Presenting the first Union Budget of the third decade of 21st century, Finance Minister Smt. Nirmala Sitharaman, today unveiled a series of far-reaching reforms, aimed at energizing the Indian economy through a combination of short-term, medium-term, and long-term measures.

Key Highlights of Union Budget 2020-21
Key Highlights of Union Budget 2020-21

The Key Highlights of Union Budget 2020-21 are as follows:

Three prominent themes of the Budget

  • Aspirational India - better standards of living with access to health, education and better jobs for all sections of the society
  • Economic Development for all- “Sabka Saath , Sabka Vikas , Sabka Vishwas”.
  • Caring Society- both humane and compassionate; Antyodaya as an article of faith.
  • Three broad themes are held together by:
    • Corruption free, policy-driven Good Governance.
    • Clean and sound financial sector.
  • Ease of Living underlined by the three themes of Union Budget 2020-21.

Three components of Aspirational India

  • Agriculture, Irrigation, and Rural Development
  • Wellness, Water, and Sanitation
  • Education and Skills

Sixteen Action Points for Agriculture, Irrigation and Rural Development

  • Rs. 2.83 lakh crore to be allocated for the following 16 Action Points:
    • Rs. 1.60 lakh crore for Agriculture, Irrigation & allied activities.
    • Rs. 1.23 lakh crore for Rural development & Panchayati Raj. -
  • Agriculture credit:
    • Rs. 15 lakh crore target set for the year 2020-21.
    • PM-KISAN beneficiaries to be covered under the KCC scheme.
    • NABARD Re-finance Scheme to be further expanded.
  • Comprehensive measures for 100 water-stressed districts proposed.
  • Blue Economy:
    • Rs. 1 lakh crore fisheries’ exports to be achieved by 2024-25.
    • 200 lakh tonnes fish production targeted by 2022-23.
    • 3477 Sagar Mitras and 500 Fish Farmer Producer Organisations to involve youth in fisheries extension.
    • Growing of algae, sea-weed and cage culture to be promoted.
    • Framework for development, management and conservation of marine fishery resources.
  • Kisan Rail to be setup by Indian Railways through PPP:
    • To build a seamless national cold supply chain for perishables (milk, meat, fish, etc.
    • Express and Freight trains to have refrigerated coaches.
  • Krishi Udaan to be launched by the Ministry of Civil Aviation:
    • Both international and national routes to be covered.
    • North-East and tribal districts to realize Improved value of agri-products.
  • One-Product One-Districtfor better marketing and export in the Horticulture sector.
  • Balanced use of all kinds of fertilizers - traditional organic and innovative fertilizers.
  • Measures for organic, natural, and integrated farming:
    • Jaivik Kheti Portal – online national organic products market to be strengthened.
    • Zero-Budget Natural Farming(mentioned in July 2019 Budget) to be included.

o Integrated Farming Systems in rain-fed areas to be expanded.

o Multi-tier cropping, bee-keeping, solar pumps, solar energy production in non-cropping season to be added.

  • PM-KUSUM to be expanded:
    • 20 lakh farmers to be provided for setting up stand-alone solar pumps.
    • Another 15 lakh farmers to be helped to solarise their grid-connected pump sets.
    • Scheme to enable farmers to set up solar power generation capacity on their fallow/barren lands and to sell it to the grid.
  • Village Storage Scheme:
    • To be run by the SHGs to provide farmers a good holding capacity and reduce their logistics cost.
    • Women, SHGs to regain their position as Dhaanya Lakshmi.
  • NABARD to map and geo-tag agri-warehouses, cold storages, reefer van facilities, etc.
  • Warehousing in line with Warehouse Development and Regulatory Authority (WDRA) norms:
    • Viability Gap Funding for setting up such efficient warehouses at the block/taluk level.
    • Food Corporation of India (FCI) and Central Warehousing Corporation (CWC) to undertake such warehouse building.
  • Financing on Negotiable Warehousing Receipts (e-NWR) to be integrated with e-NAM.
  • State governments who undertake implementation of model laws (issued by the Central government) to be encouraged.
  • Livestock:
    • Doubling of milk processing capacity to 108 million MT from 53.5 million MT by 2025.
    • Artificial insemination to be increased to 70% from the present 30%.
    • MNREGS to be dovetailed to develop fodder farms.
    • Foot and Mouth Disease, Brucellosis in cattle and Peste Des Petits ruminants (PPR) in sheep and goat to be eliminated by 2025.
  • Deen Dayal Antyodaya Yojana – 0.5 crore households mobilized with 58 lakh SHGs for poverty alleviation.

