Finance Minister Nirmala Sitharaman today presented Union Budget 2021 like never before. She ditched the traditional ‘bahi-khata’ and presented India’s first paperless Budget from a Made-in-India tablet.
“The preparation of this Budget was undertaken in circumstances like never before, in view of calamities that have affected a country or a region within a country. But what we have endured with COVID-19 to 2020 is Sui generis. When I presented the budget last year we could not have imagined that global economy would be pushed to contraction,” the FM said.
The government announced 5 mini-budgets in 2020 including Atmanirbhar Bharat packages and PM Garib Kalyan Yojana. The total financial impact of all these packages, including measures taken by RBI, was about Rs 27.1 lakh crore, more than 13% of GDP, she added.
Here are the key highlights from the Union Budget 2021:
- With major focus on health infrastructure, PM Atma Nirbhar Swasthya Bharat Yojna to be launched soon. In addition to the National Health Mission, Rs 64,180 cr spending plan for healthcare over the next 6 years. Also, Rs 3,500 cr for COVID-19 vaccine in 2021-22.
- Setup of 17,000 rural and 11,000 urban health and wellness centres. Also, integrated public health labs to be set up in each district.
- Voluntary vehicle crapping policy to be announced soon.
- Mega investment textile park scheme to be launched, in addition to the PLI scheme. Seven textile parks to be established over 3 years.
- Lending portfolio of 5 lakh crore for this DFI within 3 years. National Monetisation Pipeline for brown filed assets will be launched.
- Highway projects: 500 km of national highway works in Tamil Nadu at an investment of 1.03 lakh crore; 1100 km in Kerala at an investment of Rs 6500 crore; 6075 km in West Bengal at a cost of Rs 25,000 crore; 1.18 lakh crore for Ministry of Road Transport and Highways.
- Railway projects: National rail plan for India 2030; vistadome coaches in tourist routes; automatic train protection system in busy corridors; New dedicated freight corridors- Itarsi-Vijaywada, Kharagpur-Vijayawada and Bhusawal-Dankuni.
- Framework to break monopolies in energy and power distribution companies. New Power scheme outlay: Rs 3,05,984 crore over 5 years.
- A new scheme to facilitate flagging of ships in India; 7 projects worth Rs 2000 crore will be offered at major ports in FY21-22; scheme for promoting flagging of merchant ships with outlay of Rs 1,624 crore over 5 years.
- Rs 1000 crore for solar energy commission
- The govt has set a fiscal deficit target of 6.8% for the net financial year. For the current financial year, the government had pegged the fiscal deficit at 3.5% for FY21 in the last budget before the onset of the Covid-19 crisis.
- One-person companies: No restriction on paid-up capital and turnover, to incentivise incorporation of one-person companies. Conversion of one-person company to any other kind, reducing residency limit from 182 days to 120 days. Non-resident Indians allowed to incorporate one-person companies in India.
- The FM proposed to revise definition under Companies Act, 2013 for small companies by increasing their threshold for capitalization to not exceeding Rs 50 lakh to not exceeding Rs 2 crore and turnover not exceeding Rs 2 crore to not exceeding Rs 20 crore
- Government allots Rs 20,000 crore for bank recapitalisation, as FM emphasizes the need to clean up banks’ books
- FDI limit in insurance increase to 74% from 49%.
- Finance Minister Nirmala Sitharaman in the Union Budget 2021-22 announced that senior citizens (above 75 years) with only pension or interest as income will be exempted from filing I-T returns.
- An anonymous dispute redressal platform will also be set up for small taxpayers.