Just a few months back, on 1st Feb 2019, the then finance minister of India, Piyush Goyal had presented an interim budget. Interim Budget is presented when the Lok Sabha elections are ahead and the government doesn’t have time to present a full budget.The full budget is presented by the elected government.

As the Bharatiya Janata Party led by Prime Minister Mr. Narendra Modi returned for a second term in power, the newly appointed Finance Minister Ms. Nirmala Sitharaman  unveiled a union budget for 2019-2020 on 5th July. This financial budget was very important for India, as it’s going to become a guide for upcoming policies and reforms for next 5 year by the government. This budget has been presented with a 10-year vision and has laid out the roadmap and announced measures to address many aspects of the economy.

The total budget of India is largely divided into the following segments by the finance minister  - rural, urban, women and farmers.  While presenting her first budget, Ms. Sitharaman highlighted many positive developments during  her party’s previous term (2014-19) and mentioned the period as performing government. She also introduced many structural reforms and changes to further boost our economy.

Vision for next 10 years

1

Physical and Social Infrastructure

2

Digital India

3

Pollution free India

4

Make in India

5

Clean rivers and water management 

6

Blue economy

7

Space programmes

8

Agricultural reforms

9

Healthy society

10

Team India with Jan Bagidari

Here are the highlights of the Union Budget:

Economy:

  • While presenting the union budget of India, FM mentioned the need to invest in structural reforms to lead India towards growth and turn into a $5 trillion economy by 2025.

  • Electronicns working for social welfare objectives. Fundraising Platform, a social stock exchange, to be set up to list social enterprises and voluntary organization.

  • Local sourcing norms for FDI to be eased for single-brand retailing sector.

  • Pension benefit to be extended to around 3 crore retail traders and shopkeepers with an annual turnover less than 1.5 crores under Pradhan Mantri Karam Yogi Man Dhan Scheme.

  • In order to make India more attractive FDI destination, the government will examine suggestions of further opening up FDI in aviation, media, animation AVGC and insurance in consultation with stakeholders. 100% FDI to be permitted for insurance intermediaries.

  • A new series of coins of Rs.1, Rs. 2, Rs. 5, Rs. 10 and Rs. 20 easily identifiable to the visually impaired are to be made available for public use shortly.

  • Government intends to open 4 new embassies in 2019-2020.

Tax Proposals:

  • Enhanced interest deduction up to Rs. 3.5 lakhs for purchase of a house costing below 45 lakhs.

  • Aadhar and PAN to be made interchangeable for the ease of tax payers.

  • GST on Electronic Vehicles lowered from 12 % to 5 %.

  • Additional income tax reduction of 1.5 lakh rupees on interest paid for electric vehicles.

  • Proposed to increase customs duty on imported gold and other precious metals from 10 to 12.5%.

  • Increase in Petrol and diesel prices.

  • Angel tax relief for start-ups who submit documents.

  • No income tax on annual income below Rs.5 lakh.

  • Ms. Nirmala Sitharaman kept the income tax slab rates unchanged but announced a slew of new income tax proposals.

Towards Women Empowerment:

  • One woman in every SHG (Self Help Group) shall be made eligible for a loan of Rs. 1 lakh under MUDRA scheme.

  • Every verified woman SHG member having a Jan Dhan account, an overdraft of Rs.5000 will be allowed.

  • To encourage women entrepreneurship, Women SHG Interest Subvention Programme to be expanded to all districts in India.

Benefits for Businesses, MSMEs:

  • Payment platform for MSMEs to be created.

  • TDS of 2% on cash withdrawal exceeding Rs.1 crore in a year from a bank account to encourage digital transactions.

  • Threshold for applicability of lower corporate tax rate of 25% increased from Rs.250 crore to RS 400 crore.

  • Taxpayers with an annual turnover of less than Rs.5 crore can file only quarterly returns.

  • Under the interest subvention scheme for MSMEs, Rs. 350 crore to be allocated for the year 2019 for 2% interest subvention for all GST-registered MSMEs on fresh or on incremental loans.

Gains for NRI :

  • Aadhaar card for NRIs with Indian passports to be issued after their arrival in India, without waiting for the mandatory 180 days.

  • To provide NRIs seamless access to Indian equities, NRI portfolio investment route to be merged with foreign portfolio investment route

Rural India:

  • Jal Shakti Mantralaya will work with states to ensure Har Ghar Jal for all rural houses by 2024, under Jal Jeevan Mission.

  • Schemes such as BharatMala, Sagarmala and UDAN are bridging rural urban divide and improving our transport infrastructure.

  • 100 new clusters to be set up in 2019-20 under SFURTI, which will enable 50,000 artisans to join the economic value chain.

  • To bridge the rural-urban digital divide, BharatNet is targeting internet connectivity in local bodies in every panchayat in the country.

Agriculture:

  • Proposed the need to replicate Zero Budget Farming, to go back to basics, which will help Doubling Farmers Income.

  • Pradhan Mantri Gram Sadak Yojana is envisaged to upgrade 1.25 lakh km of road length at an estimated cost of 80,250 crore rupees to bring more villages to rural markets.

  • 80 Livelihood business incubators and 20 technology business incubators to be set up in 2019-20 under ASPIRE to develop 75,000 skilled entrepreneurs in agro-rural industries.

  • 10,000 new farm produce organisations.  

Banking Reforms:

  • Standup India will now be continued for the entire period coinciding with the 15th Finance Commission, i.e. 2020-2025. The banks will provide financial assistance for demands based businesses.

  • Public sector banks to be provided 70,000 crore rupees to boost capital and improve credit.

  • Government will give one time 6 month partial credit guarantee to public sector banks.

  • Regulation of HFCs (Housing Finance Cos) to move to RBI from National Housing Bank. 

Railway Budget:

  • Allocation of Rs 65,837 crore and the highest ever outlay for capital expenditure amounting to Rs 1.60 lakh crore for the development of railways.

  • A new Public-Private Partnership model to be unleashed for faster development of Indian railways.

  • Government will complete the dedicated freight corridor project by 2022. 

  • Special Purpose Vehicles will be encouraged to invest more in suburban rail network. 

  • Railway infrastructure requires an investment of Rs 50 lakh crore between 2018 and 2030.

  • Huge programme to be launched in 2019 to modernise our railway stations to make world class railway infrastructure.  

Space Sector:

  • Budget 2019 proposes to establish a National Research Foundation to fund, to coordinate and to promote research in the country.

Sports:

  • To popularize sports at all levels, National Sports Education Board for development of sportspersons to be set up under Khelo India.

Education:

  • Major changes in higher as well as school system to be brought in to transform Indian educational system. The latest budget has also proposed to bring new National Educational Policy to take higher education in India to the international level. 

  • The FM proposed an allocation of Rs. 400 crore for world class higher education institutes in FY20.