Wellness, Water and Sanitation

  • Rs. 69,000 crore allocated for overall Healthcare sector.
  • Rs. 6400 crore (out of Rs. 69,000 crore) for PM Jan Arogya Yojana (PMJAY):
    • More than 20,000 hospitals already empanelled under PM Jan Arogya Yojana (PMJAY).
    • Viability Gap Funding window proposed for setting up hospitals in the PPP mode.
    • Aspirational Districts with no Ayushman empanelled hospitals to be covered in the first phase.
    • Targeting diseases with an appropriately designed preventive regime using Machine Learning and AI.
  • Jan Aushadhi Kendra Scheme to offer 2000 medicines and 300 surgicals in all districts by 2024.
  • TB Harega Desh Jeetega campaign launched - commitment to end Tuberculosis by 2025.
  • Rs. 3.60 lakh crore approved for Jal Jeevan Mission:
    • Rs. 11,500 crore for the year 2020-21.
    • Augmenting local water sources, recharging existing sources, and promoting water harvesting and de-salination.
    • Cities with million-plus population to be encouraged to achieve the objective during the current year itself.
  • Rs.12, 300 crore allocation for Swachh Bharat Mission in 2020-21:
    • Committment to ODF-Plus in order to sustain ODF behaviour.
    • Emphasis on liquid and grey water management.

o Focus also on Solid-waste collection, source segregation, and processing.

Education and Skills

  • Rs. 99,300 crore for education sector and Rs. 3000 crore for skill development in 2020-21.
  • New Education Policy to be announced soon.
  • National Police University and National Forensic Science Universityproposed for policing science, forensic science, and cyber-forensics.
  • Degree level full-fledged online education program by Top-100 institutions in the National Institutional Ranking Framework.
  • Up to 1-year internship to fresh engineers to be provided by Urban Local Bodies.
  • Budget proposes to attach a medical college to an existing district hospital in PPP mode.
  • Special bridge courses to be designed by the Ministries of Health, and Skill Development:
    • To fulfill the demand for teachers, nurses, para-medical staff and care-givers abroad.
    • To bring in equivalence in the skill sets of the workforce and employers’ standards.
  • 150 higher educational institutions to start apprenticeship embedded degree/diploma courses by March 2021.
  • External Commercial Borrowings and FDI to be enabled for education sector.
  • Ind-SAT proposed for Asian and African countries as a part of Study in India program.

Economic Development

Industry, Commerce and Investment

  • Rs. 27,300 crore allocated for 2020-21 for development and promotion of Industry and Commerce.
  • Investment Clearance Cell proposed to be set up:

o To provide “end to end” facilitation and support.

o To work through a portal.

  • Five new smart cities proposed to be developed.
  • Scheme to encourage manufacture of mobile phones, electronic equipment and semi-conductor packaging proposed.
  • National Technical Textiles Mission to be set up:

o With four-year implementation period from 2020-21 to 2023-24.

o At an estimated outlay of Rs 1480 crore.

o To position India as a global leader in Technical Textiles.

  • New scheme NIRVIK to be launched to achieve higher export credit disbursement, which provides for:

o Higher insurance coverage

o Reduction in premium for small exporters

o Simplified procedure for claim settlements.

  • Turnover of Government e-Marketplace (GeM) proposed to be taken to Rs 3 lakh crore.
  • Scheme for Revision of duties and taxes on exported products to be launched.

o Exporters to be digitally refunded duties and taxes levied at the Central, State and local levels, which are otherwise not exempted or refunded.

  • All Ministries to issue quality standard orders as per PM’s vision of “Zero Defect-Zero Effect” manufacturing.

Infrastructure

  • Rs.100 lakh crore to be invested on infrastructure over the next 5 years.
  • National Infrastructure Pipeline:

o Rs. 103 lakh crore worth projects; launched on 31st December 2019.

o More than 6500 projects across sectors, to be classified as per their size and stage of development.

  • A National Logistics Policy to be released soon:

o To clarify roles of the Union Government, State Governments and key regulators.

o A single window e-logistics market to be created

o Focus to be on generation of employment, skills and making MSMEs competitive.

  • National Skill Development Agency to give special thrust to infrastructure-focused skill development opportunities.
  • Project preparation facility for infrastructure projects proposed.

o To actively involve young engineers, management graduates and economists from Universities.

  • Infrastructure agencies of the government to involve youth-power in start-ups.
  • Rs.1.7 lakh crore proposed for transport infrastructure in 2020-21.

