Finance minister Arun Jaitley, who unveiled his last full Budget on Thursday, said India is poised to become $5 trillion economy soon from its current size of $2.5 trillion. The seventh fastest growing economy, India is all set to be the 5th fastest, soon, promised Jaitley.
Agriculture and health dominated Jaitley’s two-hour Budget speech. Employment and education were also focus areas. MSMEs found special mention in the Budget, with measures ranging from tax sops to easier access to loan.
Here are the highlights of Arun Jaitley’s speech:
* The Centre announced the world’s largest government-funded health care programme, aimed at benefiting 10 crore poor families by providing coverage of up to Rs 5 lakh per family per year for secondary and tertiary care hospitalisation. The National Health Protection Scheme will cover approximately 50 crore people.
* Government has allocated Rs 1,200 crore towards the National Health Policy 2017, which will go towards 1.5 lakh health and wellness centres. These centres will provide comprehensive health care — including for non-communicable diseases and maternal and child health services — as well as free essential drugs and diagnostic services.
* At least 24 new government medical colleges and hospitals will be set up by upgrading existing district hospitals. “This will ensure that there is at least one medical college for every three parliamentary constituencies and at least one government medical college in each state of the country,” said Jaitley.
* Government has allocated additional Rs 600 crore to provide nutritional support to all TB patients at the rate of Rs 500 per month for the duration of their treatment.
* Personal Income Tax: No change
* Relief to salaried tax: Standard deduction increased for transport and medical reimbursement to Rs 40,000 from Rs 15,000
* Rs 50,000 additional benefit to senior citizens for investment in mediclaim.
* Corporate tax for companies with an annual turnover of up to Rs 250 crore has been cut to 25%, which is expected to benefit the micro, small and medium enterprises (MSMEs) but will disappoint big corporates.
* Propose to tax long term capital gains exceeding Rs 1 lakh in listed stock at 10%.
* 100% tax exemption for the first five years to companies registered as farmer producer companies with a turnover of Rs. 100 crore and above.
* Demonetisation was received by honest taxpayers as ‘Imaandaari ka utsav’.
Government revised upwards its fiscal deficit target for 2017-18 to 3.5% of the GDP — or the equivalent of Rs 5.9 lakh crore — from 3.2%, an admission of fiscal slippage with implications for pushing inflation.
*In a bid to boost women’s participation in formal sector jobs, Jaitley announced that only 8% EPF will be charged from women. “Facility of fixed term employment to be extended. Twelve percent government contribution to EPF for new employees. Women’s contribution to EPF to be reduced to eight percent for first three years,” he said.
*Jaitley said the focus of the government in the coming fiscal will be agriculture and rural India, and announced that all kharif crop would be paid a minimum support price (MSP) that is 50 per cent more than the cost of production.
* He also announced that credit to agriculture will be raised to Rs 11 lakh crore in the coming fiscal from Rs 10 lakh crore.
* Agri-Market Development Fund with a corpus of Rs 2,000 crore to be set up for developing agricultural markets.
* Grameen Agricultural Market (GRAM) will provide farmers a means to sell directly to buyers.
* The focus is on low-cost farming, higher MSP. Emphasis is on generating farm and non-farm employment for farmers.
* The government will ensure payment of full MSP even if farmers sell below MSP.
* 4 government medical colleges and hospitals to be set up by upgrading existing district hospitals.
* 1,000 best BTech students to be made PM research fellows — to do PhDs in IITs and IISc. They will spend few hours every week teaching in technical institutions.
* Government has also taken steps to set up a specialised railway university in Vadodara and two new full-fledged schools of planning and architecture.
* Additionally, 18 School of Planning and Architecture will be set up in IITs and NITs as autonomous schools.
* Government to launch ‘Revitalising Infrastructure and Systems in Education by 2022: FM Jaitley
* Integrated B.Ed programme to be initiated for teachers, to improve quality of teachers.
* Budget 2018 will work with states to provide more resources to improve quality of education, says Jaitley.
* Jaitley announced an allocation of Rs 5.97 lakh crore for 2018-19 for infra spending, up by over Rs 1 lakh crore from the ongoing fiscal. “Infrastructure is the growth driver of the economy. Our country needs massive investment in excess of Rs 50 lakh crore in infrastructure to increase growth of GDP and integrate the nation with a network of roads, airports, railways, inland water and to provide good quality services to the people,” the finance minister said.
* Government will spend Rs 14.34 trillion ($220 billion) on rural infrastructure, including building new roads and toilets and bringing electricity to millions of rural households.
* NHAI would transfer the road projects into special purpose vehicles to use innovative structures such as infrastructure trusts for fund mobilisation.
* Government is committed to taking additional measures to further strengthen venture capital funds and angel investor ecosystem in the country. Jaitley said VC funds and angel investors need an innovative and special development, and a regulatory regime for growth.
“We have taken a number of policy decisions, including launching of Startup India programme, building a very robust alternative investment regime in the country and rolling out a taxation regime designed for the special nature of VC funds and angel investors,” said Jaitley.
