Union Budget 2021: Sector wise highlights

New Delhi, Feb 01: Union Minister Nirmala Sitharaman today presented the Union Budget 2021. Here are the sector wise highlights of the Budget.

MAIN PILLARS OF BUDGET 2021

Main pillars of Budget 2021-Health, Human capital, Innovation and R&D, Physical infrastructure.

ATMANIRBHAR BHARAT

• The total impact of Atmanirbhar Bharat and measures by RBI was Rs 27.1 lakh crore, which amounts to 30 per cent of GDP.
• The budget proposals of Part A will strengthen the 'sankalp of Aatmanirbhar Bharat'.
• The focus will be on 6 pillars, which include health & well-being, inclusive development, human capital, innovation and R&D.

HEALTH

Pradhan Mantri Atma Nirbhar Swasthya Bharat Yojana

• The government has announced a new central healthcare scheme to strengthen the country's healthcare infrastructure over the next six years.
• The Pradhan Mantri Atma Nirbhar Swasthya Bharat Yojana, which will operate in addition to the existing National Health Mission, has been allocated around Rs 64,180 crore.
• This scheme is expected to be used to develop capacities of primary, secondary and tertiary healthcare systems as well as existing national institutions over a period of six years.

FY22 outlay (budget estimate) for health

• The FY22 outlay (budget estimate) for health and well-being is up 138%, at Rs 2,23,846 cr. Of this, Rs 35,000 crore will be spent on the Covid-19 vaccine.

Aatmanirbhar Swastha Bharat

• Focus on Swacch bharat and swasth bharat. PM Aatmanirbhar Swastha Bharat to be launched with an outlay of 64,180 cr over 6 years. "Intend to focus on reduction of single use plastic, air pollution and segregation of waste.

Mission Poshan 2.0

• Government to launch Mission Poshan 2.0; Jal Jeevan Mission Urban will be launched.

Urban Swachh Bharat scheme

• The Urban Swachh Bharat scheme will be implemented with an outlay of over Rs 1.4 lakh crore.

AGRICULTURE

Increase in agriculture credit target to Rs 16.5 lakh crore

• FM Sitharaman proposes increase in agriculture credit target to Rs 16.5 lakh crore. "The MSP regime has undergone a change to assure price that is at least 1.5 times the cost of production across all commodities. Total amount paid to paddy farmers surged to Rs 1.72 lakh crore in 2020-21."
• 1,000 more mandis will be integrated with electronic national market.
• Operation green scheme to cover 22 more perishable commodities

EDUCATION

• National Education Policy got a good reception
• National Education Policy got a good reception. Over 15,000 schools to be qualitatively strengthened under National Education Policy.

SOCIAL SECURITY

Social Security net for gig workers

• Social security benefits to be extended to gig and platform workers. Minimum wages will apply to all categories of workers and will be covered under ESIC.

Portal to collect info on gig-workers, building and construction workers

• To further extend efforts towards unorganised labour force, proposed to launch a portal to collect relevant information on gig workers, building/construction workers among others. It'll help formulate health, housing, skill, insurance credit &food schemes for migrant workers.

Rs 1,000 crore for Bengal, Assam tea workers

• FM announces special scheme for welfare of women and children in Assam and West Bengal. Rs 1,000 crore for Bengal, Assam tea workers.

INFRASTRUCTURE

Govt committed to welfare of farmers

• Government is committed to welfare of farmers. MSP has gone through a sea change. Over Rs 75,000 crore paid to wheat farmers in 2020-21, 43.36 lakh benefited from this.

National Infrastructure Pipeline

• 217 projects worth over Rs 1 lakh crore completed under National Infrastructure Pipeline.

Development Financial Institution (DFI) reborn

• Will be tabled a bill on DFI essentially to fill the gap in long-term finance for infrastructure sectors. Professionally managed Development Financial Institution with Rs 27,000 crore capital.