Source of Deficit Financing

Highways:

  • Accelerated development of highways to be undertaken, including:

o 2500 Km access control highways.

o 9000 Km of economic corridors.

o 2000 Km of coastal and land port roads.

o 2000 Km of strategic highways.

  • Delhi-Mumbai Expressway and two other packages to be completed by 2023.
  • Chennai-Bengaluru Expressway to be started.
  • Proposed to monetise at least 12 lots of highway bundles of over 6000 Km before 2024.

Indian Railways:

  • Five measures:

o Large solar power capacity to be set up alongside rail tracks, on land owned by railways.

o Four station re-development projects and operation of 150 passenger trains through PPP.

o More Tejas type trains to connect iconic tourist destinations.

o High speed train between Mumbai and Ahmedabad to be actively pursued.

o 148 km long Bengaluru Suburban transport project at a cost of Rs 18600 crore, to have fares on metro model. Central Government to provide 20% of equity and facilitate external assistance up to 60% of the project cost.

  • Indian Railways’ achievements:

o 550 Wi-fi facilities commissioned in as many stations.

o Zero unmanned crossings.

o 27000 Km of tracks to be electrified.

Ports & Water-ways:

  • Corporatizing at least one major port and its listing on stock exchanges to be considered.
  • Governance framework keeping with global benchmarks needed for more efficient sea-ports.
  • Economic activity along river banks to be energised as per Prime Minister’s Arth Ganga concept.

Airports:

  • 100 more airports to be developed by 2024 to support Udaan scheme.
  • Air fleet number expected to go up from present 600 to 1200 during this time.

Electricity:

  • “Smart” metering to be promoted.
  • More measures to reform DISCOMs to be taken.

Power:

  • Rs.22, 000 crore proposed for power and renewable energy sector in 2020-21.
  • Expansion of national gas grid from the present 16200 km to 27000 km proposed.
  • Further reforms to facilitate transparent price discovery and ease of transactions.

New Economy

  • To take advantage of new technologies:

o Policy to enable private sector to build Data Centre parks throughout the country to be brought out soon.

o Fibre to the Home (FTTH) connections through Bharatnet to link 100,000 gram panchayats this year.

o Rs.6000 crore proposed for Bharatnet programme in 2020-21.

  • Measures proposed to benefit Start-ups:

o A digital platform to be promoted to facilitate seamless application and capture of IPRs.

o Knowledge Translation Clusters to be set up across different technology sectors including new and emerging areas.

o For designing, fabrication and validation of proof of concept, and further scaling up Technology Clusters, harbouring test beds and small scale manufacturing facilities to be established.

o Mapping of India’s genetic landscape- Two new national level Science Schemes to be initiated to create a comprehensive database.

o Early life funding proposed, including a seed fund to support ideation and development of early stage Start-ups.

  • Rs.8000 crore proposed over five years for National Mission on Quantum Technologies and Applications.

Caring Society

  • Focus on:

o Women & child,

o Social Welfare;

o Culture and Tourism

  • Allocation of Rs. 35,600 crore for nutrition-related programmes proposed for the FY2020-21.
  • Rs.28, 600 crore proposed for women specific programs.
  • Issue about age of a girl entering motherhood - proposed to appoint a task force to present its recommendations in six months’ time.
  • Financial support for wider acceptance of technologies, identified by Ministry of Housing and Urban Affairs to ensure no manual cleaning of sewer systems or septic tanks, to be provided.
  • Rs. 85, 000 crore proposed for 2020-21 for welfare of Scheduled Castes and Other Backward Classes.
  • Rs. 53, 700 crore provided to further development and welfare of Scheduled Tribes.
  • Enhanced allocation of Rs. 9,500 crore provided for 2020-21 for senior citizens and Divyang.

Culture & Tourism

  • Allocation of Rs. 2500 crore for 2020-21 for tourism promotion.
  • Rs.3150 crore proposed for Ministry of Culture for 2020-21.
  • An Indian Institute of Heritage and Conservation under Ministry of Culture proposed; with the status of a deemed University.
  • 5 archaeological sites to be developed as iconic sites with on-site Museums:

o Rakhigarhi (Haryana)

o Hastinapur (Uttar Pradesh)

o Shivsagar (Assam)

o Dholavira (Gujarat)

o Adichanallur (Tamil Nadu)

  • Re-curation of the Indian Museum in Kolkata, announced by Prime Minister in January 2020.
  • Museum on Numismatics and Trade to be located in the historic Old Mint building in Kolkata.
  • 4 more museums from across the country to be taken up for renovation and re-curation.
  • Support for setting up of a Tribal Museum in Ranchi (Jharkhand).
  • Maritime museum to be set up at Lothal- the Harrapan age maritime site near Ahmedabad, by Ministry of Shipping.
  • State governments expected to develop a roadmap for certain identified destinations and formulate financial plans during 2021 against which specified grants to be made available to the States in 2020-21.

