Highlights of India’s Union Budget 2019

Smt. Nirmala Sitharaman, India’s First (Full-time) Female Finance Minister, presented the first Union Budget of the NaMo 2.0 government in the Lower House of the Parliament on 5^th July 2019. After a landslide victory in the 17^th Lok Sabha polls, there were high hopes from the budget under the Modi-led NDA’s regime. The Budget 2019 has received mixed reviews from the experts for their vision presented for a ‘New India’. However, the Finance Minister should be complimented for three things:

Articulation

Bahi-Khata (not a Briefcase)

Clarity

 

With an aim to make India a 5-Trillion Dollar economy in the next few years, Smt. Sitharaman laid the “Vision for the Decade” in front of the house with TEN key points:

1. Build Infrastructure - Physical and Social
2. Digital India – Spread across all sector
3. Environment – Pollution Free India
4. Make in India – MSMEs, Start-ups, Defence Manufacturing, Automobiles, Electronics, Fabs and Batteries, and Medical Devices
5. Water – Management and Cleanliness
6. Blue Economy
7. Space programmes – Gaganyan, Chandrayan etc.
8. Be Self Sufficient & Export – Food grains, pulses, oilseeds, fruits and vegetables
9. Woman & Children - Ayushman Bharat, Health, Safety and Equal Opportunity (Self-help Groups)
10. Team India with Jan Bhagidari.

Highlights of the Union Budget 2019

Banking & Investments

1. Attract more FDI in:

   1. Aviation
   2. Media (Animation, AVGC)
   3. 100 % FDI in Insurance intermediaries
   4. Single brand retail sectors.   
2. NPAs – Recovery of 4 Lakh Crore in last 4 years
3. PSU Banks – 70000 crores to boost capital
4. NBFCs – Pooled assets up to 1 Lakh Crore – One-time six-month partial credit guarantee to PSU banks for first loss up to 10%
5. MSMEs – Payment platform will be created.

Taxes

1. Tax Reforms
   1. Annual taxable income
      1. < 5 lakhs – Tax Exempted
      2. > 5 Lakhs – No change in tax slabs
      3. Between 2 to 5 crores – 3% hike in effective tax rates
      4. > 5 crores – 7% hike in effective tax rates
   2. Corporate Tax
      1. 25% corporate tax to be paid - Annual turnover bracket increased from 250 crores up to 400 crores – Includes 99.3% companies now
2. GST on EVs – Reduced from 12 to 5 percent
3. 2% tax on withdrawal of over Rs 1 crore in a year
4. 1.5 lakhs – Additional tax deduction on interest paid – Home loans & purchase of electric vehicles
5. PAN and Aadhaar Card – Use interchangeably to file Income Tax returns
6. 2% subvention for all GST registered MSME

Education

1. New National Education Policy -- focus on research and innovation at school and higher education level
2. National Research Foundation (NRF) - fund, coordinate and promote research
3. 400 Crores - Under “World Class Institutions” for FY 2019-20
4. Study in India – Bring foreign students to study in higher educational institutions in India
5. Higher Education Commission of India (HECI) – To promote greater autonomy & better academic outcomes – Draft to be proposed
6. National Sports Education Board for Development of Sportspersons – To be set up under Khelo India Scheme
7. Pradhan Mantri Kaushal Vikas Yojana (PMKVY) – Enable 10 million youth to take up industry-relevant skill training
8. New-Age Skills – Focus on Artificial Intelligence (AI), Internet of Things, Big Data, 3D Printing, Virtual Reality and Robotics
9. Gandhipedia – Promote Gandhian school of thought – Focus on moral development of citizens, especially youth

Infrastructure

1. 100 lakh crore – Investment in infrastructure over next five years
2. One Nation, One Grid – Blueprint of Gas Grids, Water Grids, I-Ways and Regional Airports
3. Jal Marg Vikas - Smoothening internal trade
4. Sagarmala – Improving the infrastructure for external trade
5. Bharat Mala Phase 2 - Develop national road corridors, highways and develop State road networks
6. UDAN – Air connectivity to smaller cities – Bridge rural-urban divide

 

Rural India

1. Swachh Bharat Mission – sustainable solid waste management in every village
2. Pradhan Mantri Karam Yogi Maandhan Scheme – Pension benefit 3 crore retail traders & small shopkeepers – Annual turnover < 1.5 crore
3. Effective implementation of e-NAM & pilot ‘Zero Budget Farming’ - Enhance ease of doing business for the farmers - Help farmer incomes double.
4. Mission 2022 for rural families
   1. Ujjwala Yojana - Electricity connection for all
   2. Saubhagya Yojana - clean cooking facility for all
   3. Pradhan Mantri Awas Yojana – Gramin (PMAY-G) - Housing for all

Start-Ups

10. Dedicated TV Programme – New programme to be launched within the DD bouquet of channels
11. No Tax Scrutiny – Exempted from Angel Tax scrutiny or by the IT Department
12. ASPIRE – 100 business incubators to develop  75,000 skilled entrepreneurs in agro-rural industry sectors – 80 Livelihood Business Incubators (LBIs) and 20 Technology Business Incubators (TBIs)

Women

13. Encourage Women Entrepreneurship - MUDRA, Stand UP India and the Self-Help Groups (SHG)
14. Verified SHG Members - Loan up to 1 Lakh under MUDRA Scheme – Avail Rs. 5000 overdraft facility with a Jan Dhan Account
15. Women SHG Interest Subvention Programme – Extended to all districts

Expensive V/s Cheap

Expensive	Cheap
Imported Gold, Precious Metals & Stainless-Steel Products	Imported Defense Equipment
Petrol & Diesel	Components of Electric Vehicles
Construction Materials	Cell Phones & Chargers
Cigarettes	Cameras
Auto Parts	Set Top Box
Imported Cashew Kernels	Electronic Parts (Made in India)
Split-ACs

 

Winners

Winning Side
Rural India – Numerous schemes to eliminate the rural-urban divide
Water - Jal Jeevan Mission & Jal Shakti Mantralay
Aviation – Opening of FDI
Renters – Model Tenancy Law to be finalized
Real Estate & Construction – 100 Lakh crore investment in next 5 years
Banks – Boost Capital to 70000 crores

However Defense, Wealthy & Middle Class Tax Payers, Jewellers & Gold Importers and Auto Part Makers were at a slightly loosing end.

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