Tag: interim budget

The interim Budget — the other numbers

Much has been written about the interim budget. About the expenditure in 2024-25 at ₹47,65,768 crore estimated to be 6% higher than the revised estimate; the receipts at ₹30,80,274 being 12% higher than the revised estimate; the tax revenue is also expected to increase by 12% with indirect taxes projected to record a robust 9.4% growth and corporate taxes collections also expected to accelerate.

Discussions have also centred around the nominal GDP growth of 10.5% estimated in 2024-25 and the revenue deficit being targeted at 2% of the GDP with fiscal deficit estimated to be 5.1 percent of GDP. All this despite there being no change in the tax rates and certain direct tax benefits being extended (for startups, sovereign wealth funds, some IFSC units) by another year. The disinvestment process continued to disappoint, and the disinvestment target has been reduced (for the fourth consecutive year) to ₹50,000 crore from the target of ₹61,000. Expenditure on subsidies at ₹4,09,723 crore is lesser by 7%. The Centre’s capex spending is expected to increase to ₹11.1 lakh crore from ₹9.5 lakh crore. This will result in the capital expenditure increasing to 3.4% of the GDP from the earlier revised estimate of 3.2%.

There has been an increase in allocation of specific sectors (pharma, MEITY, food processing, automobiles/auto components) in the production-linked incentive scheme and focus on promotion of tourism.

What has not been discussed sufficiently are some more interesting numbers in the receipts budget. It may be recalled that the USP of GST was that cesses will be subsumed. This is because cess, which is collected under the powers vested with the Central government in terms of Article 270 of the Constitution, is money which is not shared with the states — it does not form part of the divisible pool. This was and is a grave matter of concern for the states. Both the 14th Finance Commission and the 15th Finance Commission have commented adversely about this trend.

However, It would appear that the cess continues to be a major source of revenue for the Central government. Health and education cess both on corporation tax and income tax amounting to ₹78,000 crore have been collected as per the revised budget 2023-24. The cess amount budgeted for 2024-25 from these two taxes is ₹83,000 crore.

On the customs side, social welfare surcharge, health cess and agriculture infrastructure and development cess and cess from exports have as per the revised budget 2023-24 contributed ₹43,400 crore with the budgeted amount from these cesses for 2024-25 being ₹44,280 crore. On the central excise side cess from crude oil, agriculture infrastructure and development cess, road and infrastructure cess contributed as per the revised budget 2023-24 ₹1,16,100 crore with the budgeted amount from these cesses for 2024-25 being ₹5800 crore more at ₹1,21,900.

Thus, a total of ₹2,37,500 crore has been the contribution from cesses as per the revised budget 2023-24, with ₹2,49,180 crore being projected as collections from cesses in 2024-25. This is not a small amount and to this extent the states get lesser.

The other disturbing data is at Annex-5 of the receipts budget. This is the tax revenues raised but not realised at the end of the reporting year 2022-2023.

The total of the amounts under dispute between corporation tax, income tax, central goods & services tax (CGST), customs, union excise and service tax are a mind boggling ₹12,21,976.41 crore. The amounts not under dispute, implying thereby that all appeals if any are over and this is revenue due to the government, is ₹9,08,430.67 crore. There are cases above 10 years in this category where the total amount due is ₹1,42,657.07 crore.

A note beneath the table in Annex-5 states that the ‘prominent reason for Tax Revenue raised but not realized in amount not under dispute category are no assets or inadequate assets for recovery, assesses not traceable etc.’ The grand total of the entire tax revenues raised but not realized is a humongous Rs.21,30,407.08 crore. This is substantial potential revenue for a government which needs all the revenue for the developmental work it would like to do. It should not be forgotten that the outstanding liabilities of the Centre are estimated to be about 57 percent of GDP. The interest payments would be around 40 percent of the revenue receipts. Every penny is thus required.

It is incumbent that dedicated teams be created to trace the defaulters and all efforts taken to realize the amounts. As regards the amounts under dispute and pending for periods above 10 years a review of all such cases needs to be done-and where the case does not merit pursuing to withdraw them/drop them and where indeed there is a problem as indicated in the note then to take steps to write-off the amounts ;the effort should be to recover and if not to get rid of the pendency by writing off the amount.

The interim budget had a proposal to withdraw all outstanding disputed direct tax demand up to ₹.25,000. A review should be done of the impact of this on the arrears and the scheme extended to larger amounts which are not recoverable.

Another interesting detail is at 5.01.01.02 of the receipts budget. This is the detail of the customs revenue generated through debit in ledger due to various scrip-based schemes. The amount is ₹37,236.71 crore. The point to be noted is that actual revenue is not received by the government in such cases; the revenue is ‘received’ as debits of scrips.

As the footnote to the receipts budget at 5.01.01.02 explains, “The duty credit schemes provide to an exporter, certain credit amount, which can be utilised for payment of basic custom duty. The duty credit is allowed inter-alia to reimburse taxes/duties/levies suffered on exported goods. The scrips are credited in an exporter’s ledger account maintained at custom EDI”

Very many of the schemes which reward exporters are dangerously close to being WTO non-compliant. Most of them have been phased out — the debits are of scrips issued for exports done in the past. The government would do well to focus only on schemes like rebate on state and central taxes and levies (RoSCTL) scheme, remission of duties and taxes on exported products (RoDTEP) or drawback of duties. These schemes only return to the exporters duties of taxes paid by them on various inputs which have gone in the manufacturer of goods which are being exported-they are not subsidies or rewards.

These are areas of concern- however overall consensus is that the Government has shown restraint and rectitude, despite this being a pre-poll budget.

 

—The author, Najib Shah, is former Chairman, Central Board of Indirect Taxes & Customs. The views expressed are personal.

 

Read his previous articles here

Budget 2024: NK Singh says fiscal deficit target ‘daunting’, signals commitment to macro stability

In her Budget 2024 address on February 1, Finance Minister Nirmala Sitharaman outlined the government’s fiscal deficit target of 5.1% in the upcoming fiscal year (FY25). This goal aligns with a broader fiscal consolidation strategy aimed at bringing the deficit down to below 4.5% by FY26, Sitharaman said.

Fiscal deficit for the current financial year (FY24) is expected to be 5.8%, lower than the 5.9% budgeted estimate.

