Budget 2021 - India Union Budget 2021 Highlights

On 1st February 2021, Finance Minister Nirmala Sitharaman unveiled the National Budget. She started her long-awaited speech by saying that the budget rests on 6 pillars:

1.  Health and well-being

2. Finance capital and infrastructure

3. Inclusive development for aspirational India

4. Reinvigorating human capital

5. Innovation and R&D

6. Minimum government, Maximum governance

Some of the significant highlights of the speech included the proposal to disinvest two more PSBs and a general insurance company, introducing a series of hikes in customs duty to benefit the Make in India initiative, and the introduction of various infrastructure pledges in the states where polls shall be held. It is also said that the Fiscal deficit stands at 9.5% of GDP, and this is estimated to be 6.8% in 2021-2022. Personal tax income slabs remain unchanged.

Here are the highlights of Budget 2021-2022

 Health and Sanitation

• A new scheme, titled PM Atma Nirbhar Swasthya Bharat Yojana, to be launched to develop primary, secondary and tertiary healthcare 

• Mission POSHAN 2.0 to improve nutritional outcomes across 112 aspirational districts 

• Opening of 17 new public health units at points of entry 

• Modernizing of existing health units at 32 airports, 15 seaports and land ports 

• Introduction of Jal Jeevan Mission Urban aimed at better water supply nationwide 

• Strengthening of Urban Swachh Bharat Mission

Education

• 100 new Sainik Schools to be set up 

• 750 Eklavya schools to be set up in tribal areas 

• A Central University to come up in Ladakh

Infrastructure

• Vehicle scrapping policy to phase out old and unfit vehicles 

• Highway and road works announced in Kerala, Tamil Nadu, West Bengal and Assam 

• National Asset Monetizing Pipeline launched to monitor asset monetization process 

• National Rail Plan created to bring a future ready Railway system by 2030 

• 100% electrification of Railways to be completed by 2023 

• Metro services announced in 27 cities, plus additional allocations for Kochi Metro, Chennai Metro Phase 2, Bengaluru Metro Phase 2A and B, Nashik and Nagpur Metros 

• National Hydrogen Mission to be launched to generate hydrogen from green power sources 

• Recycling capacity of ports to be doubled by 2024 

• Gas pipeline project to be set up in Jammu and Kashmir 

• Pradhan Mantri Ujjwala Yojana (LPG scheme) to be extended to cover 1 crore more beneficiaries  

Tax

• No IT filing for people above 75 years who get pension and earn interest from deposits

• Reopening window for IT assessment cases reduced from 6 to 3 years. However, in case of serious tax evasion cases (Rs. 50 lakh or more), it can go up to 10 years 

• Affordable housing projects to get a tax holiday for one year 

• Compliance burden of small trusts whose annual receipts does not exceed Rs. 5 crore to be eased 

• Duty of copper scrap reduced to 2.5% 

• Custom duty on gold and silver to be rationalized 

• Duty on naphtha reduced to 2.5%. 

• Duty on solar inverters raised from 5% to 20%, and on solar lanterns from 5% to 15% 

• All nylon products charged with 5% customs duty 

• Tunnel boring machines to attract customs duty of 7%

• Customs duty on cotton raised from 0 to 10%

Economy and Finance: 

• Fiscal deficit stands at 9.5% of the GDP; estimated to be 6.8% in 2021-22 

• Proposal to allow States to raise borrowings up to 4% of GSDP this year 

• A Unified Securities Market Code to be created, consolidating provisions of the Sebi Act, Depositories Act, and two other laws 

• Proposal to increase FDI limit from 49% to 74% 

• An asset reconstruction company will be set up to take over stressed loans 

• Deposit insurance increased from Rs 1 lakh to Rs 5 lakh for bank depositors

• Proposal to decriminalise Limited Liability Partnership Act of 2008 

• Two PSU bank and one general insurance firm to be disinvested this year

• An IPO of LIC to debut this fiscal 

• Strategic sale of BPCL, IDBI Bank, Air India to be completed 

Agriculture

• Agriculture infrastructure fund  to be made available for APMCs for augmenting their infrastructure 

• 1,000 more Mandis to be integrated into the E-NAM market place 

• Five major fishing hubs, including Chennai, Kochi and Paradip, to be developed 

• A multipurpose seaweed park to be established in Tamil Nadu 

Employment

• A portal to be launched to maintain information on gig workers and construction workers

• Social security to be extended to gig and platform workers 

• Margin capital required for loans via Stand-up India scheme reduced from 25% to 15% for SCs, STs and women.