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Informist, Tuesday, Jul 23, 2024

MUMBAI - Highlights of the Union Budget for 2024-25 (Apr-Mar), presented by Finance Minister Nirmala Sitharaman in Lok Sabha today:

FY25 ESTIMATES

* FY25 fiscal deficit pegged at 4.9% of GDP
* FY25 total expenditure seen at 48.21 trln rupees
* FY25 total receipts seen 32.07 trln rupees
* FY25 gross market borrowing pegged at 14.01 trln rupees

* FY25 net market borrowing pegged at 11.63 trln rupees
* FY25 net sovereign gold bond receipts seen at 150 bln rupees

* FY25 gilt repayments pegged at 2.38 trln rupees

* FY25 gilt switches pegged at 1.50 trln rupees

* FY25 miscellaneous capital receipts 500 bln rupees

* FY25 net short-term borrowing pegged at (-)500 bln rupees

* FY25 borrowing from small savings seen at 4.20 trln rupees 
* FY25 net tax receipts of Centre seen at 25.83 trln rupees

* FY25 capex target 11.1 trln rupees, 3.4% of GDP

* FY25 effective capex seen at 15.02 trln rupees

* FY25 fiscal deficit pegged at 16.133 trln rupees

* FY25 revenue deficit pegged at 5.802 trln rupees
* FY25 nominal GDP growth seen at 10.5%
* FY25 dividend, profits receipts seen at 2.891 trln rupees
* FY25 food subsidy seen at 2.053 trln rupees

* FY25 fertiliser subsidy seen at 1.640 trln rupees

* FY25 petroleum subsidy seen at 119 bln rupees

* FY25 pension outgo seen at 2.433 trln rupees
* FY25 defence outgo seen at 4.548 trln rupees
* FY25 interest payments seen at 11.629 trln rupees
* FY25 PSU capex seen at 9.137 trln rupees

* FY25 transfer to states seen at 23.490 trln rupees

* FY25 MGNREGA outlay 860 bln rupees, unchanged from interim Budget
* FY25 NHAI outlay 1.685 trln rupees, unchanged from interim Budget
* FY25 corporate tax mop-up seen at 10.20 trln rupees
* FY25 income tax mop-up seen at 11.870 trln rupees
* FY25 GST mop-up seen at 10.619 trln rupees
* FY25 drawdown on cash seen at 1.40 trln rupees

FY24 REVISED

* FY24 fiscal deficit revised to 16.537 trln rupees
* FY24 revenue deficit revised to 7.656 trln rupees

* FY24 food subsidy revised to 2.123 trln rupees

* FY24 fertiliser subsidy revised to 1.889 trln rupees

* FY24 petroleum subsidy revised to 122 bln rupees

* FY24 interest payments revised to 10.639 trln rupees

* FY24 transfer to states revised to 20.990 trln rupees

FISCAL HEALTH

* Global economy still in grip of policy uncertainties

* High asset prices, political uncertainty pose risks to growth

* India's economic growth shining, exception to global headwinds

* India's inflation continues to be low, stable

* High asset prices, political uncertainty pose risks to inflation

* India's inflation continues to move towards 4%

* Core inflation currently at 3.1%

* Steps announced in Interim Budget are well underway

* Endeavour to reduce debt-GDP ratio beyond FY26

REFORMS

* PM plan for 5 schemes for 41 mln youth to cost 2 trln rupees

* To strengthen previously announced steps for Viksit Bharat

* Urban development also a priority for Viksit Bharat

* Manufacturing, services a priority of FY25 Budget
* Next Budgets will build upon pillars announced today

* Infra a priority of Budget
* To undertake sustained efforts for 9 priorities under Viksit Bharat

* Sixth priority is energy security

* Innovation, research and development 8th priority

* Next generation reforms 9th priority

* Will build on detailed formulation of economic policy framework
* Fast-tracking rural economic growth the policy goal

* To launch 3 schemes for employment-linked incentives
* Moot 1 month wage for 1st time employees entering formal sector
* To give support to employees, employers for EPFO enrolment
* Plan job creation scheme for manufacturing sector
* DBT of one-month pay in 3 tranches of 15,000 rupees under PM plan
* To incentivise employers, employees in manufacturing sector for first 4 years
* New scheme will benefit 3 mln employees, their employers
* Extra allocation towards capital investment for economic growth

* To form economic policy framework to focus on job generation

* Economic reforms to cover all factors of production, technology
* To begin improving productivity of factors of production