According to NK Singh, Chairperson of the 15th Finance Commission, the 0.7% expected fiscal consolidation is a “fairly daunting target’ in absolute terms.

Also Read | Budget 2024: FM Sitharaman delivers her shortest budget speech at 57 Minutes

“It’s a clear signal on the government’s continued commitment to a path of macroeconomic stability, and fiscal consolidation, and I have no doubt that the debt numbers will also show this kind of fiscal resolve and look in a southward direction,” he told CNBC-TV18 discussing his key takeaways from the six budget by FM Sitharaman.

This fiscal resolve, Singh noted, is very important as a signal to investors and rating agencies on India’s continued adherence to its goals even in an election year.

Singh also referred to Finance Minister Nirmala Sitharaman‘s emphasis on Trust, Confidence, and the Blessings.

Also Read | Budget 2024 key highlights: Capex hike, Ayushman Bharat inclusions, EV ecosystem expansion to no tax changes

He discussed a notable shift in the states’ approach to fiscal management pointing out that states have purposefully utilised funds, with expenditure patterns showing a switch towards long-term multiplier growth.

Singh lauded this as a decisive move towards “Viksit Bharat,” emphasising the states’ crucial role in contributing to the nation’s long-term growth story.

For more, watch the accompanying video

Budget 2024: FM Sitharaman lowers fertiliser subsidy allocation by 13% to ₹1.64 crore for FY24-25

Finance Minister Nirmala Sitharaman has lowered the allocation for fertiliser subsidy by 13.2% to ₹1.64 lakh crore for 2024–25 in the interim budget compared to ₹1.89 lakh crore revised budget estimate for FY24. The allocation for fertiliser subsidy for FY24 was budgeted at ₹1.75 lakh crore.

CNBC-TV18 had earlier reported that the government’s fertiliser subsidy for this year is pegged at around ₹1.88 lakh crore, with the government seeking an additional amount of ₹13,350 crore in cash for fertiliser subsidy in early December. Overall, the FM sought Parliament’s approval to spend an additional ₹58,000 crore in cash in FY24 through the Supplementary Demands for Grants during the winter session.

Fertiliser Subsidy (in ₹ crore)	FY23	FY24	FY25	YoY
Urea Subsidy	1,65,217	1,28,594	1,19,000	-7.5
Domestic	1,25,270	1,02,121	1,00,340	-1.7
Imported	43,407	30,000	22,634	-24.6
Nutrient Based Subsidy	86,122	60,300	45,000	-25.4
Domestic	50,090	32,370	26,500	-18.1
Imported	36,033	27,930	18,500	-33.8
Total Fertiliser Subsidy	2,51,339	1,88,894	1,64,000	-13.2

The Centre gives subsidy on urea and nutrient-based subsidy on other fertilisers. The drop in subsidy in FY25 is being seen against the backdrop of a drop in international prices, a push for bio- and organic fertilisers and the increased use of nano-urea.

Urea constitutes 55–60% of India’s total fertiliser consumption and is met through both imports and local production. A bag of subsidised urea to farmers costs ₹242 per 45-kg bag, excluding taxes and neem coating charges, but the actual cost of the bag is around ₹2,200.

Against the original budget estimate of over ₹1 lakh crore, the government has ended up giving fertiliser subsidies of ₹2.25 lakh crore, amid the ongoing Russia-Ukraine war that impacted global supply chains. Within the overall fertiliser subsidy in FY23, the government has spent ₹63,222 crore on urea and ₹42,000 crore on nutrient-based subsidy.

While input costs softened towards year-end last year, the overall consumption of fertiliser remains high in India, keeping subsidy outgo high.

Track all the latest updates on FM Sitharaman’s budget speech and other top developments of the day with CNBC-TV18’s live blog

PM Modi hails Budget 2024, says it guarantees of making India a developed nation by 2047

Prime Minister Narendra Modi on Thursday, February 1, hailed the interim Budget presented by Finance Minister Nirmala Sitharaman by calling it “inclusive and innovative”. He said the Budget has a “reflection of the young aspirations of a young India”.

“This interim budget is inclusive and innovative. It has confidence of continuity. It will empower all four pillars of Viksit Bharat- Yuva (youth), Garib (poor), Mahila (women) and Kisan (farmer). This Budget gives the guarantee of making India a developed nation by 2047,” Modi said.

Modi said the Budget stresses on empowerment of the poor and the middle class and creating of new employment opportunities for them. He added that the income-tax remission scheme will provide relief to 1 crore people from the middle class.

“This budget has a reflection of the young aspirations of a young India. Two important decisions were made within the Budget. For research and innovation, a fund of ₹1 lakh crore has been announced,” Modi added.

Union Home Minister Amit Shah said Budget draws a roadmap to achieve PM Modi’s vision of a developed Bharat by 2047.

Sitharaman, India’s first full-time woman Finance Minister, was appointed in 2019. She presented her maiden Budget on July 5, 2019. The Budget for 2024-25 is Sitharaman’s sixth straight Budget. Her Budget for the fiscal beginning April 2024 (FY2024-24) is the Modi government’s 12th straight Budget since 2014 (including one interim Budget presented ahead of general elections in 2019).

Budget 2024: Full text of Finance Minister Nirmala Sitharaman’s speech

Budget 2024 Nirmala Sitharaman Speech

Hon’ble Speaker,

I present the Interim Budget for 2024-25.

Introduction

The Indian economy has witnessed profound positive transformation in the last ten years. The people of India are looking ahead to the future with hope and optimism.

With the blessings of the people, when our Government under the visionary and dynamic leadership of Hon’ble Prime Minister Shri Narendra Modi assumed office in 2014, the country was facing enormous challenges. With ‘Sabka Saath, Sabka Vikas’ as its ‘mantra’, the Government overcame those challenges in right earnest. Structural reforms were undertaken. Pro-people programmes were formulated and implemented promptly. Conditions were created for more opportunities for employment and entrepreneurship. The economy got a new vigour. The fruits of development started reaching the people at scale. The country got a new sense of purpose and hope. Naturally, the people blessed the Government with a bigger mandate.

