HIGHLIGHTS OF TODAY’s INDIA BUDGET 2022-2023

Article 112 of the Indian constitution states that the annual budget is a statement of estimated expenditure of the government for the complete year. It will be released on 1^st of February every year and gets in to implementation from 1^st April to 31^st March of the following year. Earlier, before 2017, the railway budget used to be dealt separately but it was merged with the union budget thereafter. And it must be passed by the Lok Sabha. The Economic Survey of India which is prepared by the suggestions of the Chief Economic Advisor will be presented in both the housed during the official budget session by the Union Finance Minister.

Nirmala Sitharaman, Union Finance Minister, presented the Union Budget on 1^st February, 2022 for FY2022-2023. The budget plan presented today is the fourth budget released under the Narendra Modi’s government. In today’s budget which was announced for the year 2022-2023, quite a few measures were taken keeping in mind the uncertainty that the pandemic caused to us. Lot of measures were taken to protect number of sectors from any loss and aimed at their growth. In today’s budget plan released by the Union Finance Minister, there were a major changes made to the personal income tax composition which was demanded from different sectors for any relief in times of pandemic. The decision of 30% of digital asset transfers for tax receivers received a major concern and attention at times. And the least concern was given to the idea of releasing digital rupee which is also big news item. This year’s budget plan focuses more on the middle class and the Finance Minister, in the meeting, said that this year budget plan aims to set down strong foundations for Amrit Kal that is from India at 75years to India at 100years. PM Gati Shakti which aims to bring mobility in India, climate action and financing of investment, energy transmission, productivity enhancement, inclusive development are the key areas added and focused.

The issue that caught the eye of most of them is that the income tax slabs were kept unchanged for this FY2022 and 2023 keeping in mind the pandemic situation in the country.

A few highlights of today’s budget are addressed below:

• This year the government is with the aim to increase the spending on infrastructure. In furtherance to this idea, there were expectations to see a higher allocation for water, roads and railways comparatively to the previous years. As a part of the same, the national highways are to be expanded by a large number that is by 25,000km. The target was also set to introduce Vande Bharat trains by a large number of 400 in the next three years. To discuss more about the transportation sector, a 2,000 km of rail network to be brought under KAWACH scheme for the purpose of safety and capacity amplification. In respect to the railway sector, this particular ministry is to be allocated with Rs. 140367.13 crore, which is Rs 20,311 more than the previous year. One product one railway station is to be given more attention this time.
• Supporting MSME is one of the major concern this time. In light of the same, digitisation, ease of tax acquiescence., simplification etc. are expected to be in focus.

1. DEFENCE SECTOR:

• This time in the defence sector, Aatmanirbhar Bharat Scheme is more in light and was given importance. According to Finance Minister, 68% (increased from 58% from previous year) of the annual budget in defence sector would be assigned for domestic/local industry.
• Research and development industry will be opened in this sector with 25% of research and development budget.
• Design and development of military related equipment will be dealt by private industry in collaboration with DRDO through Special Purpose Vehicle model.

3. TAXES:

• Government preferred to stick to predictable tax regime and aims to keep it stable for this year.
• Any Income Tax Returns filed will be dealt by the Government by providing one-time window to correct the same and for which the updated returns will be provided in two years.
• Additional payment on long-term capital gains limited at 15%.
• Gifts and gift of cryptocurrencies to be taxed
• The Alternate Minimum Tax for cooperative societies to be cut to 15%.
• For those people whose income is between Rs 1 crore and Rs 10 crore, the Proposal is introduced to reduce any extra charges on cooperative societies to 7%

4. AGRICULTURE AND ENVIRONMENT SECTOR:

Rs. 44,605 crores were allotted for the purpose of implementing Ken-Betwa linking project. The main motive behind this is to benefit lakhs of farmers and provide good drinking water to lakhs of people and to generate both hydro and solar power. There’s also an allocation of 19,500 crores to ease the process of manufacturing solar modules through solar plants by 2030.

• Carbon intensity is now addressed to be one of the major concern against the environment and funds are allotted in this budget plan to reduce that intensity.
• Sovereign green bonds to be launched for the purpose of government’s borrowing programme in FY23
• Government to pay Rs 2.37 lakh crore towards advancement of wheat and paddy under Managed Service Provider operations
• Kisan Drones are to be used for crop assessment, spraying of insecticides which is now an advancement in agriculture sector. However, government is more keen to promote chemical-free farming to boost farmer’s income and agricultural productivity.
• NABARD to act as the financial source to start-ups’ for agriculture.

5. FINANCIAL SECTOR:

• Rs 1 lakh crore was allocated for this particular sector to all the states for a better assistance for this year. As this year is a way different from the previous years, this sector is given more importance.
• A proposal was laid down before the parliament through this budget for the Digital Rupee by Reserve Bank of India using block-chain technology. This is most probably to start from this year.
• Private capital in the infrastructure sector is planned for this year and the Measures will be taken to set up the same.
• Digital rupee will be introduced by 2023.
• 5 lakh post offices will be set up on the core banking system, to promote mobile banking, net banking which will help farmers, people in rural areas, senior citizens. In furtherance, 75 districts are to be enriched with 75 digital banks.
• For the faster dispute resolution, the government to come up with the international arbitration centre.
• The differently abled dependent during will be paid annually after their guardians or parents attain the age of 60years.

