Finance Minister Nirmala Sitharaman introduces the Union Budget 2020 at Lok Sabha. The 2020 budget focuses on three main themes – Aspirational India; Economic Development for all & a Caring Society. Under these three motifs, the budget allocates resources and proposes new strategies for each industry. Get the detailed analysis and highlights of the Union Budget 2020 here, and know the Finance Ministry’s important policy decisions, along with new schemes and tax slab adjustments. Take a Glance at what the budget holds for 2020 in terms of Central and State Governments allocated funds, projected expenditure to be incurred in 2020–21 and profit to also be raised through such investment.
The year 2019 has been a bit of a challenge both internationally and nationally in terms of economic growth and development. A steep decline in GDP growth rate was observed in India during the quarter of July – September 2019; GDP was at its lowest 4.5 per cent. In this fiscal year, the Union Budget 2020 focuses on reviving the Indian economy through adjustments throughout income tax slabs, tax reforms, policy changes for the real estate sector, the revival of the automotive sector, promoting privatization in CPSEs, enhancing MSMEs, banking reforms and so much more.
Giving you some highlights and complete analysis of the Budget 2020 as follows:
- The budget aims to double farmers’ incomes by 2022 by: implementing national laws such as the Contract Farming Act, 2018, APMC, 2017 and the Model Agriculture Land Leasing Act, 2016; implementing comprehensive measures for 100 water – stressed districts; providing stand – alone solar pumps to around 20 lakh farmers; More than 15 barren land lakh farmers will be allowed to solarize their farms and use fertilizers in a balanced manner to transform the current incentive system.
- “Aathichudi by Auvaiyar. Bhoomi Thiruthi Unn”; which means first take care of your property.
- Self – help groups run village storage scheme: Women self – help groups can now get help from NABARD or Mudra.
- The horticulture industry has exceeded food grain production by nearly 311 million metric tonnes. The government will assist all states fighting for ‘one product, one district’.
- Integrated farming systems to be built in rain – fed areas.
- Negotiable Warehousing Receipts Financing has crossed Rs. 6,000 crore.
- Budget fixes the target of Agricultural Credit at Rs. 15 Lakh Crore.
- The Kisan Credit Card (KCC) scheme will now cover all beneficiaries of PM Kisan scheme.
- MNREGA will be merged for creating fodder farms.
- To raise fish production to 200 lakh tones by 2022 – 23.
- Indian Railways to set up “Kisan Rail” to enable the rapid transportation of farm goods. It will also be used with PPP layout for cold storage of goods.
- Civil Aviation Ministry will operate Krishi UDAN on foreign as well as national routes.
Wellness, Water & Sanitation
- Budget sanctions Rs. 12,300 crore for Swachch Bharat Mission.
- Budget talks in the context of India’s fight against the NCDs-non-communicable diseases on the “Fit India movement”.
- Budget seeks to establish hospitals in Tier-II and Tier-III Indian cities under the PPP model.
- Jan Aushadhi Kendra’s enhancement
- Budget allocates 69,000 Rs of crop to health
- The Union Budget 2020 recommends foreign direct investment in education, FDI and External Commercial Borrowing (ECB).
- In 2020 – 21, 150 higher education institutions must commence apprenticeships.
- Urban local bodies were asked to offer fresher’s and engineers internship opportunities for a period of one year.
- An online education system at the graduate level will be launched to provide quality education to the disadvantaged sections of students.
- INDSAT exams will be carried out in Asian and African countries under the program Study in India.
- Budget proposes establishing “National Police University” and “National Forensic Science University”.
- Budget recommends to attach a Medical College under the PPP model to all existing district hospitals.
- The budget allocates Rs 99,300 to the education sector and Rs 3000 to the development of skills.
- Union Budget 2020 proposes the development of an “Investment Clearance Cell” to provide services such as free investment advice, land banks and others. An online portal to this effect will be launched.
- A new scheme recommended in electronics manufacturing to spur investments.
- National Technical Textiles Mission proposed.