In the second term, our Government under the leadership of Hon’ble Prime Minister doubled down on its responsibilities to build a prosperous country with comprehensive development of all people and all regions. Our Government strengthened its ‘mantra’ to ‘Sabka Saath, Sabka Vikas, and Sabka Vishwas’. Our development philosophy covered all elements of inclusivity, namely, social inclusivity through coverage of all strata of the society, and geographical inclusivity through development of all regions of the country.

With the ‘whole of nation’ approach of ‘Sabka Prayas’, the country overcame the challenge of a once-in-a-century pandemic, took long strides towards ‘Atmanirbhar Bharat’, committed to ‘Panch Pran’, and laid solid foundations for the ‘Amrit Kaal’. As a result, our young country has high aspirations, pride in its present, and hope and confidence for a bright future. We expect that our Government, based on its stupendous work, will be blessed again by the people with a resounding mandate.

Inclusive Development and Growth

Our humane and inclusive approach to development is a marked and deliberate departure from the earlier approach of ‘provisioning up-to-village level’. Development programmes, in the last ten years, have targeted each and every household and individual, through ‘housing for all’, ‘har ghar jal’, electricity for all, cooking gas for all, bank accounts and financial services for all, in record time.

The worries about food have been eliminated through free ration for 80 crore people. Minimum support prices for the produce of ‘Annadata’ are periodically increased appropriately. These and the provision of basic necessities have enhanced real income in the rural areas. Their economic needs could be addressed, thus spurring growth and generating jobs.

Our Government is working with an approach to development that is all-round, all-pervasive and all-inclusive  (sarvangin, sarvasparshi and sarvasamaveshi). It covers all castes and people at all levels. We are working to make India a ‘Viksit Bharat’ by 2047. For achieving that goal, we need to improve people’s capability and empower them.

Previously, social justice was mostly a political slogan. For our Government, social justice is an effective and necessary governance model. The saturation approach of covering all eligible people is the true and comprehensive achievement of social justice. This is secularism in action, reduces corruption, and prevents nepotism (bhai-bhateejavaad). There is transparency and assurance that benefits are delivered to all eligible people. The resources are distributed fairly. All, regardless of their social standing, get access to opportunities. We are addressing systemic inequalities that had plagued our society. We focus on outcomes and not on outlays so that the socio-economic transformation is achieved.

As our Prime Minister firmly believes, we need to focus on four major castes. They are, ‘Garib’ (Poor), ‘Mahilayen’ (Women), ‘Yuva’ (Youth) and ‘Annadata’ (Farmer). Their needs, their aspirations, and their welfare are our highest priority. The country progresses, when they progress. All four require and receive government support in their quest to better their lives. Their empowerment and well-being will drive the country forward.

Garib Kalyan

We believe in empowering the poor. The earlier approach of tackling poverty through entitlements had resulted in very modest outcomes. When the poor become empowered partners in the development process, government’s power to assist them also increases manifold. With the pursuit of ‘Sabka ka Saath’ in these 10 years, the Government has assisted 25 crore people to get freedom from multi-dimensional poverty. Our Government’s efforts are now getting synergized with energy and passion of such empowered people. This is truly elevating them from poverty.

‘Direct Benefit Transfer’ of ₹34 lakh crore from the Government using PM-Jan Dhan accounts has led to savings of  ₹2.7 lakh crore for the Government. This has been realized through avoidance of leakages prevalent earlier. The savings have helped in providing more funds for ‘Garib Kalyan’.

PM-SVANidhi has provided credit assistance to 78 lakh street vendors. From that total, 2.3 lakh have received credit for the third time.

PM-JANMAN Yojana reaches out to the particularly vulnerable tribal groups, who have remained outside the realm of development so far. PM-Vishwakarma Yojana provides end-to-end support to artisans and craftspeople engaged in 18 trades. The schemes for empowerment of Divyangs and Transgender persons reflect firm resolve of our Government to leave no one behind.

Farmer Welfare

Farmers are our ‘Annadata’. Every year, under PM-KISAN SAMMAN Yojana, direct financial assistance is provided to 
11.8 crore farmers, including marginal and small farmers. Crop insurance is given to 4 crore farmers under PM Fasal Bima Yojana. These, besides several other programmes, are assisting ‘Annadata’ in producing food for the country and the world.

Electronic National Agriculture Market has integrated 1,361 mandis, and is providing services to 1.8 crore farmers with trading volume of ₹3 lakh crore.

The sector is poised for inclusive, balanced, higher growth and productivity. These are facilitated from farmer-centric policies, income support, coverage of risks through price and insurance support, promotion of technologies and innovations through start-ups.

Empowering Amrit Peedhi, the Yuva

Our prosperity depends on adequately equipping and empowering the youth. The National Education Policy 2020 is ushering in transformational reforms. PM Schools for Rising India (PM SHRI) are delivering quality teaching, and nurturing holistic and well-rounded individuals.

The Skill India Mission has trained 1.4 crore youth, upskilled and reskilled 54 lakh youth, and established 3,000 new ITIs. A large number of new institutions of higher learning, namely 7 IITs, 16 IIITs, 7 IIMs, 15 AIIMS and 390 universities have been set up.

PM Mudra Yojana has sanctioned 43 crore loans aggregating to ₹22.5 lakh crore for entrepreneurial aspirations of our youth. Besides that, Fund of Funds, Start Up India, and Start Up Credit Guarantee schemes are assisting our youth. They are also becoming ‘rozgardata’.

The country is proud of our youth scaling new heights in sports. The highest ever medal tally in Asian Games and Asian Para Games in 2023 reflects a high confidence level. Chess prodigy and our Number-One ranked player Praggnanandhaa put up a stiff fight against the reigning World Champion Magnus Carlsson in 2023. Today, India has over 80 chess grandmasters compared to little over 20 in 2010.

Momentum for Nari Shakti

The empowerment of women through entrepreneurship, ease of living, and dignity for them has gained momentum in these ten years.

Thirty crore Mudra Yojana loans have been given to women entrepreneurs. Female enrolment in higher education has gone up by 28% in ten years. In STEM courses, girls and women constitute 43% of enrolment – one of the highest in the world. All these measures are getting reflected in the increasing participation of women in workforce.

Making ‘Triple Talaq’ illegal, reservation of one-third seats for women in the Lok Sabha and State legislative assemblies, and giving over 70% houses under PM Awas Yojana in rural areas to women as sole or joint owners have enhanced their dignity.

