: Rs19,000 crore allocated; along with states, Rs27,000 crore will be spent in FY18
  4. Pradhan Mantri Awas Yojana: Rs23,000 crore allocated
  5. 100% village electrification by May 2018
  6. Rural livelihood mission: Rs4,500 crore allocated
  7. Mason training to be provided for 5 lakh people
  8. Panchayat Raj: Human resource reform programme to be launched
  9. Rs1,87,223 crore allocated for rural programmes

 

YOUTH:

  1. Education: System of measuring annual learning outcomes, emphasis on science
  2. Innovation fund for secondary education
  3. Reforms in UGC: Colleges to be identified based on ranking and given more autonomy
  4. Propose to leverage information technology with launch of SWAYAM platform for virtual learning
  5. National testing agency to be established for all entrance exams, freeing up CBSE, AICTE and other bodies
  6. 100 Indian international skill centres to be established with courses in foreign languages
  7. Rs4,000 crore allocated to launch skill acquisition and knowledge awareness
  8. Special scheme for creating employment in leather/footwear sector
  9. Tourism: Five special zones to be set up

 

POOR AND UNPRIVILEGED:

  1. Women: Mahila Shakti Kendras with Rs500 crore corpus
  2. Stepped up allocation to Rs1.84 trillion for various schemes for women and children
  3. Affordable housing to be given infrastructure status
  4. Action plan to eliminate leprosy by 2018, TB by 2025, reduce IMR to 29 in 2019
  5. To create additional PG medical seats per annum
  6. Two new AIIMS in Jharkhand and Gujarat
  7. New rules to be introduced for medical devices
  8. Labour rights: Legislative reforms to simplify and amalgamate existing labour laws
  9. Allocation to SCs increased to Rs52,393 crore; STs given Rs31,920 crore, minority affairs allocated Rs4,195 crore
  10. Senior citizens: Aadhaar-based smart cards with health details to be provided

 

INFRASTRUCTURE:

  1. Total capex and development expenditure of railways pegged at Rs1.31 trillion
  2. Railways: Passenger safety—Safety fund corpus set up; unmanned level crossings to be eliminated by 2020
  3. Railway lines of 3,500km to be commissioned
  4. To launch dedicated tourism/pilgrimage trains
  5. 500 stations to be made differently-abled friendly
  6. Cleanliness in railways: To introduce Coach Mitra facility; By 2019, biotoilets for all coaches
  7. Railways to offer competitive ticket-booking facility; service charge withdrawn for tickets booked on IRCTC
  8. New metro rail policy to be announced
  9. Roads sector: Allocation for national highways at Rs64,000 crore
  10. Airports Authority of India Act to be amended to enable monetization of land resources
  11. Total allocation to transport sector at Rs2 trillion
  12. Telecom sector: Allocation to Bharat Net programme at Rs10,000 crore
  13. Digi-gau initiative to be launched
  14. To make India global hub for electronics manufacture
  15. Export infra: New restructured central scheme to be launched
  16. Total allocation for infrastructure: Rs3.96 trillion

 

FINANCIAL SECTOR:

  1. Foreign Investment Promotion Board (FIPB) to be abolished
  2. Commodities market: panel to study legal framework for spot and derivative markets
  3. Resolution mechanism for financial firms
  4. Cyber-security: Computer emergency response team to be set up
  5. Listing of PSEs will foster public accountability; revised mechanism for time-bound
  6. To create integrated public sector oil major
  7. New ETF to be launched
  8. Pradhan Mantri Mudra Yojana: Lending target at Rs2.44 trillion
  9. Stand-up India scheme: over 16,000 new enterprises have been set up

 

DIGITAL ECONOMY:

  1. India at cusp of massive digital revolution
  2. Govt to launch two new schemes to promote BHIM app, including cashback scheme for merchants
  3. Aadhaar Pay to be launched for people who don’t have mobile phones
  4. Focus on rural and semi-urban areas
  5. To strengthen financial inclusion fund
  6. Panel on digital payments has recommended structural reforms
  7. To create payment regulatory board at RBI

PUBLIC SERVICES:

  1. To use head post-office for passport services
  2. Defence: centralized defence travel system developed
  3. Defence: Centralized pension distribution system to be established
  4. Govt recruitment: To introduce two-tier exam system
  5. Govt looks to introduce laws to confiscate assets of economic defaulters
  6. High-level panel chaired by PM to commemorate Mahatma Gandhi’s 150th birth anvi.

 FISCAL MANAGEMENT:

  1. Total budget expenditure: Rs21 trillion
  2. Rs3,000 crore to implement various budget announcements
  3. Defence expenditure excluding pensions: Rs2.74 trillion
  4. Consolidated outcome budget for all ministries being created
  5. Fiscal deficit for FY18 pegged at 3.2% of GDP
  6. Revenue deficit for FY18 at 1.9%

 

TAX ADMINISTRATION:

  1. Direct tax collection not commensurate with income/expenditure pattern of India
  2. We are largely a tax non-compliant society; predominance of cash in society enables tax evasion
  3. After demonetization, data received will increase tax net
  4. Black money: No cash transactions above Rs3 lakh
  5. Transparency in political funding: Parties continue to receive anonymous donations; propose system of cleaning up
  6. Political funding: Maximum amount of cash donation that can be received is Rs2,000; political parties can receive donations by cheques or digitally; amendment proposed to RBI Act to issue electoral bonds; every party has to file returns within specified time
  7. Personal income tax: Rate reduced to 5% for income bracket of Rs2.5-5 lakh; All other categories to get uniform benefit of Rs12,500 per person; to levy surcharge on income bracket Rs50 lakh-Rs1 crore
  8. Personal income tax: To have simple one-page form for taxable income up to Rs5 lakh
  9. GST: preparedness of IT system on schedule
  10. Not many changes to excise duties since GST will be implemented soon
  11. FPI category 1 and 2 investors exempted from indirect transfer provisions
  12. Time period of revising tax returns reduced to 12 months
  13. Real estate: to make changes in capital gains tax
  14. Concessional withholding rate will be extended to 30 June 2020, rupee-denominated masala bonds to be included
  15. MAT not to be abolished at present; to allow carry-forward for 15 years
  16. Corporate tax rate: MSMEs’ rate (annual turnover less than Rs50crore) reduced to 25%
  17. LNG: Reduce customs duty to 2.5%
  18. Limit of cash donation for charitable trusts cut to Rs2,000.

 

CLOSING REMARKS:

It is said when my goal is in sight, the winds favour me and I fly. There is no other day more appropriate than this: FM Jaitley

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