* To develop taxonomy for climate finance

* Successfully used technology for better productivity in last 10 years

* Working on Jan Vishwas Bill 2.0 for ease of doing business

* Used technology for inclusive development in last 10 years

* To actively use technology for better data governance

DIRECT TAX

* It has been our endeavour to simplify taxation
* Undertook measures to simplify taxation such as new tax regime
* 58% of corporate tax came from new tax regime in FY23
* Review of Income Tax Act aims to reduce dispute, litigation
* Review of Income Tax Act to be completed in 6 months
* To merge 2 tax exemption regimes for charities
* TDS rate on e-commerce operators to 0.1% from 1%

* To decriminalise delay in payment of TDS by due date
* To provide standard operating procedures for TDS defaults
* To simplify, rationalise compounding norms for TDS defaults

* To simplify, rationalise capital gains tax
* To reopen assessment post 3 years, up to 5 years only for some cases
* Short-term capital gains tax on some assets will be 20%
* All other financial, non-financial invest to attract tax slab rate
* LTCG on all financial, non-financial assets to be 12.5%
* Can reopen cases if escaped income over 5 mln rupee for 5 years
* Unlisted bonds, debentures to attract tax on capital gains
* To up LTCG exemption on some financial assets to 125,000 rupees/year
* Debt mutual funds to attract tax on capital gains
* Digitised services for tax payers under GST, customs

* Remaining customs, income tax services to be digitised in 2 yrs
* Top priority is to cut litigation, appeals

* To deploy more officers to hear tax appeals
* Propose Vivad se Vishwas scheme 2024 for income-tax disputes
* To expand scope of safe harbour rules to cut litigation
* Few proposals to promote investment, foster employment
* To streamline transfer pricing procedure
* Propose to abolish angel tax for all investor classes

* Tax changes announced today to help bolster start-up ecosystem
* Safe harbour rates for foreign miners selling raw diamonds
* To cut corporate tax on foreign cos to 35% from 40%
* STT on futures raised to 0.02%
* STT on options raised to 0.1%

* To tax income received on buy back of shares in hands of recipient

* Propose employees' deduction for NPS to 14% from 10%
* Aim to improve social security of India employees
* To withdraw equalisation levy of 2%
* To decriminalise non-reporting of MNC ESOPs up to 2 mln rupees
* Expanding some tax benefits to GIFT-IFSC
* Standard deduction raised to 75,000 rupees in new tax regime
* No tax on income up to 300,000 rupees under new regime
* 5% tax on 300,000-700,000 rupee income under new regime
* 10% tax on income of 700,000-1,000,000 rupees under new regime

* 15% tax on income of 1.0-1.2 mln rupee under new regime

* Tax rate of 20% unchanged on income of 1.2-1.5 mln rupees

* Tax rate of 30% unchanged on income of over 1.5 mln rupees

* High standard deduction in new regime to benefit 40 mln people
* Total revenue foregone on tax about 70 bln rupees/year
* 300 bln rupees revenue to be mobilised on tax changes
* 370 bln rupees revenue forgone on tax changes

* 290 bln rupees revenue forgone on direct tax changes

INDIRECT TAX

* Strive to further simplify, rationalise GST structure
* Customs duty proposal to help domestic manufacturing, promote exports
* Customs duty proposal to simplify taxation
* To review customs duty structure over next six months
* To exempt three more cancer medicines from customs duty
* To review customs duty over 6 months to boost ease of business
* Change customs duty on X-Ray tubes, machines
* To cut customs duty on mobile phones, chargers to 15%
* To exempt customs duty on 25 critical minerals
* To reduce basic customs duty on 2 critical minerals
* Propose not to extend customs on solar energy-related parts
* To reduce customs duty on some broodstock, fish feed to 5%

* Customs duty cut to boost export of marine products
* To cut customs duty on real duck, goose down filling
* To cut customs duty on chemicals for making spandex yarn
* To cut customs duty of manufacturing leather, footwear, other articles
* Customs duty on platinum to be cut to 6.4%
* To rationalise export duty structure on raw hides, skin
* Aim to enhance export competitiveness of leather goods
* To remove customs duty on ferro nickel, blister copper
* Exempt customs duty on manufacture of connectors
* Exempt customs duty on oxygen-fused copper
* To raise customs duty on PVC flex banners to 25% from 10%
* To up customs on specified telecom equipment to 15%

* 80 bln rupees revenue forgone on indirect tax changes

SOCIAL SECTOR

* Employment and skilling second priority

* Inclusive human resource development 3rd priority

* Focus on employment, skilling, MSMEs, middle class

* We need to focus on poor, women, youth and farmers

* Made provision of 1.48 trln rupees for education, skilling

* National policy for development of cooperative sector
* Employment generation in cooperative sector a policy goal