Environment & Climate Change

  • Allocation for this purpose to be Rs.4400 crore for 2020-21.
  • Proposed to advise the utilities to close the running old thermal power plants with carbon emission above the pre-set norms.
  • States that are formulating and implementing plans for ensuring cleaner air in cities above one million to be encouraged.
  • PM launched Coalition for Disaster Resilient Infrastructure (CDRI) with Secretariat in Delhi. Second such international initiative after International Solar Alliance.

Governance

  • Clean, corruption-free, policy driven, good in intent and most importantly trusting in faith.
  • Taxpayer Charter to be enshrined in the Statute will bring fairnessand efficiency in tax administration.
  • Companies Act to be amended to build into statues, criminal liability for certain acts that are civil in nature.
    • Other laws with such provisions are to be corrected after examination.
  • Major reforms in recruitment to Non-Gazetted posts in Government and Public sector banks:
    • An independent, professional and specialist National Recruitment Agency (NRA) for conducting a computer-based online Common Eligibility Test for recruitment.
    • A test-centre in every district, particularly in the Aspirational Districts.
  • A robust mechanism to be evolved for appointment including direct recruitment to various Tribunals and specialised bodies to attract best talents and professional experts.
  • Contract Act to be strengthened.
  • New National Policy on Official Statistics to:
    • Promote use of latest technologies including AI.
    • Lay down a road-map towards modernised data collection, integrated information portal and timely dissemination of information.
  • A sum of Rs. 100 crore allocated to begin the preparations for G20 presidency to be hosted in India in the year 2022.
  • Development of North East region:
    • Improved flow of funds using online portal by the Government.
    • Greater access to financial assistance of Multilateral and Bilateral funding agencies.
  • Development of Union Territories of J&K and Ladakh:
    • An amount of Rs. 30,757 crore provided for the financial year 2020-21.

o The Union Territory of Ladakh has been provided with Rs. 5,958.

Financial Sector

  • Reforms accomplished in PSBs :
    • 10 banks consolidated into 4.
    • Rs. 3,50,000 crore capital infused.
  • Governance reforms to be carried out to bring in transparency and greater professionalism in PSBs.
  • Few PSBs to be encouraged to approach the capital market to raise additional capital
  • Deposit Insurance and Credit Guarantee Corporation (DICGC) permitted to increase Deposit Insurance Coverage to Rs. 5 lakh from Rs.1 lakh per depositor.
  • Scheduled Commercial Bank’s health under monitoring through a robust mechanism, keeping depositors’ money safe.
  • Cooperative Banks to be strengthen by amending Banking Regulation Act for:
    • Increasing professionalism.
    • Enabling access to capital.
    • Improving governance and oversight for sound banking through the RBI.
  • NBFCs eligibility limit for debt recovery reduced from:
    • Rs. 500 crore to Rs 100 crore asset size.
    • Rs 1 crore to Rs 50 lakh loan size.
  • Private capital in Banking system:
    • Government to sell its balance holding in IDBI Bank to private, retail and institutional investors through the stock exchange.
  • Easier mobility in jobs:
    • Auto-enrolment in Universal Pension coverage.
    • Inter-operability mechanism to safeguard the accumulated corpus.
  • Pension Fund Regulatory Development Authority of India Act to be amended to:
    • Strengthen regulating role of PFRDAI.
    • Facilitate separation of NPS trust for government employees from PFRDAI.
    • Enable establishment of a Pension Trust by the employees other than Government.
  • Factor Regulation Act 2011 to be amended to:
    • Enable NBFCs to extend invoice financing to the MSMEs through TReDS
  • New scheme to provide subordinate debt for entrepreneurs of MSMEs by the banks
    • Would be counted as quasi-equity.
    • Would be fully guaranteed through the Credit Guarantee Trust for Medium and Small Entrepreneurs (CGTMSE).
    • The corpus of the CGTMSE would accordingly be augmented by the government.
  • Window for MSME’s debt restructuring by RBI to be extended by one year till March 31, 2021.
    • More than five lakh MSMEs have already been benefitted.
  • An app-based invoice financing loans product for MSMEs to be launched.
    • To prevent the problem of delayed payments and consequential cash flows mismatches.
  • Export promotion of MSMEs:
    • For selected sector such as pharmaceuticals, auto components and others.
    • An Rs 1000 crore scheme anchored by EXIM Bank together with SIDBI.

o Hand holding support for technology upgradations, R&D, business strategy etc.