Exemplary Track Record of Governance, Development and Performance (GDP)

Besides delivering on high growth in terms of Gross Domestic Product, the Government is equally focused on a more comprehensive ‘GDP’, i.e., ‘Governance, Development and Performance’.

Our Government has provided transparent, accountable, people-centric and prompt trust-based administration with ‘citizen-first’ and ‘minimum government, maximum governance’ approach.

The impact of all-round development is discernible in all sectors. There is macro-economic stability, including in the external sector. Investments are robust. The economy is doing well.

People are living better and earning better, with even greater aspirations for the future. Average real income of the people has increased by 50%. Inflation is moderate. People are getting empowered, equipped and enabled to pursue their aspirations. There is effective and timely delivery of programmes and of large projects.

Economic Management

The multipronged economic management over the past ten years has complemented people-centric inclusive development. Following are some of the major elements.

All forms of infrastructure, physical, digital or social, are being built in record time.

All parts of the country are becoming active participants in economic growth.

Digital Public Infrastructure, a new ‘factor of production’ in the 21st century, is instrumental in formalization of the economy.

Goods and Services Tax has enabled ‘One Nation, One Market, One Tax’. Tax reforms have led to deepening and widening of tax base.

Strengthening of the financial sector has helped in making savings, credit and investments more efficient.

GIFT IFSC and the unified regulatory authority, IFSCA are creating a robust gateway for global capital and financial services for the economy.

Proactive inflation management has helped keep inflation within the policy band.

Global Context

Geopolitically, global affairs are becoming more complex and challenging with wars and conflicts. Globalization is being redefined with reshoring and friend-shoring, disruption and fragmentation of supply chains, and competition for critical minerals and technologies. A new world order is emerging after the Covid pandemic.

India assumed the G20 Presidency during very difficult times for the world. The global economy was going through high inflation, high interest rates, low growth, very high public debt, low trade growth, and climate challenges. The pandemic had led to a crisis of food, fertilizer, fuel and finances for the world, while India successfully navigated its way. The country showed the way forward and built consensus on solutions for those global problems.

The recently announced India-Middle East-Europe Economic Corridor is a strategic and economic game changer for India and others. In the words of Hon’ble Prime Minister, the corridor “will become the basis of world trade for hundreds of years to come, and history will remember that this corridor was initiated on Indian soil”.

Vision for ‘Viksit Bharat’

Our vision for ‘Viksit Bharat’ is that of “Prosperous Bharat in harmony with nature, with modern infrastructure, and providing opportunities for all citizens and all regions to reach their potential”.

With confidence arising from strong and exemplary track-record of performance and progress earning ‘Sabka Vishwas’, the next five years will be years of unprecedented development, and golden moments to realize the dream of developed India @ 2047. The trinity of demography, democracy and diversity backed by ‘Sabka Prayas’ has the potential to fulfill aspirations of every Indian.

As Hon’ble Prime Minister in his Independence Day address to the nation mentioned, “There is no dearth of opportunities; as many opportunities as we want. The country is capable of creating more opportunities. Sky’s the limit”.

‘Amrit Kaal’ Strategy

Our Government will adopt economic policies that foster and sustain growth, facilitate inclusive and sustainable development, improve productivity, create opportunities for all, help them enhance their capabilities, and contribute to generation of resources to power investments and fulfill aspirations.

Guided by the principle ‘Reform, Perform, and Transform’, the Government will take up next generation reforms, and build consensus with the states and stakeholders for effective implementation.

It is an important policy priority for our Government to ensure timely and adequate finances, relevant technologies and appropriate training for the Micro, Small and Medium Enterprises (MSME) to grow and also compete globally. Orienting the regulatory environment to facilitate their growth will be an important element of this policy mix.

Aligning with the ‘Panchamrit’ goals, our Government will facilitate sustaining high and more resource-efficient economic growth. This will work towards energy security in terms of availability, accessibility and affordability.

For meeting the investment needs our Government will prepare the financial sector in terms of size, capacity, skills and regulatory framework.

Aspirational Districts Programme

Our Government stands ready to assist the states in faster development of aspirational districts and blocks, including generation of ample economic opportunities.

Our Government will pay utmost attention to make the eastern region and its people a powerful driver of India’s growth.

PM Awas Yojana (Rural)

Despite the challenges due to COVID, implementation of PM Awas Yojana (Grameen) continued and we are close to achieving the target of three crore houses. Two crore more houses will be taken up in the next five years to meet the requirement arising from increase in the number of families.

Rooftop solarization and free electricity

Through rooftop solarization, one crore households will be enabled to obtain up to 300 units free electricity every month. This scheme follows the resolve of Hon’ble Prime Minister on the historic day of consecration of Ram Mandir in Ayodhya. Following benefits are expected.

Savings up to fifteen to eighteen thousand rupees annually for households from free solar electricity and selling the surplus to the distribution companies; Charging of electric vehicles; Entrepreneurship opportunities for a large number of vendors for supply and installation; Employment opportunities for the youth with technical skills in manufacturing, installation and maintenance;

Housing for middle class

Our Government will launch a scheme to help deserving sections of the middle class “living in rented houses, or slums, or chawls and unauthorized colonies” to buy or build their own houses.

Healthcare and medical colleges

Several youth are ambitious to get qualified as doctors. They aim to serve our people through improved healthcare services. Our Government plans to set up more medical colleges by utilizing the existing hospital infrastructure under various departments. A committee for this purpose will be set-up to examine the issues and make relevant recommendations.

Our Government will encourage vaccination for girls in age group of 9 to 14 years for prevention of cervical cancer.

Various schemes for maternal and child care will be brought under one comprehensive programme for synergy in implementation. Upgradation of anganwadi centres under “Saksham Anganwadi and Poshan 2.0” will be expedited for improved nutrition delivery, early childhood care and development.

The newly designed U-WIN platform for managing immunization and intensified efforts of Mission Indradhanush will be rolled out expeditiously throughout the country.

Healthcare cover under Ayushman Bharat scheme will be extended to all ASHA workers, Anganwadi Workers and Helpers.

