New Delhi: Presenting the Union Budget for the year 2020-21, Finance Minister Nirmala Sitharaman, unveiled a series of reforms aimed at energising the Indian economy through a combination of short-term, medium-term, and long-term measures.
The Union Budget has been structured on the overall theme of "Ease of Living." This has been achieved by farmer-friendly initiatives such as agriculture credit target of Rs 15 lakh crore for 2020-21, schemes of "Kisan Rail" and "Krishi Udaan" for a seamless national cold supply chain for perishables, and expansion of PM-KUSUM to provide 20 lakh farmers for setting up stand-alone solar pumps.
In the health sector, the Budget proposes more than 20,000 empanelled hospitals under PM Jan Arogya Yojana for poor people, and expansion of Jan Aushadhi Kendra Scheme to all districts, offering 2,000 medicines and 300 surgicals by 2024.
Infrastructure received a boost, with 100 more airports by 2024 to support UDAN scheme; and operation of 150 passenger trains to be done through PPP mode.
The key highlights of Union Budget 2020-21 are as follows:
The Finance Minister said that more than Rs 2.83 lakh crore would be spent on agriculture, rural development, irrigation and allied activities as farmers and rural poor continue to remain the key focus of the government. Reiterating the commitment of doubling farmers' income by 2022, Sitharaman said, the government has already provided resilience for 6.11 crore farmers insured under PM Fasal Bima Yojana. Agriculture credit target for the year 2020-21 has be set at Rs 15 lakh crore. All eligible beneficiaries of PM-KISAN will be covered under the KCC scheme.
Referring to the theme of economic development, the Finance Minister said that Rs 27,300 crore would be allocated for the development and promotion of industry and commerce for the year 2020-21. An Investment Clearance Cell will be set up to provide "end-to-end" facilitation. It is proposed to develop five new smart cities in collaboration with states in PPP mode. A scheme to encourage manufacture of mobile phones, electronic equipment and semi-conductor packaging is also proposed.
In the infrastructure sector, Rs 100 lakh crore would be invested over the next five years. The National Infrastructure Pipeline, which was launched on December 31, 2019, proposed an investment of Rs 103 lakh crore to create infrastructure. It consists of more than 6,500 projects across sectors and are classified as per their size and stage of development. The Finance Minister said that about Rs 22,000 crore has already been provided as support to the Infrastructure Pipeline. Accelerated development of highways will be undertaken. This will include the development of 2,500 Km access control highways, 9,000 Km of economic corridors, 2,000 Km of coastal and land port roads and 2,000 Km of strategic highways. Delhi-Mumbai Expressway and two other packages to be completed by 2023. Chennai-Bengaluru Expressway will also be started. It is proposed to monetise at least 12 lots of highway bundles of over 6,000 Km before 2024.
Indian Railways aims to achieve electrification of 27,000 Km of tracks. She said that within 100 days of assumption of this government, it has commissioned 550 WiFi facilities in as many stations. Four station re-development projects and operation of 150 passenger trains would be done through PPP mode. The process of inviting private participation is underway. More Tejas type trains will connect iconic tourist destinations. High speed train between Mumbai to Ahmedabad would be actively pursued. Similarly, 100 more airports would be developed by 2024 to support UDAN scheme. Air fleet number expected to go up from the present 600 to 1,200 during this time. Allocation of Rs 1.70 lakh crore proposed for transport infrastructure in 2020-21. Similarly, allocation of Rs 22,000 crore proposed for power and renewable energy sector in 2020-21. Expansion of the national gas grid from the present 16,200 km to 27,000 km proposed.
On New Economy, Sitharaman said that a policy to enable the private sector to build Data Centre parks throughout the country will be brought out soon. Fibre to the Home (FTTH) connections through Bharatnet will link 100,000-gram panchayats this year. It is proposed to provide Rs 6000 crore to Bharatnet programme in 2020-21.
The Finance Minister said that in the last few years, the government has infused about Rs 3,50,000 crore by way of capital into Public Sector Banks for regulatory and growth purposes. Governance reforms would be carried out in these banks, so that they become more competitive. The government has already approved the consolidation of 10 banks into four. Further, the Deposit Insurance and Credit Guarantee Corporation (DICGC) has been permitted to increase Deposit Insurance Coverage for a depositor, which is now Rs 1 lakh to Rs 5 lakh per depositor. The limit for NBFCs to be eligible for debt recovery under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act 2002 is proposed to be reduced from Rs 500 crore to asset size of Rs 100 crore or loan size from existing Rs 1 crore to Rs 50 lakh.
To meet the need for greater private capital, it is proposed to sell the balance holding of the Government in IDBI Bank to private, retail and institutional investors through the stock exchange. To help easy mobility while in jobs, we wish to infuse capital into the Universal Pension coverage with auto-enrolment. More than five lakh MSMEs have benefitted from the restructuring of debt permitted by the RBI in the last year. The restructuring window was to end on March 31, 2020. The government has asked RBI to consider extending this window till March 31, 2021. For selected sectors such as pharmaceuticals, auto components and others, it is proposed to extend handholding support – for technology upgradations, R&D, business strategy etc. A scheme of Rs 1,000 crore will be anchored by EXIM Bank together with SIDBI.