* Imported electronics, including phones and TVs, will now get more expensive as government proposes to increase custom duty on mobiles from 15% to 20% and on some other mobile parts to 15%, and some parts of TVs to 15%.
* Finance minister Arun Jaitley has proposed to replace existing 3% education cess on personal income tax and corporation tax with a 4% ‘Health and Education Cess’ to take care of the education and health needs of the poor and rural families. “This will enable us to collect an estimated additional amount of Rs 11,000 crore,” said Jaitley.
* An outlay of Rs 2.95 lakh crore was set aside for the defence budget for the next fiscal, an increase of 7.81% over last year’s Rs 2.74 lakh crore.
* Of the total allocation, the capital outlay for the three defence services for purchase of new weapons, aircraft, warships and other military hardware has been pegged at Rs 99,947 crore.
* Government proposes to set up 5 lakh wifi-hotspots that will provide internet to five crore rural citizens in 2018-19.
* Government provided Rs10,000 crore for creation and augmentation of telecom infrastructure in 2018-19.
* Department of Telecom will support the setting up of indigenous 5G centre at IIT Madras.
* Government doesn’t consider cryptocurrencies as legal tender or coins. Will take all measures to prevent use of crypto-assets to finance illegitimate activities.
* Government has allocated capital expenditure of Rs 1,48,528 crore for the Indian Railways for 2018-19.
* All trains to be progressively provided with WiFi, CCTV and other state-of-the-art amenities.
* All railways stations with more than 25,000 footfall to have escalators.
* 12,000 wagons, 5160 coaches and 700 locomotives being procured.
* Focus will be on safety, maintenance of railway tracks, increase in use of technology and fog safety devices: FM Jaitley
* Redevelopment of 600 major railway stations has been taken up.
* Rs 17,000 crore is being set aside for the Bengaluru Metro and Rs 11,000 crore is being allocated for the Mumbai suburban railways.
*An institute is coming up in Vadodara to train the manpower required for the high speed railway projects.
* 36,000-km of rail track renewal targeted in coming year: FM Arun Jaitley.
* Loans to women self-help groups will increase to Rs 75,000 crore by March 2019.
*Government proposes to increase the target of providing free LPG connections to 8 crore to poor women: FM Jaitley
* Indian economy is on course to achieve high growth of 8%. Economy to grow at 7.2-7.5% in second half of 2018-19: FM Jaitley.
* India grew at an average of 7.5% in the first three years since 2014. It is now a $2.5 trillion economy: Jaitley.
* Indian economy has performed very well since our government took over in may 2014. It is now the seventh largest in the world, says finance minister Arun Jaitley.
* Government moves to remove stamp duty from financial transactions.
For poor, backward and vulnerable
*By 2022, every block with more than 50% ST population and at least 20,000 tribal people will have an ‘Eklayva Model Residential School’. The schools will be part of the Navodaya Vidyalayas and provide for special facilities for preserving local arts and culture besides providing training in sports and skill development.
* Allocation of funds for Scheduled Caste and Scheduled Tribes has been increased to Rs 56,619 crore and Rs 39,135 crore respectively. Jaitley said the allocation to SCs was for 279 programmes for the community and the allocation to STs was for 305 programmes for the section.
* Bharatmala project approved for better road connectivity at Rs 5.35 lakh crore.
* UDAN will connect 56 unserved airports in India.
* Airports Authority of India now has 124 airports, this will be expanded by 5 times. Aim of 1 billion trips a year: Arun Jaitley.
* Jaitley announced that a dedicated affordable housing fund will soon be launched under the National Housing Bank (NHB) scheme. He said nearly 31 lakh homes will be built in urban areas in 2018-2019 and 51 lakh in rural areas. Also, a target has been set to deliver 1.2 crore houses under the Pradhan Mantri Awaas Yojana (PMAY) scheme.
* *Government has enhanced the lending target under the MUDRA Yojana, which funds the self-employed, to Rs 3 lakh crore for the 2018-19 fiscal. Of the total loan accounts, 76% are of women and more than 50% belong to SCs, STs and OBCs.
* Total 187 projects sanctioned under the Namami Gange programme.
* We aim that by 2022, all poor people have a house to live in.
* Government plans to construct 2 crore more toilets under Swachh Bharat Mission: Arun Jaitley
* Air Pollution in Delhi-NCR is a cause for concern, special scheme will be implemented to support governments of Haryana, Punjab,Uttar Pradesh and Delhi-NCT to address it and subsidise machinery for management of crop residue: FM Jaitley
* Proposal to develop 10 prominent tourist destinations as Iconic tourism destinations.
* AMRUT programme will focus on water supply to all households in 500 cities. Water supply contracts for 494 projects worth 19,428 core awarded.
* Emoluments of the President to be revised to Rs 5 lakh per month & emoluments of the Vice-president to be revised to Rs 4 lakh per month: Arun Jaitley
* Government is proposing changes in refixing salaries of MPs. Law will provide automatic revision of emoluments of the MPs every 5 years indexed to inflation: FM Jaitley