Budget 2020 Highlights : Full Details PDF Download
Minister of Finance Minister is Nirmala Sitharaman (i.e. first full time female finance minister). She has given longest budget speech for 2 hours and 40 minutes but she could not complete it due to health Issue. Last General Budget 2019-20 was presented on 5th July 2019.
Budget Origin : Word ‘Budget’ originates from the French “bougette” or leather bag.
Theme for Budget 2020
“Ease of Living” . This budget is woven around three prominent themes :
- Aspirational India in which all sections of the society seek better standards of living, with access to health, education and better jobs. Sectors included in this are Agriculture, Irrigation and Rural Development, Wellness, Water and Sanitation, Education and Skills
- Economic development for all – “SabkaSaath, SabkaVikas, SabkaVishwas”. Sectors included in this are Industry, Commerce and Investment, Infrastructure, New Economy.
- Caring Society that is both humane and compassionate where Antyodaya is an article of faith.Sectors included in this are Women & Child, Social Welfare, Culture and Tourism, Environment and Climate Change.
Minister of State in Finance Ministry is Anurag Takur.
Indian Economy Achievements
- India is now the fifth largest economy of the world in term of GDP. 7.4% average growth clocked during 2014-19 with inflation averaging around 4.5%. 271 million people raised out of poverty during 2006-16. FDI elevated to US $284 billion during 2014-19 from US $ 190 billion during 2009-14.
- Central Government debt is reduced to 48.7% of GDP (March 2019) from 52.2% (March 2014).
- Highest ever number of people in the productive age group 15-16 years in India.
- GST removed many bottlenecks in the system.
Future Aim for sustaining India’s unique global leadership, driven by Digital Revolution
- To achieve seamless delivery of services through digital governance.
- To improve physical quality of life through National Infrastructure Pipeline.
- Risk mitigation through Disaster Resilience.
- Social Security through Pension and Insurance penetration.
Union Budget 2020-21 : Receipts, Expenditure and Deficit
|Budget||2018-19 (Actual)||2019-20 (Budget Estimate)||2019-20 (Revised Estimate)||2020-21 (Budget Estimate)|
|Effective Revenue Deficit||2,62,702||2,77,686||3,07,807||4,02,719|
Govt earned 1 Rs. from below sources. (i.e Rupee Comes from)
- Borrowing & Other Liability (20 Paise)
- Goods and Service Tax (18 Paise)
- Corporation Tax (18 Paise)
- Income Tax (17 Paise)
- Non-tax Revenue (10 Paise)
- Union Excise Duties (7 Paise)
- Non-Debt Capital Receipts (6 Paise)
- Customs (4 Paise)
Rupee goes to
- State’s share of taxes & duties (20 Paise)
- Interest Payments (18 Paise)
- Central Sector Scheme (13 Paise)
- Finance Commission & Other Transfers (10 Paise)
- Other Expenditure (10 Paise)
- Centrally Sponsored Scheme (9 Paise)
- Defence (8 Paise)
- Subsidies (6 Paise)
- Pensions (6 Paise)
Component 1: Governance through Budget
- Structural Reforms
- Digital Revolution
- Inclusive Growth
Structural Reforms – GST & IBC
- Saving of about 4% of monthly spending for an average household.
- 20% reduction in turn around time for truck to load things.
- Benefits to MSMEs through enhanced threshold and composition limits.
- In last 2 years, 60 lakh new taxpayers added for GST and 105 crore e-way bills generated.
- Honorable exit through IBC.
- Clean, corruption-free, policy driven, good in intent and most importantly trusting in faith.
- Taxpayer Charter to be enshrined in the Statue will bring fairness and efficiency in tax administration.
- Companies Act to be amended to build two statues, criminal liability for certain acts that are civil in nature. Other laws with such provisions are to be corrected after examination.
- Shift to DBT – During 2018-19, 7 lakh crore transferred through DBT.
Next wave of Digital Revolution
- Digital Governance
- Improve physical quality of life through National Infrastructure Pipeline.
- Social Security through Pension and Insurance penetration
Governance guided by “Sabka Saath, Sabka Vikash, Sabka Vishwas” with focus on following points.
- Preventive Healthcare : Provision of sanitation and water
- Healthcare : Ayushman Bharat
- Clean Energy : Ujjwala and Solar Power
- Financial Inclusion, Credit support and Pension
- Affordable Housing
- Digital penetration
Component 2: Financial Sector
- Bank deposit insurance cover has been increased from Rs. 1 to 5 Lakh per depositor.
- Eligibility limit for NBFCs for debt recovery under SARFAESI Act proposed to be reduced to asset size of Rs. 100 crore or loan size of Rs. 50 lakh.
- Government to sell part of its stake in LIC via Public offering.
- Separation of NPS Trust for government employees from PFRDAI.