6. HEALTHCARE SECTOR:

• A platform for the national digital health will be raised up.
• 95% of 112 aspirational districts have made better progress in health and infrastructure.
• Mental health is given a limelight in this budget plan and as a step forward for the same, a National Tele Mental Health Program was announced by the Finance Minister in this year budget plan.

7. TELECOM SECTOR:

• 5G network to be introduced. Its manufacturing to be launched for 5G ecosystem as part of Postal Life Insurance scheme. Also, it is going to be designed in such a way that it is affordable to everybody including rural and remote areas.
• 5% of USO Fund to be provided for technology modernisation and Research & Development.
• BharatNet project under Point-to-point protocol (PPP) model to be upgraded in this year.
• The optical fibre network is the target set up by the government especially in rural areas by 2025.

8. WOMEN AND CHILDREN:

• Three schemes were introduced in the recent budget for FY2022 and 2023 for the development of women and children and for recognition of importance of ‘NARI SHAKTI”.
• Child health being the matter of concern, two lakh anganwadis are to be upgraded.

9. EASE OF BUISINESS AND LIVING:

• 75,000 agreements have been eliminated and 1,486 union laws repealed for the purpose of easy working of business.
• Ease of Living and Ease of Doing Business 2.0 to be geared up.
• Voluntary exit for corporates to be shortened from the period of 2 years to 6 months
• Replacement of Special Economic Zones Act with a new law as soon as possible.

10. HOUSING AND URBAN PLANNING:

• PM Awas Yojana is now devoted with Rs 48, 000 crores for this FY22-23’s budget. And under this scheme by the government, 80 lakh houses will be completed. Apart from that, 60,000 crore amount is identified as beneficiaries for this scheme particularly in urban and rural areas.
• 8 crore households are to be devoted with the access to tap water and 60,000 crores is allocated for the same.
• A high-level committee to be set up for the housing plans, its implementation and governance as well.
• Rs 250 crores allocated for academic institutions for urban planning which is to be designated as Centre for Excellence.
• By-laws for Modern building projects and schemes will be introduced. Along with the high level panel.
• Government now aims to promote use of public transport in urban areas
• The government also proposed to reduce Minimum Alternative Tax to 15% for cooperative societies.

11. MSMEs AND STARTUPS:

• Rs 6,000 crore programme will be introduced to rate MSMEs over five years
• E-shram, Udyam, Aseem portals, NCS are a few MSME platforms which will now be inter-linked and also their scope will be widened. They will now function as the organic database portals.
• A fund is raised for NABARD to finance the startups in rural and agriculture enterprises. Start-ups will now be promoted more as per the motive and target of the government this year. An expert committee is also proposed to be set up for the purpose to suggest the measures to increase the investment rates for the start-ups’.
• In the previous year budget plans, tax benefits for start-ups were offered reclamation of taxes for 3 consecutive years and for this year it is to be extended by 1 more years.

12. EDUCATION:

It is not unknown that this year education is one of the most affected area due to covid-19. Finance Minister Nirmala Sitharaman while addressing it, she made proposal of a digital university for a better education system to the Indian students. As things mostly shifted to the online mode, the budget also promotes the same thing. And this is done by the decision to launch online platforms and also to distribute smartphones to help the students especially in rural areas.

States to be encouraged to promote syllabus for agricultural universities, organic farming, and anything to meet needs of natural, organic, zero-budget farming.

• PM eVIDYA is now added with one more program called One class, one TV channel’ with 200 TV channels.
• This year there is also a proposal to provide education in regional languages for classes 1 to 12
• To make up for the loss that caused to the students is the concern. And in order to cover the same 1-Class-1-TV Channel to be implemented.
• The government is to launch National Skill Qualification Framework (NSQF).

Just as every other time, there are people for and against the budget plan. Experts and many opposition leaders criticised this budget 2022 and held it to a Zero sum budget under the Modi government. They said the middle class, poor, youth, MSMEs and farmers were ignored and are of the opinion that the schemes introduced for them through this year’s budget is not up to the mark for their betterment in any way. They say that, this budget plan did not address concerns of any section and it did not focus on the relief as well. In this hard times of pandemic people had high expectations on the budget. Experts say that they are really upset with it as farmers were mostly ignored and they felt that unemployment and inflation caused in the previous years is not duly addressed. Also, they are upset regarding the tax slabs as they remain unchanged this year. On the other hand, it is also appreciated as it laid focus on mental health as well. It is also supported by a few experts stating that it has a long distance vision for the country. Though the middle class and common man are slightly ignored in this budget 2022, it is believed that it is good for the economy. The government is very particular about the tax this time and attracted much negativity but also there are people who understood the long term benefits from it. However, the main focus this time is on the economy, infrastructure and tax and financial sector as the country had to go through a lot in the previous year like inflation and unemployment etc. The government is also aiming to increase 12% or by Rs 260 Lakh crores by the next year that is for FY2023 -2024. Overall, it is not to the benefit of middle class people nor it is giving any relief to them and to those who lost their jobs this year. Along with the same, it is also disappointing to the taxpaying middle class people, but it is hoped that it is good for the economy of this country at the end.