From expansion of national highways, affordable housing to construction of 400 new generation Vande Bharat trains and other such measures, the government aims to boost employment generation and boost economic activity.
The total government expenditure will be 4.6 per cent higher than the current year and an additional assistance of Rs 1 lakh crore has been announced to the states.
Full Coverage: Union Budget 2022-23
What will be the impact of the budget on consumers
Here is a snapshot of the budget documents:
‘Fastest pace of economic growth’
* The government has projected India’s economy to grow by 9.2 percent in the current financial year. The Finance Minister said that India is expected to grow at the fastest pace among all the major economies.
* According to budget documents, the economy is on track to recover 101.3 per cent of 2019-20 pre-pandemic output.
* India’s Gross Domestic Product (GDP) has already crossed $3 trillion in dollar terms, CEA Nageswaran said during the PSOT-Budget press conference.
Fiscal deficit slightly higher at 6.9%
* Fiscal deficit is estimated to be 6.9 percent in this financial year, which was earlier estimated at 6.8 percent
* The government’s fiscal deficit for 2022-23 is estimated at Rs 16,61,196 crore.
* Revised estimates for 2021-22 indicate a fiscal deficit of Rs 15,91,089 crore, as against the budget estimate of Rs 15,06,812 crore.
* Total expenditure is estimated at Rs 39.45 lakh crore in 2022-23, while total receipts other than borrowings are estimated at Rs 22.84 lakh crore.
* Finance Minister said that the outlay for capital expenditure Union Budget Once again there has been a rapid growth of 35.4 per cent from Rs 5.54 lakh crore in the current year to Rs 7.50 lakh crore in 2022-23.
Inflation remains under pressure
* Rising level of inflation remains a matter of concern for the economy. Retail inflation in India hit a five-month high of 5.59 per cent in December, driven by a hike in cooking gas prices.
strong forex accumulation
* Foreign exchange reserves stood at $634.287 billion as on January 21, providing a cover equivalent to 13 months of imports estimated for 2021-22.
PM dynamics
* PM Gatishakti National Master Plan will include seven engines for economic transformation, seamless multimodal connectivity and logistics efficiency.
* The seven locomotives include roads, railways, airports, ports, mass transport, waterways and logistics infrastructure. All seven engines together will further fuel economy.
* Sitharaman said that 400 new Vande Bharat trains will be started and Railways will also develop new products for small farmers and MSMEs.
* Integration of postal and railway networks facilitating parcel movement announced.
* The Finance Minister said that 100 PM Gatishakti Cargo Terminals will be developed for multi-modal logistics facilities during the next three years.
* Master plan for highways has been prepared, target is to complete 25,000 km of National Highways in 2022-23.
Agriculture and Food Processing
* The budget allocation of the Ministry of Agriculture and Farmers Welfare has been increased by 4.5 per cent to Rs 1,32,513 crore for the financial year 2022-23.
* Sitharaman said the government will promote the use of ‘kisan drones’ for crop evaluation, digitization of land records and spraying pesticides.
* To finance startups and rural enterprises operating in the agriculture sector, the minister said the government would facilitate a fund through NABARD with mixed capital raised under co-investment model.
Education
* A digital university will be set up to provide students across the country access to world class quality universal education.
* It will be a personalized learning experience at their doorstep and will be made available in various Indian languages and ICT formats.
* One Class One TV Channel program will be expanded to 200 TV channels.
* Virtual labs and skilling e-labs will be set up to foster critical thinking skills and a motivated learning environment.
* Sitharaman also announced that Desh-Stack e-portal – Digital Ecosystem for Skilling and Livelihood will be launched.
Health care
*Rs 86,200.65 crore has been allocated to the health sector in the Union Budget, an increase of 16 per cent from Rs 73,931 crore in 2021-22.
* It also announced a national tele mental health program to improve access to quality mental health counseling and care services.
* An open platform for a national digital health ecosystem will also be launched.
* For the National Health Mission, the budget allocation increased from Rs 36,576 crore in 2021-22 to Rs 37,000 crore in 2022-23.
tax proposal
* Government’s GST collection in January 2022 was Rs 1,4 lakh crore, the highest ever
* One-time window has been allowed to taxpayers to rectify omissions in Income Tax Return (ITR). They can file updated return within 2 years from the assessment year.
* No change has been announced in personal income tax slab or standard deduction limit.
The budget proposes a 30 percent tax on income from transfer of virtual digital assets.
* One per cent tax deduction at source (TDS) on transfer of virtual assets above a threshold, gift will be taxed, the minister said.
* The government will soon introduce a digital rupee based on blockchain technology, the finance minister said.
*Tax Relief for Persons with Disabilities
* Extension of period for inclusion of eligible startups for providing incentives
* Concessional corporate tax rate of 15 per cent will be available for one more year till March 2024 for newly incorporated manufacturing companies.
* The government has proposed to increase the tax deduction on contribution by the state government to NPS to the employees from 10% to 14 percent.
PLI Scheme
* Sitharaman said the Centre’s Production Linked Incentive (PLI) scheme has the potential to create 60 lakh new jobs during the next five years.
* She said that spectrum auctions will be conducted in 2022 to facilitate the launch of 5G mobile services by private telecom providers within 2022-23 and a design-based manufacturing plan will be launched to create a strong ecosystem for 5G . Part of PLI Scheme
* To facilitate domestic manufacturing, an additional allocation of Rs 19,500 crore will be made for PLI Scheme for Manufacturing of High Efficiency (Solar) Modules with priority to fully integrated manufacturing units for Solar PV Modules from Polysilicon.
real estate
* Rs 48,000 crore allocated in the budget under Pradhan Mantri Awas Yojana (PMAY)
*Faster approvals for affordable housing in urban areas
Boost for MSMEs
* Sitharaman said that a program to enhance and accelerate MSME performance (RAMP) will be launched for MSMEs with an outlay of Rs 6,000 crore spread over 5 years.
* The Emergency Credit Line Guarantee Scheme (ECLGS), which provided much-needed additional credit to over 1.3 crore MSMEs, will be extended till March 2023, increasing its guarantee cover from Rs 50,000 crore to Rs 5 lakh crore.
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