- Specified categories of government securities would be opened for Non-Resident investors.
- New debt ETF proposed mainly for government securities.
- Concessional corporate tax rate of 15% to new domestic companies in manufacturing and power sector.
- Tax concession for sovereign wealth fund of foreign government and other foreign investments.
Average Corporate Tax Rate
|Country||Average Tax Rate|
- Simplified GST return shall be implemented from 1st April 2020.
- Refund process to be fully automated.
- Tax benefits to Start-ups by way of deduction of 100% of their profits are enhanced by increasing turnover limit and period of eligibility.
- Concessional tax rate for cooperatives proposed.
- Turnover threshold for audit of MSMEs increased.
- Extension of time limits pertaining to the tax benefits for affordable housing.
- Issuance of Unique Registration Number to all charity institutions for easy tax compliance.
- Health cess to be imposed on import of medical equipment given these are made significantly in India.
- Dividend Distribution Tax removed i.e. Companies will no longer be required to pay Dividend Distribution Tax (DDT).
Income Tax Changes
- Around 70 of the existing exemptions and deductions (more than 100) have been removed in the new simplified regime.
- Remaining exemptions and deductions to be reviewed and rationalised in coming years.
- New tax regime to be optional – an individual may continue to pay tax as per the old regime and avail deductions and exemptions.
- Faceless appeals to be enabled by amending the Income Tax Act.
A new tax regime has been announced. Those who want to be in the old regime with exemptions, can continue.
|Income (per annum) Rate||Proposed Tax Rate||Old Tax|
|Upto 2.5 Lakh||No tax||No tax|
|2.5 to 5 Lakh||No tax||5%|
|5 to 7.5 Lakh||10%||20%|
|7.5 to 10 Lakh||15%||20%|
|10 to 12.5 Lakh||20%||30%|
|12.5 to 15 Lakh||25%||30%|
|Above 15 Lakh||30%||30%|
Component 3 : Aspiration India
This component has three sectors.
16 Action points to focus on below area. Rs. 2.83 lakh crore to be allocated for these 16 action points.
- Farmer Income
- Blue Economy
- Animal husbandry
- A budget allocation of Rs. 1.60 lakh crore for the sector comprising agriculture, Irrigation and allied activities.
- Rs. 1.23 lakh crore for Rural development & Panchayati Raj.
- Provide 20 lakh farmers to set up standalone solar pumps. Help another 15 lakh farmers to solarise their power grid.
- Agri-credit availability set at 15 lakh crore for 2020-21.
- PM-KISAN beneficiaries to be covered under the KCC scheme.
- NABARD Re-finance Scheme to be further extended.
Comprehensive measures for 100* water-stressed districts proposed.
- Rs. 1 Lakh crore fisheries exports to be achieved by 2024-25.
- 200 Lakh tonnes fish production targeted by 2022-23.
- 3477 Sagar Mitras and 500 Fish Farmer Producer Organisations to involve youth in fisheries extension.
- Growing of algae, sea-weed and cage culture to be promoted.
- Framework for development, management and conservation of marine fishery resources.
It will be set up by Indian Railway through PPP.
- To build a seamless national cold supply chain for perishables (milk, meat, fish, etc.)
- Express and Freight trains to have refrigerated coaches.
It is to be launched by the Ministry of Civil Aviation.
- Both international and national routes to be covered.
- North-East and tribal districts to realize Improved value of agri-products.
One-Product One-District for better marketing and exports in the horticulture Sectors. Balanced use of all kind of fertilizers – traditional organic and innovative fertilizers.
Measures for organic, natural and integrated farming :
- Jaivik Kheti Portal – online national organic products market to be strengthened.
- Zero Budget Natural farming to be included.
Expansion of PM-KUSUM
- 20 lakh farmers to be provided for setting up stand alone solar pumps.
- Another 15 lakh farmers to be help to solve rise the ear grid connected pump sets.
- Scheme to enable farmers to set up solar power generation capacity on the year fallow/barren lands and to sell it to the Grid.
Village Storage Scheme
- To be run by the SHGs to provide farmers a good holding capacity and reduce their logistics cost.
- Women, SHGs to regain their position as Dhaanya Lakshmi etc.
NABARD to map and geo-tag agri-warehouses, cold storages, reefers van facilities etc.
Warehousing in line with warehouse development and regulatory authority (WDRA) norms :
- Viability gap funding for setting up such efficient warehouses at the block for Taluk level.
- Food Corporation of India (FCI) and Central warehousing Corporation(CWC) to undertake such warehouse building.
Financing on Negotiable warehousing receipts (e-NWR) to be integrated with e-NAM.
- Doubling of milk processing capacity to 108 million MT from 50 3.5 million MP by 2025.