Agriculture and food processing

The efforts for value addition in agricultural sector and boosting farmers’ income will be stepped up. Pradhan Mantri Kisan Sampada Yojana has benefitted 38 lakh farmers and generated 10 lakh employment. Pradhan Mantri Formalisation of Micro Food Processing Enterprises Yojana has assisted 2.4 lakh SHGs and sixty thousand individuals with credit linkages. Other schemes are complementing the efforts for reducing post-harvest losses, and improving productivity and incomes.

For ensuring faster growth of the sector, our Government will further promote private and public investment in
post-harvest activities including aggregation, modern storage, efficient supply chains, primary and secondary processing and marketing and branding.

After the successful adoption of Nano Urea, application of Nano DAP on various crops will be expanded in all agro-climatic zones.

Building on the initiative announced in 2022, a strategy will be formulated to achieve ‘atmanirbharta’ for oil seeds such as mustard, groundnut, sesame, soybean, and sunflower. This will cover research for high-yielding varieties, widespread adoption of modern farming techniques, market linkages, procurement, value addition, and crop insurance.

Dairy Development

A comprehensive programme for supporting dairy farmers will be formulated. Efforts are already on to control foot and mouth disease. India is the world’s largest milk producer but with low productivity of milch-animals. The programme will be built on the success of existing schemes such Rashtriya Gokul Mission, National Livestock Mission, and Infrastructure Development Funds for dairy processing and animal husbandry.

Matsya Sampada

It was our Government which set up a separate Department for Fisheries realizing the importance of assisting fishermen. This has resulted in doubling of both inland and aquaculture production. Seafood export since 2013-14 has also doubled. Implementation of Pradhan Mantri Matsya Sampada Yojana (PMMSY) will be stepped up to enhance aquaculture productivity from existing 3 to
5 tons per hectare,
double exports to ₹1 lakh crore and generate 55 lakh employment opportunities in near future.

Five integrated aquaparks will be setup.

Lakhpati Didi

83 lakh SHGs with nine crore women are transforming rural socio-economic landscape with empowerment and self-reliance. Their success has assisted nearly one crore women to become Lakhpati Didi already. They are an inspiration to others. Their achievements will be recognized through honouring them. Buoyed by the success, it has been decided to enhance the target for Lakhpati Didi from 2 crore to 3 crore.

Technological changes

New age technologies and data are changing the lives of people and businesses. They are also enabling new economic opportunities and facilitating provision of high-quality services at affordable prices for all, including those at ‘bottom of the pyramid’. Opportunities for India at the global level are expanding. India is showing solutions through innovation and entrepreneurship of its people.

Research and Innovation 

Prime Minister Shastri gave the slogan of “Jai Jawan Jai Kisan”. Prime Minister Vajpayee made that “Jai Jawan Jai Kisan Jai Vigyan”. Prime Minister Modi has furthered that to “Jai Jawan Jai Kisan Jai Vigyan and Jai Anusandhan”, as innovation is the foundation of development.

For our tech savvy youth, this will be a golden era. A corpus of rupees one lakh crore will be established with fifty-year interest free loan. The corpus will provide long-term financing or refinancing with long tenors and low or nil interest rates. This will encourage the private sector to scale up research and innovation significantly in sunrise domains. We need to have programmes that combine the powers of our youth and technology.

A new scheme will be launched for strengthening deep-tech technologies for defence purposes and expediting ‘atmanirbharta’.

Infrastructure Development

Building on the massive tripling of the capital expenditure outlay in the past 4 years resulting in huge multiplier impact on economic growth and employment creation, the outlay for the next year is being increased by 11.1% to eleven lakh, eleven thousand, one hundred and eleven crore rupees (₹11,11,111 crore). This would be 3.4% of the GDP.

Railways

Three major economic railway corridor programmes will be implemented. These are: energy, mineral and cement corridors, port connectivity corridors, and high traffic density corridors.

The projects have been identified under the PM Gati Shakti for enabling multi-modal connectivity. They will improve logistics efficiency and reduce cost.

The resultant decongestion of the high-traffic corridors will also help in improving operations of passenger trains, resulting in safety and higher travel speed for passengers. Together with dedicated freight corridors, these three economic corridor programmes will accelerate our GDP growth and reduce logistic costs.

Forty thousand normal rail bogies will be converted to the Vande Bharat standards to enhance safety, convenience and comfort of passengers.

Aviation Sector

The aviation sector has been galvanized in the past 10 years. Number of airports have doubled to 149. Roll out of air connectivity to tier-two and tier-three cities under UDAN scheme has been widespread. Five hundred and seventeen new routes are carrying 1.3 crore passengers. Indian carriers have pro-actively placed orders for over 1,000 new aircrafts. Expansion of existing airports and development of new airports will continue expeditiously.

Metro and NaMo Bharat

We have a fast-expanding middle class and rapid urbanization is taking place. Metro Rail and NaMo Bharat can be the catalyst for the required urban transformation. Expansion of these systems will be supported in large cities focusing on transit-oriented development.

Green Energy

Towards meeting our commitment for ‘net-zero’ by 2070, the following measures will be taken.

Viability gap funding will be provided for harnessing offshore wind energy potential for initial capacity of one giga-watt.

Coal gasification and liquefaction capacity of 100 MT will be set up by 2030. This will also help in reducing imports of natural gas, methanol, and ammonia.

Phased mandatory blending of compressed biogas (CBG) in compressed natural gas (CNG) for transport and piped natural gas (PNG) for domestic purposes will be mandated.

Financial assistance will be provided for procurement of biomass aggregation machinery to support collection.

Our Government will expand and strengthen the e-vehicle ecosystem by supporting manufacturing and charging infrastructure. Greater adoption of e-buses for public transport networks will be encouraged through payment security mechanism.

For promoting green growth, a new scheme of bio-manufacturing and bio-foundry will be launched. This will provide environment friendly alternatives such as biodegradable polymers, bio-plastics, bio-pharmaceuticals and bio-agri-inputs. This scheme will also help in transforming today’s consumptive manufacturing paradigm to the one based on regenerative principles.

For promoting climate resilient activities for blue economy 2.0, a scheme for restoration and adaptation measures, and coastal aquaculture and mariculture with integrated and multi-sectoral approach will be launched.