* To facilitate higher participation of women in workforce

* Two mln youth will be skilled under new PM scheme over 5 years
* To open working women hostels in collaboration with industry
* New centrally sponsored skilling scheme
* 1,000 industrial training institutes to be upgraded
* Women-specific skilling options in collaboration with industry
* To design new courses as per skilling requirements
* Model skill loan of 750,000 rupees from govt-promoted fund
* Model skill loan to help 25,000 students every year
* To give loans up to 1 mln rupees for higher domestic education
* Govt is committed to all-round, all-inclusive development
* 100,000 e-vouchers/year for 3% interest rebate on education loan
* To step up schemes for artisans, craftsmen, street vendors
* To step up schemes for women entrepreneurs, SCs, STs

* To make allocations for 30 mln more houses in PM Awas plan
* Allocated over 3 trln rupees for women-centric schemes
* New schemes underline commitment to women-led development
* To launch PM Janjati Unnat Gram Abhiyan plan for tribals
* Scheme for tribal community to benefit 50 mln people

* Internship in 500 top cos to 10 mln youth in 5 years
* Companies to bear training, internship cost from CSR funds
* Exposure for youth for 12 months in businesses under new scheme

* To give internship allowance of 5,000 rupees/month under scheme
* To give one-time internship aid of 6,000 rupees under scheme

* Rental housing facility for industrial workers in PPP mode

* PM urban housing plan 2.0 for 10 mln urban poor, middle class
* Provision of interest subsidy under urban housing plan
* PM urban housing plan outlay 10 trln rupees
* Govt to allot 2.2 trln rupees for urban housing plan for 5 years
* To promote water supply, sanitation along with states, banks
* To promote water supply, sanitation for 100 large cities
* Enabling policy, regulation for transparent rental housing market
* New scheme to help better availability of rental housing
* To develop 100 weekly haats in cities under PM-Svanidhi plan
* To encourage states to moderate stamp duty

* Lower stamp duty for women key part of urban development plans
* To encourage states to cut stamp duty for women

* Land related reforms to cover land administration planning
* To digitise urban land records
* To assign unique land identification pin under rural actions
* Better land records to help finances of urban local bodies
* To integrate e-shram portal with other portals
* Survey of subdivision under rural actions
* Open architecture database for an evolving labour market
* Rural action plans to help credit flow
* To facilitate wide array of services to labour
* To revamp Shram Suvidha portal for ease of compliance

FARM SECTOR

* Taking steps to ensure supply of perishables to market

* To give funding in challenge mode to agriculture research
* To review agriculture research setup for climate resilient variety
* To release 109 varieties of 32 crops
* To include domain expert to oversee farm research
* To initiate 10 mln farmers into natural farming over 2 years
* Will help natural farmers with certification and branding
* Natural farming implementation through scientific research
* Launch mission to strengthen output of pulses, oilseeds
* To set up 10,000 need-based bio resource centres
* To develop vegetable clusters closer to consumption centres
* To promote farmer-producer agencies, co-ops for farm supply
* Launch mission to boost storage, marketing of pulses, oilseed
* To promote farmer-producer agencies, co-ops for farm storage
* To boost farmer-producer agencies, co-ops for farm marketing
* To conduct digital kharif crop survey in 400 districts in FY25
* To implement digital public infra for agriculture for 3 years
* Farmer, land registry to have details of 60 mln farmers
* To enable issuance of Kisan credit cards in 5 states
* NABARD to facilitate shrimp production financing, processing
* Financial support for nucleus breeding centre for shrimps

* Provision of 1.52 trln rupees for agriculture, allied sectors

* To provide support of 115 bln rupees for irrigation projects

INFRASTRUCTURE, INDUSTRY

* To formulate plan for all-round development of eastern states
* Gaya to be industrial node on Amritsar-Kolkata corridor
* Purvodaya to cover resource development, econ opportunities
* Gaya industrial node will be model for modern development
* Gaya industrial node will catalyse east region's industry
* To promote road connectivity projects such as Buxar-Bhagalpur
* To support Patna-Purnea Expressway project
* Additional two-lane bridge over Ganga at Buxar
* Bodh Gaya, Rajgir, Vaishali, Darbhanga road connectivity project
* To set up new airports, medical colleges, sports infra in Bihar
* Power projects worth 214 bln rupees to be set up
* 2,400 MW power plant to be set up at Peer Painthi

* Fully committed to financing of Polavaram project in Andhra
* Fully committed to Polavaram project's early completion

* Okayed 2.66 trln rupees for rural development, infrastructure

* To facilitate setting up of 100 food quality testing labs

* To set up e-commerce export hubs in PPP mode

* MSMEs to get support to set up 50 food irradiation units
* E-commerce export hubs for seamless trade, exports for MSMEs

* To set up investment-ready industrial parks in 100 cities
* Sanctioning 12 industrial parks under national corridor plan
* Set up industrial parks in collaboration with states, pvt cos
* To set up critical mineral mission

