Union Budget 2022: Highlights

Finance Minister Nirmala Sitharaman has presented the 10th Union Budget of the Narendra Modi government in Parliament. This is the fourth budget presentation by FM Sitharaman.

Highlights-

  • FM expressed empathy with those who had to bear adverse health and economic effects of the COVID-19 Pandemic.
  • India’s economic growth in the current year is estimated to be 9.2%, the highest among all large economies.
  • Air India sale- Strategic transfer of ownership of Air India has been completed.
  • Aatmanirbhar Bharat- Aatmanirbhar Bharat has received an excellent response.
  • Public investment- Budget 2022 has provided a sharp increase in provision for public investment and capital expenditure.
  • This budget will provide the impetus for growth.
  • “We are in the midst of the Omicron wave, the speed of our vaccination campaign has helped greatly. I am confident that ‘Sabka Prayaas’, we’ll continue with strong growth”- FM Sitharaman
  • 400 Vande Bharat trains in the next three years. 400 new generation Vande Bharat trains with better efficiency to be brought in during the next 3 years; 100 PM Gati Shakti Cargo terminals to be developed during next 3 years and implementation of innovative ways for building metro systems.
  • “Budget 2022 seeks to lay the foundation to steer the economy over Amrit Kaal of next 25 years, from India at 75 to India at 100, continuing to build on the vision of Budget 2021” – FM
  • Production Linked Incentive (PLI) Scheme for achieving AatmaNirbhar Bharat has received an excellent response, with the potential to create 60 lakh new jobs and additional production of 30 lakh crore during next Keycap digit five years.
  • Four priorities of Budget 2022- “We lay the following four priorities – PM Gati Shakti, inclusive development, productivity enhancement, and investment, sunrise opportunities, energy transition and climate action & financing of investments.”- FM Nirmala Sitharaman
  • Procurement of wheat in Rabi season 2021-22 and the estimated procurement of paddy in Kharif season 2021-22 will give cover 1208 lakh metric tonnes of wheat & paddy from 163 lakh farmers& ₹2.37 lakh crores will be the direct payment of MSP value to their accounts.
  • PM Gati Shakti is driven by 7 engines: roads, railways, airports, ports, mass transport, waterways, and logistics infra. All 7 engines will pull forward the Economy in unison. Supported by energy transmission, IT communication, bulk water and sewerage, and social infra.
  • PM Gati Shakti Master Plan for Expressways to be formulated in 2022-23, to facilitate faster movement of people and goods. NH Motorway network to be expanded by 25,000 km in 2022-23. Rs. 20,000 crore to be mobilized to complement public resources.
  • Emergency Credit Line Guarantee Scheme (ECLGS) will be extended up to March 2023, the guaranteed cover will be expanded by ₹50,000 crores to a total cover of ₹5 lakh crores.
  • Chemical-free natural farming will be promoted throughout the country with a focus on farmers’ land in 5 km wide corridors along the river Ganga, in the first stage.
  • One Station One Product to be popularized to help local businesses and supply chains.
  • 60,000 crore allocated for providing access to tap water to 3.8 crore households.
  • PM Awas Yojna- In 2022-23, 80 lakh households will be identified for the affordable housing scheme. 80 lakh affordable houses will be completed at ₹44,000 cr under PM Awas Yojna in 2022-23.
  • Animation, visual effects, gaming, and the comics sector offers immense potential to employ youth. An AVGC promotion task force with all stakeholders will be set up to recommend ways to realize this and build domestic capacity for serving our markets and the global demand.
  • To facilitate domestic manufacturing of 280 gigawatts of installed solar capacity by 2030, an additional allocation of Rs 19,500 crore for PLI for manufacturing of high-efficiency modules with priority to fully integrate manufacturing units to solar PV modules will be made by the government.
  • ‘One class, one TV channel’ program of PM eVIDYA will be expanded from 12 to 200 TV channels. This will enable all states to provide supplementary education in regional languages for classes 1 to 12.
  • Issuance of e-passport will be rolled out in 2022-23 for the convenience of citizens in their overall travels. An E-passport with an embedded chip will be rolled out.
  • The pandemic has accentuated mental health problems in people of all ages. To better access to quality mental health counseling and care services, a National Tele Mental Health program will be launched.
  • 2,000 km of rail network to be brought under the indigenous world-class technology KAWACH, for safety and capacity augmentation.
  • To promote a shift to the use of public transport in urban areas special mobility zones with zero fossil fuel policy to be introduced. Considering space constraints in urban areas, a ‘Battery Swapping Policy’ will be brought in.
  • Special Economic Zones Act will be replaced with new legislation for the development of enterprises and hubs. It will cover the existing industrial enclaves and enhance the competitiveness of exports.
