Every thing you should know about budget 2021.(Budget Highlights).

Economics 15 May 2021 1:40:PM

budget-2021-updates budget-2021-updates

Union finance minister Nirmala Sitharaman presented at Parliament Monday the Union Budget 2021-22, which came at a time when India's economy is reeling under the aftereffects of the Covid-19 triggered lockdown. Sitharaman declared a total expenditure of approximately Rs 2 lakh crore on healthcare, Rs 35,000 crore for the Covid-19 vaccine, Rs 1.10 lakh crore for railways during her speech, and said the government intends to complete 11,000 km of national highway infrastructure this year. In the 2021-22 budget, meanwhile, Rs 2.5 was levied on petrol and Rs 4 on diesel per liter of Agri infra cess.

Sitharaman said during her budget speech that the government is committed to the welfare of farmers, adding that the MSP regime has undergone a "sea change" to ensure prices are at least 1.5 times the cost of production, with a sharp rise in food grain procurement and farmers' payments. She also said that in the last six years, the procurement of crops such as paddy, wheat, pulses, and cotton has jumped manifold.

Areas covered in the speech of budget 2021:- 

The Honourable FM started the budget speech with a key emphasis on the following:

1. Doubling farmers' income

2. Strong Infrastructure

3. Healthy India

4. Good Governance

5. Opportunities for Youth

6. Education for All

7. Women Empowerment, and

8. Inclusive Development

Some of the key announcements made were as follows:-

FY’21 fiscal deficit (Revised Estimate) pegged at 9.5% of GDP; fiscal deficit is seen at 6.8% for FY22 Divestment target for FY22 at Rs 1.75 lakh cr. The government is asking Niti Aayog to work on the next list of PSU cos that could be taken up for divestment. Other than IDBI Bank, two other PSBs and one general insurance company to be divested in FY22. 

RURAL

  • Aim to double farmers' income. The total financial impact of all AatmaNirbhar packages including measures taken by RBI was estimated to be about Rs 27.1 lakh crores.
  • A portion of the agricultural fund will be allocated to APMC for furthering their infrastructure.

HEALTHCARE

  • A new scheme called PM Aatmanirbhar Swastha Bharat to be launched, an outlay of Rs 64,180cr over 6 yrs. 17,000 rural and 11,000 urban health and wellness centers to be set up.
  • FY22 outlay (budget estimate) for health & well-being up 138%, is Rs 2,23,846 cr.

AUTO

  • Announcing a voluntary scrapping policy to phase out polluting vehicles. Vehicles to undergo fitness tests after 20 years for personal vehicles and 15 years for CVs. 

INFRA: 

  • Professionally managed development financial institution (DFI) will be introduced with an allocation of 20,000cr. For 2021-22; capital expenditure saw at Rs 5.54 lakh cr, +34.5% increase YOY.
  • Over and above this, Rs 2 lakh crore will be provided to states and autonomous bodies to nudge their expenditure. FY 22 allocation for Railways at Rs 1,10,055cr.
  • Propose Rs 40000 Crore outlay for FY22 Rural Infra Fund. Indian Railways has prepared a National Rail Plan for India 2030. The plan is to create a future-ready railways system by 2030 - bringing down the logistic cost for the industry is at the core of a strategy to enable Make in India.

BFSI

  • Propose to amend the Insurance Act, propose to hike FDI limit to 74 percent from 49 percent. Also to allow foreign ownership & control with safeguards.
  • To provide Rs 20,000 crore in FY22 for the recapitalization of public sector banks.
  • Asset reconstruction and management company to be set up for stressed assets of banks.
  • The government plans to further strengthen the NCLT framework and continue with the e-court system for faster resolution of bad debts.

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