RAILWAY

Rs 1.10 lakh crore outlay for railways

• About Rs 1.10 lakh crore outlay for railways, of which Rs 1.7 lakh crore is for capital expenditure.
• Railways to monetize dedicated fright corridor assets for operations and maintenance after commissioning

INFRASTRUCTURE

More economic corridors being planned to boost road infrastructure

• "For 2022, proposed a sharp increase in capital expenditure at 5.54 lakh crore, from Rs 4.39 lakh crore in 2021. More economic corridors being planned to boost road infrastructure.

To complete 11,000 km of national highway infrastructure this year

• Highway works proposed: 3,500 km corridor in Tamil Nadu. 1,100 km in Kerala at investment of Rs 65,000 cr. 675 km in West Bengal at a cost of Rs 95,000 cr. 1,300 km in Assam in the next 3 years.

Allocation to rural infra development increased

• Allocation to rural infra development increased to Rs 40,000 cr in next fiscal from Rs 30,000 crore in FY21

TRANSPORT

Centre to provide Rs 18,000 crore for public buses

• FM announces Rs 18,000 cr scheme to augment public transport in urban areas

Rs 95,000 crore for roads development in Bengal

• Rs 95,000 crore to be spend on roads in West Bengal. The announcement for the state of Bengal got the loudest thumping of desks.

Central funding for Kochi Metro

• Central fiscal funding for Kochi Metro, Chennai Metro, Bengaluru Metro, Nagpur Metro and Nashik Metro projects.

Voluntary scrapping policy for vehicles

• FM Sitharaman announces voluntary scrapping policy. Fitness test after 20 years for personal vehicles; after 15 years for commercial vehicles.

Transport System Operator (TSO)

• FM announces transport system operator (TSO) for regulating common carrier capacity in gas pipelines to boost gas-based economy.

Scheme for promoting flagging of merchant ships

• Scheme for promoting flagging of merchant ships in India will be launched by providing subsidy support.

FINANCE

Bad Bank

• After dilberating on this for years, Finance Minister finally announces a Bad Bank. A new asset reconstruction and asset management company announced.

Further infusion of Rs 20,000 crore for public sector banks

• FM announces further infusion of Rs 20,000 crore for public sector banks

Govt will facilitate a world-class fintech hub at Gift city

• Government to support the development of a world-class fintech hub at GIFT, investor charter to be introduced.

FDI Hike In Insurance

• The finance minister announced to hike the FDI limit in Insurance from 49% to 74%. Majority directors on board and Key management personnels will be Indians.

Disinvestment target for FY2022 at Rs 1.75 lakh cr

• FM puts disinvestment receipts at Rs 1.75 lakh cr for fiscal year beginning April 1, 2021.
• Strategic disinvestment of companies including BPCL, Air India, Pawan Hans, IDBI Bank, Container Corporation of India to be completed in 2021-22
• Two PSBs and one general insurance company to be divested, legislations amendments to be introduced in this session.

Government to bring LIC IPO this year

• The government plans to sell part of its holding in Life Insurance Corporation of India through an initial public offering in the coming year. An amendment to the existing Act to facilitate the public offer.

POWER, ENERGY

Budget 2021 Power push

• The government is proposing to create a framework to give consumers alternatives to choose from more than one power distribution company.

Rs 3.05 lakh crore outlay for power sector

• Rs 3.05 lakh crore outlay. 100 more cities to be added in the next 3 years to the gas distribution network.

Ujjawala push

• The government has announced the extension of benefits of the Free cooking gas LPG scheme Ujjwala scheme to an additional 1 crore people .

FM gives boost to renewable energy sector

• Rs 1,000 crore to solar energy corporation and Rs 1,500 to renewable energy development agency.

Gas pipeline project to be taken up in J&K

• Finance Minister Nirmala Sitharaman announces a new gas pipeline project for Jammu and Kashmir.

Hydrogen energy mission

• Hydrogen energy mission for generating hydrogen out of green-powered sources

Projects in PPP mode for ports

• Seven projects worth Rs 2,000 crore in PPP mode for ports in the country.