- All ministries will issue quality standards.
- Announced a new scheme called “NIRVIK” for less duties and taxes on manufactured goods. The scheme will be launched in 2020 – 21.
- Budget proposes making every district an export hub.
- The budget allocates Rs. 27,300 to industry and trade development in 2020 – 21.
- National infrastructure pipeline to offer job opportunities.
- Government to form a National Logistics Policy soon.
- It proposes to build the Chennai – Bengaluru Expressway.
- Electrification of approximately 27,000 km of railroad lines within 100 days of the establishment of Modi Government in 2019.
- The Indian Railways had proposed a large solar power capacity. It will be built on railroad lands owned by the Railways.
- Project proposed by Bengaluru Suburban Rail; budget assigns Rs 18,600 crore for this project.
- By 2024, the government would monetize 12 lots of national highways.
- With the help of UDAN program, 100 airports will be built by 2024.
- In 2024, the Aircraft fleet will be expanded to 1200 aircraft.
- Rs 1.7 lakh crore assigned for transport infrastructure.
- Prepaid intelligent meters: States will have to replace existing energy meters with prepaid intelligent meters.
- Budget reserves Rs. 22,000 crore for the Power and Renewable Energy Sector.
- The national gas grid will be expanded from 16,200 km to 27,000 km.
- A policy change for building private sector data center parks will be introduced.
- Bharat Net connects 1 lakh gram panchayats to home connections through fiber.
- Budget allows Rs. 6,000 crore for the Bharat Net program.
- In the next 5 years, it provides Rs. 8,000 crore for “National Quantum Technology and Applications Mission”.
- ‘Beti Bachao, Beti Padhao’ women’ registration in schools is higher than boys’.
- 35,600 crore for nutrition related programs will be given.
- Task Force will be set up to examine the issue of low – aged girls pursuing maternity.
- It assigns Rs. 85,000 of crop to SC and OBC advancement.
- It assigns Rs. 53,700 for development of STs.
- It assigns Rs. 9,000 of crore to senior citizens and disabled people.
Art & Culture
- The Government will create the “Indian Institute of Heritage and Conservation” as a university considered.
- 5 archeological sites to be developed as top – notch sites;
- Rakhigarhi, Haryana.
- Hastinapur, Uttar Pradesh.
- Sivasagar, Assam.
- Dholavira, Gujarat.
- Adichanallur, Tamil Nadu.
- The government will build a Tribal Museum in Ranchi.
- The budget allows Rs. 3150 crore for the Ministry of Culture.
- The Tourism Sector will increase by 7.8% by Rs. 1.88 lakh crore.
- From January 2021, the Disaster Resilient Infrastructure Coalition will be implemented.
- This provides Rs. 4,400 crore to facilitate clean air in towns with a population of more than 1 million.
- A public shield will be established in the Statutes to prevent the event of citizen harassment.
- For placement in non – bank posts, the National Recruitment Agency will be formed for public and government banks.
- It recommends creating a New National Official Statistics Strategy.
- Deposit insurance cover was significantly expanded from Rs 1 lakh to Rs 5 lakh.
- Disinvestment in Banks: Government’s share in IDBI Bank will be sold to the private sector.
MSME & Corporate Sector
- The budget recommends a new MSME scheme in the sense of under debt.
- MSME’s debt recovery window is extended by one year until 31 March, 2021.
- It will now open up certain categories of government securities for non – resident investors.
- The corporate bond FPI limit increased to 15%.
Strategic Disinvestment & Privatization
- Finance Minister Nirmala Sitharaman, suggests selling the Government’s interest in India’s Life Insurance Corporation (LIC). The LIC IPO is to be introduced for that reason.
Income Tax Reforms
Budget 2020 transforms the Income Tax regime by introducing new tax slabs and rates:
- Income Slabs upto Rs. 5 lakh.
- From 5 lakh to 7.5 lakh,
- From 7.5 lakh to 10 lakh,
- From 10 lakh to 12.5 lakh,
- From 12.5 lakh to 15 lakh and above.