- Artificial insemination to be increased to 70% from the present 30%
- MNREGS to be dovetailed to develop fodder farms.
- Foot and mouth disease, brucellosis in cattle and best Peste Des Patits ruminants (PPR) in sheep and goat to be eliminated by 2025
Deen Dayal Antyodaya Yojana
0.5 crore households mobilized with 58 lakh SHGs for poverty alleviation.
Health and Sanitation Budget
Allocation of Rs. 69,000 crore is estimated for the health sector.
Rupees 6400 crore for Pm Arogya Yojana (PMJAY).
- More than 20000 hospitals already empanelled under PMJAY.
- Viability gap funding window proposed for setting up hospitals in PPP mode.
- Aspirational districts with no Ayushman empanelled Hospital to be covered in the first phase.
- Targeting diseases with an appropriately designed preventive regime using machine learning and AI.
- Jan Aushadhi Kendra Scheme to offer 2000 medicines in all districts.
- TB Harega Desh Jeetega campaign launched – commitment to end Tuberculosis by 2025.
- National Family Health Survey shows falling IMR and Under 5 mortality rate.
Rupees 3.60 lakh crore approved for Jal Jeevan Mission
- Rupees 11,500 crore will be allocated for the year 2020-2021
- Augmenting local Water Resort water sources recharging existing sources and promoting water harvesting and desalination.
- Cities with million plus population to be encouraged to achieve the objective during the current year itself.
- Rupees 12300 crore allocation for swachh Bharat mission in 2022-21.
- Commitment to ODF-plus in order to sustain ODF behaviour.
- Emphasis on liquid and grey water management.
- Focus also on solid waste collection source segregation and processing.
12,300 crore for Swachh Bharat Mission this year.
Proposal to set up hospitals in Tier-II and Tier-III cities with the private sector using PPP.
Education and Skills Budget
- Rs. 99,300 crore for education sector in 2021 and about Rs. 3,000 crore for skill development.
- Urban local bodies to provide internship to young engineers for a year.
- Degree level full-fledged online courses by institutions top ranked by NIRF, especially to benefit underprivileged students.
New education policy to be announced soon for policing science, forensic science and cyber-forensics.
- National Police University
- National Forensic Science University
- Budget proposes to attach a medical college to an existing district hospital in PPP mode.
- Encourage large Hospital with sufficient capacity to over resident doctors DNB courses under the national board of examination.
Special Bridge courses to be designed by the Ministry of Health and skill development :
- To fulfill the demand for teachers nurses paramedical staff and care-givers abroad.
- To bring in equivalence in the skill sets of the workforce and employers standards.
- 150 higher educational institutions to start apprenticeship embedded degree or diploma courses by March 2021.
- External commercial borrowing and FDI to be enabled for education sector.
- IND-SAT proposed for Asian and African countries as a part of study in India program.
Component 4 : Economic Development
Economic development is also necessary part of budget.
Industry, Commerce and Investment
Rupees 27300 crore allocated for 2020-21 for development and promotion of industry and Commerce.
Investment clearance sale proposed to be set up :
- To provide ‘end to end‘ facilitation and support.
- To work through a portal
Scheme to encourage manufacturing of mobile phone electronic equipment and semiconductor packaging.
National technical Textiles mission for a period of 4 years.
- To achieve higher export credit disbursement.
- Reduction in premium for small exporters.
- Simplified procedure for claim settlements.
- Higher insurance coverage.
- Expected to sport export of around rupees 30 lakh in 5 year.
A scheme to provide subordinate Dept for entrepreneur of MSMEs.
Scheme anchored by Exim Bank and SIDBI to hand hold MSM in exports market.
Turnover of Government e-Marketplace (GeM) proposed to be taken to Rupees 3 lakh crore.
Scheme for revision of duties and Taxes on exported products to be launched.
Exporters to be digitally refunded duties and taxes levied at the central, state and local levels which are otherwise not exempted or refunded.
- Rupees 100 lakh crore to be invested on infrastructure over the next five year.
National Infrastructure Pipeline
Rupees 103 lakh crore worth projects launched on 31st December 2019.
More than 6500 projects across sectors to be classified as per their size and stage of development.
Example : Rural Infrastructure, Irrigation, Renewable Power, Conventional Power, Railways, Urban and Housing, Roads.
National logistic policy to be released soon:
National Skill Development Agency to give special thrust to infrastructure focused skill development opportunities.
Project preparation facility for infrastructure project proposed to actually involve young engineers management graduates and economist from universities.
Rupees 1.7 lakh crore proposed for Transport infrastructure in 2020-21
Accelerated development of Highways.
- 100 more airports to be developed by 2024 to support Udaan scheme.
- Air fleet number expected to go up from present 600 to 1200 during this time.
