A to Z: Union Budget 2020 in alphabet

A to Z: Union Budget 2020 in alphabet

Finance Minister Nirmala Sitharaman presented her second Union Budget in the Parliament today (Feb. 1, 2020). The Budget, which tried to put money in people’s pockets to spur spending, has several hits and misses. Here's a look at the A to Z of the Union Budget 2020:

Agriculture: To boost the agriculture sector, the government proposed an 11 per cent increase in the farm credit target to Rs 15 lakh crore for 2020-21 and announced special rail and flight services for the transportation of farm produce as it seeks to double farmers' incomes by 2022. To liberalise the agri-market, Sitharaman urged the state governments to undertake the implementation of three central model laws -- the Model Agricultural Land Leasing Act, 2016; the Model Agricultural Produce and Livestock Marketing (Promotion and Facilitation) Act, 2017; and the Model Agricultural Produce and Livestock Contract Farming and Services (Promotion and Facilitation) Act, 2018.

Artificial Intelligence: With a focus on new economic models based on new-age technologies like Artificial Intelligence and the Internet of Things, the government intends to bring out a policy to enable the private sector to build data center parks throughout the country.

Aspirational India: The government described one of the hands holding the bouquet of the economy as Aspirational India. As part of this, all sections of society seek better standards of living, with access to health, education and better jobs.

Archaeological sites: The Budget proposed the setting up five archaeological sites as iconic sites with on-site museums. They are Rakhigarhi (Haryana), Hastinapur (Uttar Pradesh) Shivsagar (Assam), Dholavira (Gujarat) and Adichanallur (Tamil Nadu).

Beti Bachao Beti Padhao: The government asserted that it will keep its focus on the welfare of women and children. Sitharaman said that the 'Beti Bachao Beti Padhao' scheme had yielded "tremendous" results with the gross enrolment ratio of girls across all levels of education now at a higher level than boys.

Banking: For the next financial year, beginning April 1, the government expects a substantial Rs 90,000 crore revenue from disinvestment of government stake in public sector banks and financial institutions. This would help the government achieve the Rs 1.20 lakh crore total disinvestment proceeds for 2020-21. The government proposed to sell the balance holding of the Government of India in IDBI Bank to private, retail and institutional investors through the stock exchange.

Backward Class: The Budget provides a provision of Rs 85,000 crore for the Scheduled Castes and Other Backward Classes and Rs 53,700 crore for Scheduled Tribes.

Crop: The government has proposed promoting the 'one product one district' for better marketing and export of horticulture crops. It also called on states for early implementation of three key central model laws on land leasing, agriculture produce and livestock marketing, and contract farming.

Commerce: Commerce and trade-related terms indicate how India has tackled metallurgy, trade, etc. for a millennium. The government proposed to provide Rs 27,300 crore for development and promotion of Industry and Commerce for the year 2020-21.

Direct Tax:  The Finance Minister said that with the objective of enhancing the efficiency of the delivery system of the Income Tax Department, the provisions of the Income Tax Act would be amended to mandate the Central Board of Direct Taxes to adopt a Taxpayers’ Charter.

Disinvestment: Sitharaman said that insurance behemoth LIC will be listed as part of the government disinvestment initiative. She said that the listing would bring in more financial discipline among the entities.

Employment: Sitharaman said that growth of tourism directly relates to growth and employment and mentioned that she expected state governments to develop a roadmap for certain identified destinations and formulate financial plans during 2021 against which specified grants would be made available to the states in 2020-21.

Education: The Finance Minster said that a new education policy will be announced soon, taking into account over two lakh suggestions received.

Fisheries: Sitharaman pointed out that the youth in coastal areas benefit through fish processing and marketing. Therefore, she proposed to raise the fish production to 200 lakh tonnes by 2022-23.

Fiscal deficit: Under the Section 4(2) of the FRBM Act, the Finance Minister has taken a deviation of 0.5% from the estimated fiscal deficit, both for RE 2019-20 and BE 2020-21.

GST filing goes simple(r): FM Sitharaman announced that the GST filing will be made simpler from April 1, and though she refrained from explaining exactly what that would entail, she did say that the average household was saving 4 per cent in monthly expenses since the GST came in.

GDP growth target: Nominal GDP growth was pegged at 10% for FY21, while the Economic Survey had projected GDP to grow at 6-6.5%

Heritage: Sitharaman proposed an Indian Institute of Heritage and Conservation, saying that the Ministry of Culture was allocated Rs 3,150 crore and that five archaeological sites in Haryana, Uttar Pradesh, Assam, Gujarat and Tamil Nadu would be developed with museums.

Income tax relief: The common taxpayer got a massive relief in a reduction of income tax nearly across the board and the option to opt into the new, reduced income tax regime or to stay in the existing regime. Income Tax was reduced by as much as half, with only annual incomes over Rs 15 lakh being taxed at the existing 30%.

