NEW DELHI, Feb 1: Indian Finance Minister Nirmala Sitharaman on Monday unveiled the budget for fiscal 2021-22, that aims to shore up an economy badly-hit by the novel coronavirus pandemic.
The economy is projected to contract 7.7% in the current fiscal year, although the government forecasts growth of 11% for the coming fiscal year, after a massive COVID-19 vaccination drive and a rebound in consumer demand and investments.
These are the highlights from Sitharaman’s fiscal 2021-22 budget speech:
DEFICIT
* 2020/21 fiscal deficit seen at 9.5% of GDP
* 2021/22 fiscal deficit seen at 6.8% of GDP
* 2025/26 fiscal deficit target set at 4.5% of GDP
EXPENDITURE
* 2020/21 revised expenditure 4.39 trillion rupees ($60.14 billion)
* 2021/22 capital expenditure estimated at 5.54 trillion rupees ($75.90 billion)
* Revised revenue expenditure to 34.5 trillion rupees ($472.70 billion) in 2020/21
* 2021/22 gross expenditure seen at 34.83 trillion rupees ($477.16 billion) in 2021/22
* To provide more than 2 trillion rupees ($27.40 billion)for states and autonomous bodies
RECEIPTS
* 2021/22 revenue receipts seen at 17.88 trillion rupees ($244.98 billion)
* 2020/21 revenue receipts revised to 15.55 trillion rupees ($213.06 billion) from 20.21 trillion rupees ($276.91 billion)projected earlier
* Aims to get 6.3 trillion rupees ($86.32 billion) from goods and services tax in 2021/22
* Revised 2020/21 goods and services tax collection to 5.15 trillion rupees ($70.56 billion) from 6.91 trillion rupees ($94.68 billion) projected earlier
* Aims to get 1.04 trillion rupees ($14.25 billion) from dividends and profit in 2021/22
* Aims to get 535.11 billion rupees ($7.33 billion) dividend from Reserve Bank of India and financial institutions in 2021/22
BORROWING
* To raise 2.5 trillion rupees ($34.25 billion) via cash management bills in 2021/22
* 2021/22 gross market borrowing seen at 12 trillion rupees ($164.40 billion)
Highlights: India unveils budget aimed at boosting pandemic-hit...
* India says will need 800 billion rupees ($10.96 billion) in next two months from bond market
HEALTHCARE
* India to allocate 2.2 trillion rupees ($30.20 billion) for healthcare in 2021/22
* Sitharaman says expect two or more COVID-19 vaccines soon
* India to launch new federal health scheme with outlay of around 641 billion rupees ($8.80 billion) over the next six years
* To allocate 350 billion rupees ($4.81 billion) for COVID-19 vaccines, and allocate more funds if needed.
FINANCE
* India to introduce bill for development financial institution with capital of 200 billion rupees ($2.74 billion)
* To infuse 200 billion rupees ($2.74 billion) for recapitalization of state-run banks in FY2022
* India to consolidate certain SEBI regulations for Securities Market Code
* To relax FDI cap for insurance sector to 74% from 49%
* Set up asset reconstruction company to take over toxic assets
* To cut money market requirement to 15% from 25%
* To allocate 15 billion rupees ($205.50 million) for scheme to incentivise use of digital payments
* India to incentivise incorporation of one-person companies
DUTY
* Basic customs duty of 1.4rs/litre on petrol, 1.8rs/liter on diesel
* Proposes agricultural cess of 2.5rs/litre on petrol, 4 rs/litre on diesel
* To withdraw a few exemptions on some mobile components
* Cuts customs duties to 7.5% on semis, some steel products
* Revokes customs duties on some steel products
* Rationalising customs duties on gold and silver
* Cuts tax on gold ore to 6.9% from 11.85%
* Raises import tax on solar inverters and lanterns
* Raising customs duties on some auto parts
* Raises customs duties on cotton to 10%
* To review more than 400 old exemptions for customs duty
* Proposes agricultural infrastructure and development cess
INCOME TAX
* Proposes exemption to senior citizens for filing income tax returns
* Proposes changes in personal income taxes for non-resident Indian
* To set up dispute resolution panel for small taxpayers
DIVESTMENT
* India sets 2021/22 divestment target at 1.75 trillion rupees ($23.97 billion)
* India to divest two public sector banks and one general insurance company
* India to launch IPO of Life Insurance Corporation
* India to announce policy for privatisation of state-run companies
* To create new list of companies for divestment
* India to introduce new mechanism for privatisation of loss-running state-run companies
* To monetise surplus lands of public sector entities
INFRASTRUCTURE
* To allocate 2.87 trillion rupees ($39.40 billion) for clean water supplies over the next five years
* To allocate 3 trillion rupees ($41.10 billion) for power sector for next five years
* To provide 10 billion rupees ($137.01 million)to Solar Energy Corporation of India
* Sitharaman says will move to end power distribution company monopolies
* To double ship recycling capacity by 2024
* India to monetise infrastructure assets
* To extend tax holiday on low cost housing projects for one more year
TRANSPORT
* Allocates 1.18 trillion rupees ($16.17 billion) for ministry of roads and highways
* Allocates 1.1 trillion rupees ($15.07 billion) for railways
* Railways to monetise freight corridors
* India to launch new vehicle scrapping policy
* Proposes tax holiday for aircraft leasing firms in India
AGRICULTURE
* India allocates an estimated 1.7 trillion rupees ($23.29 billion) for paddy procurement
* Hikes enhanced agriculture credit target to 16.5 trillion indian rupees ($226.05 billion) in 2020/21
* To include loans for activities in allied sectors in agriculture
* To discontinue small savings fund loans to Food Corporation of India
LABOUR
* To launch database for gig economy, building and construction workers
* Social security benefits to be extended to gig economy workers
($1 = 72.9940 Indian rupees)