Tourist centres comprehensive development

The success of organizing G20 meetings in sixty places presented diversity of India to global audience. Our economic strength has made the country an attractive destination for business and conference tourism. Our middle class also now aspires to travel and explore. Tourism, including spiritual tourism, has tremendous opportunities for local entrepreneurship.

States will be encouraged to take up comprehensive development of iconic tourist centres, branding and marketing them at global scale. A framework for rating of the centres based on quality of facilities and services will be established. Long-term interest free loans will be provided to States for financing such development on matching basis.

To address the emerging fervour for domestic tourism, projects for port connectivity, tourism infrastructure, and amenities will be taken up on our islands, including Lakshadweep. This will help in generating employment also.

Promoting Investments

The FDI inflow during 2014-23 was $596 billion marking a golden era. That is twice the inflow during 2005-14. For encouraging sustained foreign investment, we are negotiating bilateral investment treaties with our foreign partners, in the spirit of ‘first develop India’.

‘Viksit Bharat’

Many growth and development enabling reforms are needed in the states for realizing the vision of ‘Viksit Bharat’. A provision of seventy-five thousand crore rupees as 50-year interest free loan is proposed this year to support those milestone-linked reforms by the State Governments.

Societal Changes

The Government will form a high-powered committee for an extensive consideration of the challenges arising from fast population growth and demographic changes. The committee will be mandated to make recommendations for addressing these challenges comprehensively in relation to the goal of ‘Viksit Bharat’.

Our Government stands committed to strengthening and expanding the economy with high growth and to create conditions for people to realize their aspirations. Hon’ble Prime Minister in his Independence Day address to the nation, in the 75th year of our Republic said; we “commit ourselves to national development, with new inspirations, new consciousness, new resolutions, as the country opens up immense possibilities and opportunities”. It is our ‘Kartavya Kaal’.

Every challenge of the pre-2014 era was overcome through our economic management and our governance. These have placed the country on a resolute path of sustained high growth. This has been possible through our right policies, true intentions, and appropriate decisions. In the full budget in July, our Government will present a detailed roadmap for our pursuit of ‘Viksit Bharat’.

Revised Estimates 2023-24

The Revised Estimate of the total receipts other than borrowings is ₹27.56 lakh crore, of which the tax receipts are ₹23.24 lakh crore. The Revised Estimate of the total expenditure is ₹44.90 lakh crore.

The revenue receipts at ₹30.03 lakh crore are expected to be higher than the Budget Estimate, reflecting strong growth momentum and formalization in the economy.

The Revised Estimate of the fiscal deficit is 5.8% of GDP, improving on the Budget Estimate, notwithstanding moderation in the nominal growth estimates.

Budget Estimates 2024-25

Coming to 2024-25, the total receipts other than borrowings and the total expenditure are estimated at ₹30.80 and ₹47.66 lakh crore respectively. The tax receipts are estimated at ₹26.02 lakh crore.
The scheme of fifty-year interest free loan for capital expenditure to states will be continued this year with total outlay of ₹1.3 lakh crore.

We continue on the path of fiscal consolidation, as announced in my Budget Speech for 2021-22, to reduce fiscal deficit below 4.5% by 2025-26. The fiscal deficit in 2024-25 is estimated to be 5.1% of GDP, adhering to that path.

The gross and net market borrowings through dated securities during 2024-25 are estimated at ` ₹14.13 and ₹11.75 lakh crore respectively. Both will be less than that in 2023-24. Now that the private investments are happening at scale, the lower borrowings by the Central Government will facilitate larger availability of credit for the private sector.

Vote on Account

I will be seeking ‘vote on account’ approval of the Parliament through the Appropriation Bill for a part of the financial year 2024-25.

I will, now, move to Part B.

Part B

Hon’ble Speaker Sir,

Direct taxes

Over the last ten years, the direct tax collections have more than trebled and the return filers swelled to 2.4 times. I would like to assure the taxpayers that their contributions have been used wisely for the development of the country and welfare of its people. I appreciate the taxpayers for their support.

The Government has reduced and rationalized tax rates. Under the new tax scheme, there is now no tax liability for taxpayers with income up to ₹7 lakh, up from ₹2.2 lakh in the financial year 2013-14. The threshold for presumptive taxation for retail businesses was increased from ₹2 crore to ₹3 crore. Similarly, the threshold for professionals eligible for presumptive taxation was increased from ₹50 lakh to ₹75 Lakh. Also, corporate tax rate was decreased from 30% to 22% for existing domestic companies and to 15% for certain new manufacturing companies.

In the last five years, our focus has been to improve tax-payer services. The age-old jurisdiction-based assessment system was transformed with the introduction of Faceless Assessment and Appeal, thereby imparting greater efficiency, transparency and accountability. Introduction of updated income tax returns, a new Form 26AS and prefilling of tax returns have made filing of tax returns simpler and easier. Average processing time of returns has been reduced from 93 days in the year 2013-14 to a mere ten days this year, thereby making refunds faster.

Indirect Taxes

By unifying the highly fragmented indirect tax regime in India, GST has reduced the compliance burden on trade and industry. The industry has acknowledged the benefits of GST. According to a recent survey conducted by a leading consulting firm, 94% of industry leaders view the transition to GST as largely positive. According to 80% of the respondents, it has led to supply chain optimisation, as elimination of tax arbitrage and octroi has resulted in disbanding of check posts at state and city boundaries. At the same time, tax base of GST more than doubled and the average monthly gross GST collection has almost doubled to ₹1.66 lakh crore, this year. States too have benefited. States’ SGST revenue, including compensation released to states, in the post-GST period of 2017-18 to 2022-23, has achieved a buoyancy of 1.22. In contrast, the tax buoyancy of State revenues from subsumed taxes in the pre-GST four-year period of 2012-13 to 2015-16 was a mere 0.72. The biggest beneficiaries are the consumers, as reduction in logistics costs and taxes have brought down prices of most goods and services.

We have taken a number of steps in Customs to facilitate international trade. As a result, the import release time declined by 47% to 71 hours at Inland Container Depots, by 28% to 44 hours at air cargo complexes and by 27% to 85 hours at sea ports, over the last four years since 2019, when the National Time Release Studies were first started.