Infrastructure: The Centre launched infrastructure projects worth over Rs 103 lakh crore across logistics, housing, clean energy, healthcare and others.

Jal Jeevan Mission: The government alloted Rs 11,500 crore for the Jal Jeevan Mission for the year 2020-21. It will provide piped water supply to all households.

Krishi Rail: With the target of doubling farmer income by 2022, the government announced 'Kisan Rail' for the transport of perishable goods to assist agriculture movement within India.

LIC IPO: With the divestment target of Rs 2.1 lakh crore for FY21, the government has announced the sale of a part of its holdings in Life Insurance Corporation through an Initial Public Offering (IPO) later this year.

NABARD: The Finance Minister announced the expansion of the refinancing scheme of NABARD. The scheme gives the provision to supplement the resources of banks and to improve credit flow at the ground level. It also provides adequate credit for supporting investment activities of farmers and rural artisans. The government has set Rs 15 lakh crore for the agricultural credit target for the year 2020-21.

NBFC: The government has formulated a Partial Credit Guarantee scheme for the NBFCs to address the liquidity constraints of the NBFCs/HFCs, post Union Budget 2019-20.

MSME: The government has announced various measures to support MSMEs. The government has proposed to make necessary amendments in the Factor Regulation Act 2011. To deal with the issue of capital credit, the government has announced the Credit Guarantee Trust for Medium and Small Entrepreneurs. The government will launch an app-based financing loans product to resolve the problem of delayed payments and consequential cash flows mismatches. Debt funding of Rs 900 crore to be made available from banks. 

Oil and gas: For up-streaming of the oil and gas sector, the Open Acreage Licensing Policy is awarded 1,37,000 sq km for exploration to private sector and to the CPSEs. The government has also proposed to expand the national gas grid from the 16,200 km to 27,000 km and gas markets in India. 

Public Sector Banks: The government has infused Rs 3.5 crore into public sector banks under Union Budget 2020. The move has been taken considering the sector's financial requirements and growth plans. It is a huge jump as the last year's allocation was Rs 70,000 crore.

Qualified Foreign Investors: Sitharaman announced the extension of the period up to June 30, 2023, for lower rate of withholding of 5 per cent under section 194LD for interest payment to Foreign Portfolio Investors and Qualified Foreign Investors in respect of bonds issued by Indian companies and government securities.

Railways: The government announced that there is a proposal to set up a big solar power capacity alongside rail tracks. Also, in a bid to boost tourism, more Tejas-like trains will run across tourist destinations.

Swachch Bharat Mission: Among a host of schemes. there were allocations for the Swachch Bharat Mission as well, Prime Minister Narendra Modi government's flagship project for a cleaner India. The total allocation for the Swachh Bharat Mission is about Rs 12,300 crore in 2020-21.

Textiles: Among a host of schemes, there were allocations for the textile industry. To quote Sitharaman, "India imports a significant quantity of technical textiles worth US$ 16 billion every year. To reverse this trend and to position India as a global 14 leader in Technical Textiles, a National Technical Textiles Mission is proposed with a four-year implementation period from 2020-21 to 2023-24 at an estimated outlay of Rs 1,480 crore."

Udaan scheme: The FM announced that air traffic is growing rapidly in the country and so, 100 more airports would be developed by 2024 to support the Udaan scheme. She also said that the air fleet number shall go up from the present 600 to 1,200 (from 2020 to 2024).

Vivaad se Vishwas: The scheme deals with tax litigations, where one had to pay the tax dues minus interest and penalties. A taxpayer would be required to pay only the amount of the disputed taxes and will get complete waiver of interest and penalty provided he pays by March 31, 2020. Those who avail this scheme after March 31, 2020, will have to pay some additional amount. The scheme will remain open till June 30, 2020. 

Wealth: During the Budget speech, Sitharaman said that wealth creators in the country will be respected. Wealth creators was the theme of the Economic Survey 2020 that was released

X-factor: Tax gain or tax pain? The answer to this may be the X-factor.

Yojanas: The Deen Dayal Antyodaya Yojana, the poverty alleviation scheme through which 58 lakh SHGs have been mobilised so far, to be extended further. The Finance Minister also announced Rs 6,400 crores for the Prime Minister Jan Arogya Yojana.

Zooming in on highways: Sitharaman announced the construction of 2,500-km access control highways, 9,000-km economic corridors, 2,000-km coastal and land port roads and 2,000-km strategic highways. The Delhi-Mumbai Expressway and two other packages would be completed by 2023. The Chennai-Bengaluru Expressway would also be started. The monetisation of at least 12 lots of highway bundles of over 6,000 Km before 2024 through FASTag mechanism was announced.