* Ownership, leasing reforms to improve shipping industry
* Launch auction of first tranche of offshore mining blocks
* Critical mineral mission to up local production, recycling
* Critical mineral mission to up overseas asset acquisition

* To develop cities as growth hubs with help of states
* Framework for creative redevelopment of cities soon
* Economic, transit plans through town-planning scheme for cities
* Transit-oriented development plan for 14 cities

* Plan policy document for energy transition

* PM Suryaghar Muft Bijli Yojana launched for 10 mln houses
* Solar panel scheme saw 12.8 mln registrations
* To promote power storage for renewable energy integration
* Nuclear energy to be key for energy mix under Viksit Bharat
* Pvt sector tie-up for Bharat Small Modular Nuclear reactor
* Completed advanced ultra-supercritical thermal power plant
* Moot fiscal support for NTPC-BHEL JV
* NTPC-BHEL JV to start 800-MW advanced ultra-thermal plant
* To give funds for clean energy measures in 100 clusters
* Moot invest-grade audit of traditional small, micro industry
* Govt capex to boost infra has had multiplier effect on economy
* Moot energy audit of small, micro industry in 60 clusters

* Endeavour to give fiscal support for infra over 5 years
* 1.5 trln rupees for long-term interest-free state loans
* To promote pvt investment in infra, provide framework soon
* To launch phase 4 of PM Gram Sadak Yojna

FINANCIAL SECTOR, MARKETS

* Formulated package for financing, regulatory changes for MSMEs
* Focus on MSMEs particularly mfg, services
* To set up credit guarantee scheme in mfg for MSMEs
* Formulated tech help package for MSMEs to compete globally
* To bring MSME credit guarantee scheme for collateral-free loan
* Self-financing guarantee fund to give 1 bln rupee loan to MSMEs
* New MSME guarantee plan to enable loans up to 1 bln rupees
* PSU banks to make internal assessment model for MSME credit
* PSU banks to avoid external assessment for giving MSME credit
* New mechanism to give bank loans to MSMEs during stressed time
* To up MUDRA loan limit to 2 mln rupees from 1 mln rupees
* MUDRA loan cap of 2 mln rupees for those repaid Tarun loans
* SIDBI to open new branches to serve MSME clusters
* Loans to MSMEs in stress to be counted under special mention acct
* Will bring 22 more PSUs, 7,000 cos on TREDS platform
* SIDBI to expand reach in MSME clusters within 3 years
* Plan integrated tech platform for improving outcome under IBC
* To develop digital public infra application
* Digital public infra for credit, e-commerce, MSMEs
* To extend scheme helping quicker voluntary closure of LLPs
* IBC has resolved 3.3 trln rupees worth of cases
* To have additional tribunals for IBC cases
* 28,000 cases involving 10 trln rupees disposed of under IBC
* IBC reforms to strengthen NCLT, NCLAT
* To set up additional debt recovery tribunals
* Some tribunals only for IBC cases under Companies Act
* To speed up changes in IBC, reforms of tribunals

* Earmarked significant amount for state capex loans
* To begin reforms on greater efficiency of markets, sectors

* To bring out financial sector vision document
* Moot document to set financial sector agenda for next 5 years
* Financial sector vision document to focus on financing needs
* Financial sector plan to set expectations for mkt participants
* To simplify FDI investment rules to promote rupee usage
* To start NPS Vatsalya plan for minors
* To seek legislative OK for flexible funding for leasing aircraft
* To seek legislative OK for flexible funding for leasing ships
* Parents, guardians to contribute under NPS Vatsalya plan

* NPS plan for minors can become normal on attaining 18 years

* Panel on new pension system has made considerable progress

STATES

* To expedite Bihar request for multilateral bank assistance

* Special financial support for Andhra via multilateral agencies
* Will provide 150 bln rupees to Andhra in FY25
* Will provide more financial support to Andhra in future
* Made efforts to expedite Andhra Pradesh Reorganisation Act
* Will provide more financial support to Andhra in future
* To provide grants for Rayalaseema, north coastal Andhra

* To undertake Kosi river-related flood mitigation projects
* Will provide assistance to Assam for flood management

* To give Himachal Pradesh aid for reconstruction from floods
* Uttarakhand to also get aid for landslides, floods
* Sikkim hit by flash floods last year, Centre to provide aid

* Moot comprehensive development initiative for Rajgir
* To support development of Nalanda, revive university
* To provide assistance for tourism development in Odisha

* Need states' support for faster implementation of reforms

* To incentivise states to implement business reform plan

MISCELLANEOUS

* To operationalise anusandhan research fund for basic research
* Aim to expand space economy five times in next 10 years

* 10 bln rupees venture capital fund to expand space economy

End

Compiled by Vinod Bhovad

Filed by Avishek Dutta

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