Tax proposals

As for tax proposals, in keeping with the convention, I do not propose to make any changes relating to taxation and propose to retain the same tax rates for direct taxes and indirect taxes including import duties. However, certain tax benefits to start-ups and investments made by sovereign wealth or pension funds as also tax exemption on certain income of some IFSC units are expiring on March 31, 2024. To provide continuity in taxation, I propose to extend the date to March 31, 2025.

Moreover, in line with our Government’s vision to improve ease of living and ease of doing business, I wish to make an announcement to improve taxpayer services. There are a large number of petty, non-verified, non-reconciled or disputed direct tax demands, many of them dating as far back as the year 1962, which continue to remain on the books, causing anxiety to honest tax payers and hindering refunds of subsequent years. I propose to withdraw such outstanding direct tax demands up to twenty-five thousand rupees (₹25,000) pertaining to the period up to financial year 2009-10 and up to ten-thousand rupees (₹10,000) for financial years 2010-11 to 2014-15. This is expected to benefit about a crore tax-payers.

Economy – Then vs Now

In 2014 when our Government assumed the reins, the responsibility to mend the economy step by step and to put the governance systems in order was enormous. The need of the hour was to give hope to the people, to attract investments, and to build support for the much-needed reforms. The government did that successfully following our strong belief of ‘nation-first’.

The crisis of those years has been overcome, and the economy has been put firmly on a high sustainable growth path with all-round development. It is now appropriate to look at where we were then till 2014 and where we are now, only for the purpose of drawing lessons from the mismanagement of those years. The government will lay a White Paper on table of the House.

The exemplary track record of governance, development and performance, effective delivery, and ‘Jan Kalyan’ has given the Government trust, confidence and blessings of the people to realize, whatever it takes, the goal of ‘Viksit Bharat’ with good intentions, true dedication and hard work in the coming years and decades.

With this, I commend the interim budget to this august House.

Jai Hind

Budget 2024: Govt plans to set up more medical colleges by utilising existing hospital infrastructure, says FM

Finance Minister Nirmala Sitharaman on Thursday, February 1, said the government plans to set up more medical colleges by utilising existing hospital infrastructure. While presenting the interim Budget for 2024-2025, Sitharaman said the government will set up a committee to examine the matter.

“Several youth are ambitious to get qualified as doctors. They aim to serve our people through improved healthcare services. Our government plans to set up more medical colleges by utilising the existing hospital infrastructure under various departments.

“A committee for this purpose will be set up to examine the issues and make relevant recommendations,” Sitharaman said.

This week, the NEET PG examination fee was reduced by Rs 750 for all candidates. The National Board of Examinations in Medical Sciences (NBEMS) has decided to reduce the exam fees to benefit the lakhs of candidates appearing for the examinations under it, the official said. In 2013, application fee for general and OBC category was Rs 3,750, which was raised to Rs 4,250 in 2021 (the current fee). This has been reduced to Rs 3,500 with effect from January 1, 2024. In 2013, the application fee for SC, ST and PWD candidates was Rs 2,750, which was which was raised to Rs 3,250 in 2021. This has been reduced to Rs 2,500 now.

The minister added that the government will encourage vaccination for girls aged 9 to 14 years for the prevention of cervical cancer. Various schemes for maternal and child healthcare will be brought under one comprehensive programme for synergy in implementation, Sitharaman said.

The minister said the government will expedite the upgradation of anganwadi centres under Saksham Anganwadi and Poshan 2.0 for improved nutrition delivery, early childhood care and development.

“The healthcare cover under the Ayushman Bharat will be extended to all ASHA workers, Anganwadi workers and helpers,” the minister said.

She was appointed as the finance minister when Narendra Modi swept to power again in the 2019 election and presented her maiden Budget on July 5, 2019. The Budget for 2024-25 is Sitharaman’s sixth straight Budget.

The four new castes of India, according to the Finance Minister

“As our Prime Minister firmly believes, we need to focus on four major castes. They are, ‘Garib’ (poor), ‘Mahilayen’ (women), ‘Yuva’ (youth) and ‘Annadata’ (food provider i.e. farmer),” said Finance Minister Nirmala Sitharaman in her her Budget 2024 presentation.

Click here for live updates on the Interim Budget 2024

Sitharaman’s comment becomes significant coming in the wake of a raging political debate over the caste census — last released in 1931; the data collected in 2011 was never released — in the country. 

“Social justice is not just a slogan. We have shown that it’s a governance model for us,” she emphasised in her post-budget press conference.

For the uninitiated, the traditional Hindu community in India comprises four communities in descending order of social status and privilege — Brahmin (priests), Kshatriya (warriors), Vaishya (merchants) and Shudra (workers with menial jobs and untouchables).  

In that context, Sitharaman’s attempt to reimagine caste categories can be seen as an attempt to reinforce the party’s resistance to the growing demand for a caste census from rival political parties across the country.

Bihar has already conducted one and released the results. Andhra Pradesh has initiated the process for a similar survey. Regional leaders in other states are also debating it.

The idea is that government policies should be reshaped based on the latest caste composition of the populace to ensure better delivery of social justice.

The Bharatiya Janata Party (BJP), which Sitharaman belongs to, has resisted these demands saying such an exercise will deepen the cracks caused by the discriminatory caste system.

Simultaneously, supporters of the BJP believe that the popularity of Narendra Modi transcends traditional caste loyalties, which are deeply embedded in Indian society and the country’s politics.

After decades of political efforts to stop the discrimination and dilute caste identities, it’s still, very often, said that Indians don’t cast their votes, they vote their castes.

India’s centuries-long history of caste-based discrimination has been a flashpoint for social and political rivalries across the country since the country’s independence.

Despite Modi’s political might, unprecedented as it is in recent decades of Indian politics, the lines between the progressives (who want affirmative action to compensate for caste-based discrimination) and the conservatives who oppose such policies won’t be erased easily.

These are some of the government’s achievements and initiatives targeting each segment, or caste, highlighted by the Finance Minister. 

For the poor:

• 250 million people have risen from multidimensional poverty in a decade
• 800 million people have been given subsidised food.
• ₹ 34 lakh crore of government subsidies have been directly transferred to people’s bank accounts, minimising leakages and generating substantial savings for the government.
• Initiatives like PM SVANIDHI, PM JANMAN Yojana, PM Vishwakarma Yojana, and schemes for divyang (specially abled) and transgender empowerment.