Gas Transportation

• The government has announced an independent gas transport system operator for booking and coordination to ensure for unbiased allocation of natural gas transportation capacity.

TAXATION

Customs duty on some auto parts to be raised to 15 per cent

• Talking about GST, FM Sitharaman said that the government is focused to further ease the process. "Customs duty on copper scrap cut to 2.5 per cent. Customs duty on some auto parts to be raised to 15 per cent."

Exemption from filing tax for elderly

• In the 75th year of Independence of our country, we shall reduce compliance burden on senior citizens. For senior citizens who only have pension and interest income, proposed exemption of filing of income tax returns.
• Proposes policies to make it easy for foreign investors to invest in India's infrastructure projects
• Propose to make dividend payments to REIT (estate investment trusts) and Invit's (Infrastructure investment trusts) exempt from TDS
• To further ease filing of IT returns, details of capital gains and interest from banks, post offices, etc will be pre-filled

Reassessment be opened for 10 years

• Reassessment be opened for 10 years only if evidence of concealment of income of Rs 50 lakh or more in a year.
• In serious tax evasion cases, only where there is evidence of concealment of income of Rs 50 lakh or more in a year, can reassessment be opened for 10 years. For others, assessmennt reopening only for 3 years.

NRIs to be spared from double taxation

• NRIs to be spared from double taxation. New rules to be notified. Tax audit limit increased from Rs 5 crore to Rs 10 crore.

NRIs allowed to operate One Person Companies or OPCs in India

Tax holiday for start-ups increased by one more year - till March 31, 2022

Late deposit of employee's contribution to PF by employers will not be allowed as deduction to employer

INDUSTRY

Definition Of Small Companies To Be Revised

• The definition of small companies to be revised by raising capital base to Rs 2 cr from current limit of Rs 50 lakh.

Government to increase maximum threshold paid-up capital of small companies

• Government to increase maximum threshold paid-up capital of small companies from Rs 50 lakh to Rs 2 crore and increase the threshold of maximum turnover from Rs 2 crore to Rs 20 crore.

Government removes threshold limits of paid-up share capital of Rs 50 lak

• Government removes threshold limits of paid-up share capital of Rs 50 lakh and average annual turnover of Rs 2 crore over the past three financial years.
• Government has also eased requirements of residency for a person setting up a One person company from 182 days to 128 days in India.

DIGITAL

Rs 1,500 crore for promoting digital mode of payment

• Finance Minister Nirmala Sitharaman earmarks Rs 1,500 crore for promoting digital mode of payment.

Manufacturing

The PLI Push

• The government aims to spend Rs 1.97 lakh crore on various PLI schemes over the next 5 years. This is addition to the Rs 40,951 crore announced for the PLI for electronic manufacturing schemes. It is likely to attract global players in the Indian manufacturing sector.

TEXTILE

The Govt's textile push

• In its continuing focus on AtmaNirbhar Bharat, Finance Minister Nirmala Sitharaman announced in her budget speech the establishment of seven textile parks across the country.

Others in Budget

• Setting up of conciliatory mechanism for quick resolution of contractual disputes
• Govt proposes to introduce National Nursing and Midwifery Commission Bill
• Govt proposes national language translation initiative
• Deep ocean mission with outlay of more than Rs 4,000 cr over five years.
• Forthcoming Census could be India's first digital Census, allocating Rs 3,768 crore
• Rs 300 crore to the state of Goa for celebrating the 60th anniversary of liberation
• FM announces development of 5 major fishing hubs
• Tax exemption for aircraft leasing cos
• Tax exemption for notified affordable housing for migrant workers
• Rs 1.5 lakh deduction on payment of interest for affordable housing extended by 1 yr
• Record GST collections in last few months; govt to take every possible measure to reduce anomalies
• Tax holiday for startups extended by 1 yr; exemption on capital gains on investment in startups extended by 1 yr