  • Villages on the northern border of India will be covered under a new vibrant village programme to enhance the development
  • Use of Kisan Drones to be promoted for crop assessment, digitization of land records, spraying of insecticides and nutrients.
  • Fund to be facilitated through NABARD to finance startups for agriculture and rural enterprise, relevant for farm produce value chain. Startups will support FPOs and provide tech to farmers.
  • A high-level panel to be set up for urban planning.
  • Finance Minister Nirmala Sitharaman proposed to set up a digital university to provide education that will be built on a hub and spoke model.
  • Modern building by-laws will be introduced.
  • 68% of the capital procurement budget for Defence to be earmarked for domestic industry to promote Aatmanirbharta and reduce dependence on imports of defence equipment. This is up from 58% last fiscal.
  • 5G spectrum auction to be conducted in 2022. India will auction 5G airwaves this year to facilitate a rollout of the next-generation telecoms service in 2022-23.
  • 5 existing academic institutions for urban planning to be designated as Centre for Excellence with an endowment fund of ₹250 cr.
  • Digital rupee to be issued using blockchain and other technologies and will be issued by RBI starting 2022-23. “This will give a big boost to the economy,” said the finance minister.
  • A completely paperless, e-bill system will be launched by ministries for procurement.
  • The outlay for CAPEX higher by 35% to ₹7.05 lakh cr for FY23.
  • Effective Capital Expenditure of the Central Govt is estimated at ₹10.68 lakh crores in 2022-23, about 4.1% of GDP.
  • Digital rupee to be issued using blockchain and other technologies; to be issued by RBI starting 2022-23. This will give a big boost to the economy.
  • All 1.5 lakh post offices in India will be connected to the core banking system that will enable people to access their accounts online and also transfer money within post office accounts and to other banks.
  • 4 pilot projects for coal gasification are to be set up.
  • Financial support will be provided to farmers to take up agro-forestry.
  • Risks of climate change are the strongest externalities for the world.
  • Fiscal deficit- Total expenditure is estimated at ₹39.45 lakh crore. Receipts are estimated at Rs22.84 lakh cr. FY’23 fiscal deficit target at 6.4% of GDP vs 6.9%.
  • Taxpayers can now file an updated return within 2 years. To provide an opportunity to correct an error, taxpayers can now file an updated return within 2 years from the relevant assessment year.
  • For 2022-23, allocation is ₹1 lakh cr to assist the states in catalyzing overall investments in the economy. These 50-yr interest-free loans are over and above normal borrowings allowed to states. It’ll be used for PM Gati Shakti-related&other productive capital investments of states.
  • Tax incentives for startups to be incorporated until March 31, 2023.
  • Income from transfer of digital assets to be taxed at 30%.
  • A TDS of 1% will be levied for transactions above a certain threshold.
  • Recipient to be taxed in case of gift of a virtual digital asset.
  • Loss from the transfer of virtual digital assets cannot be set off against any other income.
  • Propose to increase tax deduction limit to 14% on employers contribution to NPS account of state govt employees. Both Centre and States govt employees’ tax deduction limit to be increased from 10 percent to 14 percent to help the social security benefits of state govt employees and bring them at par with the Central government employees.
  • Corporate surcharge to be reduced from 12% to 7%.
  • Long-term capital gains on listed equity share units are subject to a maximum surcharge at 15%. Propose to cap transfer of long-term capital gains at 15%.
  • GST collection– The gross GST collections for January 2022 are ₹1,40,986 crores which is the highest since the inception of GST.
  • Import duty of 7.5% to be charged on capital goods.
  • A concessional corporate tax rate of 15% would be available for 1 more year till March 2024 for newly incorporated manufacturing companies.
  • States will be encouraged to adopt Unique Land Parcel Identification Number to facilitate IT-based management of land records.
  • Customs duty on cut & polished diamonds, gems to be reduced to 5%.
  • National Digital Health Ecosystem to be rolled out.
  • An international arbitration center will be set up at GIFT City to provide faster dispute resolution. In addition, a world-class university to be allowed in GIFT IFSC (International Financial Services Centre) free from domestic regulation.

List of items that will become cheaper and costlier in FY23-

CHEAPER

  • Clothes
  • Gemstones and diamonds
  • Imitation jewellery
  • Mobile phones
  • Mobile phone chargers
  • Custom duties on chemicals needed for petroleum products
  • Custom duties on certain chemicals, including methanol
  • Concessional customs duty on steel scrap extended for 1 year

COSTLIER

  • All imported items
  • Duty on umbrellas increased

Thank You for reading : )

Union Budget 2022: Highlights

Leave a Reply

Your email address will not be published.