LIVE | Watch the Interim Budget 2024 non-stop live coverage on CNBC-TV18

Addressing youth concerns,

• 430 million loans totalling ₹22.5 lakh crore for new entrepreneurs
• Initiation of schemes such as dedicated funds and schemes to promote startups
• Skill India Mission
• The construction of new educational institutions: Indian Institute of Technology (IIT) in seven new locations, Indian Institute of Information Technology (IIIT) at 16 locations, seven new campuses of Indian Institute of Management (IIM), 15 medical colleges under the banner of All India Institute of Medical Sciences (AIIMS), and 390 other universities

For women empowerment

• 30 crore Mudra Yojana loans have been given to women entrepreneurs
• Female enrolment in higher education has gone up by twenty-eight per cent in ten years.
• In STEM courses, girls and women constitute forty-three per cent of enrolment – one of the highest in the world.
• The government’s family law made Triple Talaq illegal, and one-third of legislative seats are now reserved for women.

Click for Income Tax Budget 2024 Live Updates here

For farmers

• The periodic increase in minimum support prices
• Financial assistance for 118 million farmers
• Crop insurance claims paid to 40 million farmers under a government scheme

Check market reaction to Budget 2024

Budget 2024: FM announces new housing scheme for middle class and 2 crore more houses under PMAY-Gramin

In her last Budget 2024 announcement before the Lok Sabha elections, Finance Minister Nirmala Sitharaman said the government would launch a housing scheme for the middle class, schemes to help slum dwellers as well as those living on rent.

She also said the government will give 2 crore more houses under Pradhan Mantri Awas Yojna – Gramin. “We are close to achieving the target of 3 crore under the rural housing scheme. Two crore more would be constructed in the next five years,” said Sitharaman.

Sushil Mohta, President, CREDAI West Bengal and Chairman, Merlin Group, said, “Under Pradhan Mantri Awas Yojana, the announcement to build the additional 2 crore rural houses in the next 5 years is encouraging. These will support the housing market to grow. This will not only create lot of job opportunities for those in housing and construction industry but will also provide a lot of scopes on the ancillary industries like cement, paint etc.”

On the new housing scheme for the middle class, the FM said the government will launch a housing scheme for deserving middle class to buy or build their own homes. The government will also launch schemes to help slum dwellers, and people living on rent and enable them to buy and build their own houses, Sitharaman said.

Sitharaman again took a digital tablet wrapped in a traditional ‘bahi-khata’ style pouch as she presented the interim Budget 2024-25 in a paperless format just like the previous three years.

Sitharaman, India’s first full-time woman Finance Minister, had in July 2019 ditched the colonial legacy of a Budget briefcase for the traditional ‘bahi-khata’ to carry Union Budget papers.

She used the same in the following year, and in a pandemic-hit 2021, she swapped traditional papers with a digital tablet for carrying her speech and other Budget documents.

Her Budget for the fiscal beginning April 2024 (FY2024-24) is the Modi government’s 12th straight Budget since 2014 (including one interim Budget presented ahead of general elections in 2019).

She was appointed as the finance minister when Narendra Modi swept to power again in the 2019 election and presented her maiden Budget on July 5, 2019. The Budget for 2024-25 is Sitharaman’s sixth straight Budget.

With inputs from PTI

Budget 2024 | Experts discuss key expectations, weighs in on market developments

As the eagerly awaited Budget 2024 is around the corner, financial experts from various investment firms share their insights and expectations on the upcoming economic policies. Speaking to CNBC-TV18, prominent figures in the finance industry express their views on the budget and its potential impact on the Indian economy.

When asked about his expectations from the Budget, Nilesh Shah, MD of Kotak Mahindra AMC emphasized the need for a vote on account that stimulates consumption at the bottom of the pyramid, ensuring it grows at a pace parallel to the top. Shah stressed the importance of pushing private capital expenditure to match government spending. He believes that achieving these two catalysts, coupled with fiscal prudence, will make Indians proud of their country, creating envy among neighbors.

Budget 2024 LIVE Updates: Government weighs extension of NPS benefits to new tax regime?

Shah outlined three key expectations: continued investment, inclusive growth, and a commitment to fiscal prudence.

Taher Badshah, CIO, Invesco Mutual Fund expressed the desire for continuity in the economic policies while highlighting the need for additional levers to ensure visible growth beyond 2024. His statement emphasized the importance of sustained economic momentum for the coming years.

Also Read | Editor’s Take: Market and the (Interim) Budget

Nilesh Shah, MD & CEO of Envision Capital expects a comprehensive set of measures in the Budget that can potentially uplift the spending power of rural households. He envisions policies aimed at promoting economic well-being at the grassroots level.

Nilesh Shah of Envision Capital also weighed in on the challenges faced by Paytm, acknowledging the hurdles it currently confronts. The prevailing uncertainty surrounding the company, its business, and its stock is anticipated to take some time to resolve.

Also Read | RBI hits Paytm Payments Bank with more restrictions; almost all services to stop from Feb 29

The recent Reliance Industries Ltd (RIL)-Disney deal, where Disney sold its Indian assets to Viacom18 for $3.9 billion, has been hailed as a massive positive development by Envision Capital’s Shah. He sees it as a significant consolidation that places Reliance and its media business in a pole position, creating optimism among investors.

“This is a huge positive. We own Reliance Industries Ltd (RIL), so I have a vested interest,” he said.

Also Read | Budget 2024: It’s an interim budget, let’s not get too excited about it, says Jahangir Aziz

According to KV Subramanian, Former CEA, Board Member for India, IMF, “This is a vote on account and therefore what the government is really doing is essentially getting an approval from parliament for spending for a few months till the actual budget happens.”

Mahesh Nandurkar, India Strategist, Jefferies believes this will be the full-fledged Budget for the year.

“It is technically an Interim Budget but for all practical purposes, we should view this as a proper full year budget in my view. if the same party and the same ministers are going to be assuming the similar roles, it will be very difficult to argue for a very different budget in July as compared to February and the consensus today is that of a political continuity. So I would take this budget and budget numbers quite seriously,” he said.

For more, watch the accompanying video