Ports & Water-ways :
- Cooperating at least one major port and its listing on stock exchange to be considered.
- Governance Framework keeping with Global Benchmarks needed for more efficient seaports.
- Economic activity along river banks to be energized as per Arth Ganga concept.
There are five measures for Railway Infrastructure. These are mentioned below.
- Large Solar Power capacity to be setup alongside rail tracks on land owned by railways.
- Four Station redevelopment projects and operation of 150 passenger trains through PPP.
- More Tejas type trains to connect iconic tourist destination.
- High speed train between Mumbai and Ahmedabad to be actively pursued.
- 148 kilometre long Bengaluru and Suburban transport project.
- Excess for Railway for 2020-21 budget is 6500 crore.
- Operating ratio in percent for Railway in 2020-2021 Budget is 96.2.
- Working result estimated for gross traffic receipt is 2,25,613 and for total working expenses is 2,16,713 crore.
- Railway earning for passengers is 61,000 crore and 4 freight is 1,47,000 crore.
- Efforts to replace conventional energy metre by prepaid smart metres.
- Rupees 22,000 crore proposed for power and renewable energy sector in 2020-21.
- Expansion of national gas grid from the present 16200 kilometre to 27000 kilometre proposed.
- Further reforms to facilitate transparent price Discovery and each of transactions.
- Knowledge translation clusters for emerging Technology sectors.
- Scaling up of Technologies clusters are bring test beds and small scale manufacturing facilities.
- National Mission on Quantum Technologies and applications with an outlay of rupees 8000 crore proposed.
- Bharat net has over roll 8,000 crore budget.
Component 5 : Caring Society
It is also an important part of budget in 2020-21.
Women & Child, Social Welfare
- Allocation of rupees 35,600 crore for nutrition-related programs proposed for the financial year 2020-21.
- Rupees 28,600 crore proposed for women specific programs.
- 6 Lakh Anganwadi workers equipped with smartphones.
- Issue about age of a girl entering Motherhood proposed to appoint a task force to present its recommendation in 6 month time.
- Financial support for wider acceptance of Technologies, identified by Ministry of housing and urban affairs to ensure no manual cleaning of sewer system or septic tanks to be provided.
- Rupees 85000 crore proposed for 2020 21 for Welfare of scheduled caste and other backward classes.
- Rupees 53700 crore divided to further development and welfare of schedule tribe.
- Enhanced allocation of rupees 9500 crore provided for 2020 21 for senior citizen and Divyang.
Culture and Tourism
- Indian Institute of Heritage and conservation.
- Five archaeological sites as iconic sites.
- Museum on Numismatics and trade.
- Tribal museum in Ranchi.
- Maritime Museum in Lothal
Five archaeological sites to be developed as iconic sites with on-site museums:
- Hastinapur(Uttar Pradesh)
- Adichanallur (Tamil Nadu)
Environment and Climate Change
- Allocation – Rupees 4400 crore for 2020-21.
- Proposal to close the old thermal power plants with carbon emission above the preset norms.
- States that are formulating and implementing plans for ensuring cleaners air in cities above 1 million to be encouraged.
- PM launched coalition for Disaster Resilient Infrastructure(CDRI) with secretariat in Delhi. Second such International initiative after international solar Alliance.
National Recruitment Agency(NRA)
- An independent, professional and specialist National Recruitment Agency (NRA) for conducting a Computer Based online Common Eligibility Test for recruitment.
- A test center in every district particularly in the aspirational district.
- A robust mechanism to be involved for appointment including direct recruitment to various Tribunal and specialised bodies to attract best talents and professional experts.
New Statistics Policy
- Promote use of latest technologies including AI.
- Lay down a roadmap towards modernised Data Collection integrated information order and timely dissemination of information .
|Budget Estimates for 2020-21 (in Crore)|
|Pension 2,10,682||Interest 7,08,203|
|Defence 3,23,053||IT and Telecom 59,349|
|Major Subsidies 2,27,794||Planning and Statistics 6,094|
|Agriculture and Allied Activities 1,54,775||Scientific Departments 30023|
|Commerce & Industry 27,227||Social Welfare 53,876|
|Development of North East 3,049||Tax Administration 1,52,962|
|Education 99,312||Transport 1,69,637|
|Energy 42,725||Union Territories 52,864|
|External Affairs 17,347||Union Development 50, 040|
|Finance 41,829||Others 84,256|
|Health 67,484||Grand Total 30,42,230|
|Home Affairs 1,14,387|
Proposal to provide Rs. 1.7 Lakh crore for transport infrastructure in 2021.
Chennai-Bengaluru Expressway and Bengaluru suburban rail project to be started.
Aim to achieve electrification of 27,000 Km of lines.
Government plans to amend the Companies Act to decriminalize civil offences.
Budget 2020 Full Details PDF Download
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