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The Union Minister of Finance, Mrs. Sitharaman, presented the Union budget today based on vision of AatmaNirbhar Bharat (Self-Dependent India). Although its a huge list of things which are usually included in budget but this post is only focussed on few key points:
Health Sector Budget increased by 137%:
This is a massive step towards the betterment of health sector as almost all the countries have now realized its vitality and flaws, particularly during COVID times. Hence, this is seen as expected and a big step in this direction. This sector has always been ignored in terms of fund allocation so far, but this year 2,23,846 crore has been committed for its upgradation over the period of next 6 years.
Government of India has allocated 35,000 crore to the COVID vaccination program already, which would be the world’s biggest vaccination drive covering almost 1.3 billion residents of India.
Infrastructure Sector:
In an effort to boost infrastructure sector, 35% funding has been hiked straight away. A plan to establish a new Development Finance Institution (DFI) has been proposed with initial capital of $2.7 bn. This proposal has been put forward with an idea that this monetary institution would provide assistance to large scale infrastructure projects along with asset build-up to manage unpaid debts of existing banks to free up their lending capabilities. 100% electrification of railways by the 2023, Metro services in 27 cities and New highways in Kerala, Tamil Nadu, Assam and West Bengal are few of the other plans announced for infrastructural development.
Disinvestment Plans:
The government this year has put forward some major disinvestment plans in many public sectors such airlines, banking and insurance etc. This step has been looked upon as a major reform and but has also fetched some critical eyes. Around $23 billion disinvestment would be aimed in this year. Air India would be sold by the end of this financial year due to its long pending debts and LIC shares would be sold through IPO after the amendment of existing laws. Foreign direct Investment (FDI) for insurance sector has been raised from 49% to 74% to permit foreign ownership and controls with proper safeguarding measure. BPCL, Shipping Corporation of India, Container Corporation of India, IDBI Bank are some of the names which would be sold by the end of current financial year.
Source
Financial experts are welcoming these announcements and predicting a 11% rebound hike in Indian economy, mostly because of the reason that GDP is already navigating in the negative zone.
Other important features are:
- Encouragement to affordable housing by permitting extra reduction of interest ranging to 1.5 lakhs for affordable home mortgage.
- Exemptions for senior citizens availing only pensions and interest incomes to file IT returns but no change in IT slabs.
- Interest income from PF deductions exceeding 2.5 lakhs would be liable to be taxes.
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