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Highlights of Union Budget 2020-21 presented by FM Nirmala Sitharaman

image source indiabudget.gov.in


Finance Minister Nirmala Sitharaman while presenting the Union Budget               2020- 2021, declared that this Budget proposal rest on six pillars.

  1.  Health and well-being 
  2.  Physical and financial capital and infrastructure 
  3. Inclusive development for Aspirational India 
  4. Reinvigorating human capital
  5. Innovation and R&D
  6. Minimum Government, Maximum Governance. 

Budget proposes for increase in Customs Duty to benefit Make in India scheme of the GoI. It also includes the proposal to for dis-investing two more Public Sector Banks and a general insurance company.

Budget also includes proposals for numerous infrastructure project pledges to poll-bound States (i.e Tamil Nadu, West Bengal, Assam & Kerala). Sitharaman announced maximum 1.03 Lakh crore for Tamil Nadu, where this money would be used in the next five years for infrastructure. Kerala has been earmarked ₹ 65,000 crore and Assam has received ₹ 34,000 crore.


Health and Sanitation: 

  • A new scheme, titled PM Atma Nirbhar Swasthya Bharat Yojana (ANSBY), to be launched to develop primary, secondary and tertiary healthcare. 
  • Mission POSHAN 2.0 to improve nutritional outcomes across 112 aspirational districts 
  • Operationalisation of 17 new public health units at points of entry 
  • Modernising of existing health units at 32 airports, 15 seaports and land ports 
  • Jal Jeevan Mission Urban aimed at better water supply nationwide 
  • Strengthening of Urban Swachh Bharat Mission 


Education: 

  • 100 new Army Schools will be established. 
  • New 750 Eklavya schools will be set up in tribal areas so increase the reach of education to tribal areas.
  • Government will established a Central University in Ladakh. 


Infrastructure 

  • Vehicle scrapping policy will be launched to phase out old and unfit vehicles from the road.
  • All old vehicles will undergo fitness test in automated fitness centers every 20 years (personal vehicles), every 15 years (commercial vehicles). 
  • National Asset Monetizing Pipeline launched to monitor asset monetization process. 
  • National Rail Plan created to bring a future ready Railway system by 2030. 
  • 100% electrification of Railways to be completed by 2023. 
  • Metro services announced for 27 cities and additional allocations for Kochi Metro, Chennai Metro Phase 2, Bengaluru Metro Phase 2(A and B), Nashik and Nagpur Metros. 
  • National Hydrogen Mission will be launched to generate Hydrogen from green power sources. 
  • Recycling capacity of ports to be doubled by 2024. 
  • A new Gas pipeline project to be set up in Jammu and Kashmir 
  • Pradhan Mantri Ujjwala Yojana (LPG scheme) to be extended to cover 1 crore more beneficiaries.  


Taxation 

  • Senior citizens aged 75 years and above with only one pension and interest scheme are exempted from filing income tax returns.
  • No IT assessment cases will be opened for older then 3 years. However, in case of serious tax evasion cases (Rs. 50 lakh or more), it can go up to 10 years 
  • For affordable housing projects the period for claiming an additional deduction for the interest of ₹ 1.5 lakh paid for home loans by one year to March 31, 2022.
  • Custom duty on gold and silver to be reduced, as a result the Prices of Gold and Silver will reduce.
  • Solar Panlels and LED Bulbs will be costlier due to increase in duty.
  • Tunnel boring machines to attract customs duty of 7% 
  • Customs duty on cotton raised from 0 to 10%. As a result Cotton cloths will be costlier now. 
  • Agriculture infrastructure and development cess proposed on certain items including urea, apples, crude soyabean and sunflower oil, crude palm oil, kabuli chana and peas will increase their prices.


Economy and Finance

  • Fiscal deficit stands at 9.5% of the GDP and is estimated to be 6.8% in 2021-22. 
  • States could borrow up to 4% of GSDP this year. 

  • Proposal to increase FDI limit from 49% to 74% in the Insurance sector.
  • An asset reconstruction company will be set up to take over stressed loans. 
  • Deposit insurance increased from Rs 1 lakh to Rs 5 lakh for bank depositors. Now if any Bank gets Bankrupt then one can claim up to 05 Lakh as compensation or the actual amount(whichever is less). 
  • Two Public Sector Banks and one general insurance firm will be disinvested this year. 
  • An IPO for LIC will be launched.
  • Strategic sale of BPCL, IDBI Bank, Air India to be completed. 


Agriculture: 

  • Agriculture infrastructure fund  to be made available for APMCs for augmenting their infrastructure. 
  • 1,000 more Mandis to be integrated into the E-NAM market place. 
  • Five major fishing hubs, including Chennai, Kochi and Paradip, to be developed. 
  • A multipurpose seaweed park to be established in Tamil Nadu. 


Employment:

  • A portal to be launched to maintain information on gig workers and construction workers 
  • Social security to be extended to gig and platform workers 
  • Margin capital required for loans via Stand-up India scheme reduced from 25% to 15% for SCs, STs and women

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