Tribune News Service
New Delhi, February 1
Despite a huge deficit due to Covid-induced lockdown and a carried-over drag on demand, the government kept intact its push for capital expenditure by a higher-than-expected borrowing plan and an ambitious sale of government assets ranging from ports, airports, cricket stadia and warehouses to insurance companies.
Edit: Budget of tough calls
Unveiling the first paperless Budget, Finance Minister Nirmala Sitharaman announced record capital expenditure of Rs 5.54 lakh crore to finance over 11,000-km highways and metros, rapid rail transport projects for 27 cities, mega textile parks besides continuing with the thrust on existing Bharatmala projects.
With farmers gathered around Delhi, the government has proposed an agriculture cess, which will make coal, apple, electronics and cotton goods more expensive. The imposition of cess is aimed at ensuring dedicated resources for infrastructure development in rural areas. The Finance Minister also pointed out how the Centre had not only been purchasing more farm produce, but also expanding the ambit to more states and crops.
The Budget also proposes to plug the gaps in health infrastructure by effecting 137% hike in allocation as compared with the current year figure. However, a regulatory body to check capriciousness of private hospitals, as suggested by the Economic Survey, remained elusive. A sum of Rs 37,000 crore has been allocated for Covid vaccines in the next fiscal with a promise of more, if required. Those above 75 years of age will no longer be required to file income tax returns, if their income is from pension and interest only.
The Budget also provides for cutting the time period for retro-inspection of income tax returns and stepping up the process of faceless interface. However, there is no change in the personal income tax slabs for individuals.
Interest on employee contributions to provident fund over Rs 2.5 lakh per annum would be taxed from April 1, 2021.
The Finance Minister also proposed to increase foreign direct investment (FDI) limit in the insurance sector to 74 per cent from the present 49 per cent. The move is aimed at attracting greater overseas capital inflows to help enhance insurance penetration in the country.
Tense borders have led to an increase of about Rs 25,000 crore in defence expenditure, including the highest ever allocation for purchasing defence platforms.
Social welfare projects, including the Jal Jeevan Mission and Swachh Bharat, will continue apace with the addition of Rs 2,217 crore to tackle air pollution in 42 urban centres.
The Education Ministry gets 9.5 per cent more allocation this year, along with a promise of 100 sainik schools in PPP mode. There is, however, no separate allocation for the National Education Policy-2020, Operation Digital Board (ODB) outlay remains stagnant, the Mid-Day Meal Scheme will see a Rs 1,400-crore drop and no allocation was made for madrasas and minorities.
There were several adjustments in customs duty to promote make-in-India initiative and address complaints of inverted duty structure. The FM suggested a major makeover in the coming days. The Budget speech suggested a large number of legislative amendments as well as new laws to enable the sale of PSUs and insurance companies.