Financial Market

  • Deepening Bond Market.
    • Certain specified categories of Government securities to be opened fully for non -resident investors also.
    • FPI limit in corporate bonds increased to 15% from 9% of its outstanding stock.
  • New legislation to be formulated for laying down a mechanism for netting of financial contracts.
    • Scope of credit default swaps to expand.
  • Debt Based Exchange Traded Fund expanded by a new Debt-ETF consisting primarily of Government Securities.
    • To give attractive access to retail investors, pension funds and long-term investors.
  • A Partial Credit Guarantee scheme for the NBFCs formulated post the Union budget 2019-20 to address their liquidity constraints.
    • New mechanism to be devised to further this.

o Government support to securities so floated.

Infrastructure Financing

  • Rs.103 lakh crore National Infrastructure Pipeline projects earlier announced.
  • Rs 22,000 crore to cater to the equity support to Infrastructure Finance Companies such as IIFCL and a subsidiary of NIIF.
  • IFSC, GIFT city: full of potential to become a centre of international finance as well as a centre for high end data processing:

o An International Bullion exchange(s) to be set up as an additional option for trade by global market participants with the approval of regulator.

Disinvestment

  • Government to sell a part of its holding in LIC by way of Initial Public Offer (IPO).

Fiscal Management

  • XV Finance Commission (FC):

o XV Finance Commission has given its first report for FY2020-21

o Recommendations accepted in substantial measure

o Its final report for five years beginning 2021-22 to be submitted during the latter part of the year.

  • GST Compensation Fund:

o Balances due out of collection of the years 2016-17 and 2017-18 to be transferred to the Fund, in two instalments.

o Hereinafter, transfers to the fund to be limited only to collection by way of GST compensation cess.

  • Overhaul of Centrally Sponsored Schemes and Central Sector Schemes necessary:

o To align them with emerging social and economic needs of tomorrow

o To ensure that scarce public resources are spent optimally

  • On the recent debate over transparency and credibility of projected fiscal numbers, it is assured that procedure adopted is compliant with the FRBM Act.
  • For the FY 2019-20:

o Revised Estimates of Expenditure: at Rs.26.99 lakh crore

o Revised Estimates of Receipts: estimated at Rs.19.32 lakh crore.

  • For year 2020-21:

o Nominal growth of GDP estimated at 10%.

o Receipts: estimated at Rs.22.46 lakh cr

o Expenditure: at Rs.30.42 lakh cr.

  • Significant tax reforms for boosting investments recently undertaken. However, expected tax buoyancy expected to take time.
  • Fiscal deficit of 3.8% estimated in RE 2019-20 and 3.5% for BE 2020-21. It comprises two ingredients;

o 3.3% for year 2019-20 and 3% for the 2020-21 budget estimate.

o Deviation of 0.5%, consistent with Section 4(3) of FRBM Act, both for RE 2019-20 and BE 2020-21. (Section 4 (2) of the FRBM Act provides for a trigger mechanism for a deviation from the estimated fiscal deficit on account of structural reforms in the economy with unanticipated fiscal implications.)

o Return path, committing to fiscal consolidation without compromising needs of investment out of public funds, is laid in Medium Term Fiscal Policy cum Strategy Statement.

o Market borrowings: Net market borrowings: Rs.4.99 lakh crore for 2019-20 and Rs.5.36 lakh crore for 2020-21.

  • A good part of the borrowings for the financial year 2020-21 to go towards Capital expenditure that has been scaled up by more than 21%.

Central Government Expenditure

Direct Tax

Direct Tax Proposals - To stimulate growth, simplify tax structure, bring ease of compliance, and reduce litigations.

  • Personal Income Tax:
    • Significant relief to middle class taxpayers.
    • New and simplified personal income tax regime proposed:
Taxable Income Slab (Rs.) Existing tax rates New tax rates
0-2.5 Lakh Exempt Exempt
2.5-5 Lakh 5% 5%
5-7.5 Lakh 20% 10%
7.5-10 Lakh 20% 15%
10-12.5 Lakh 30% 20%
12.5-15 Lakh 30% 25%
Above 15 Lakh 30% 30%
    • Around 70 of the existing exemptions and deductions (more than 100) to be removed in the new simplified regime.
    • Remaining exemptions and deductions to be reviewed and rationalised in coming years.
    • New tax regime to be optional - an individual may continue to pay tax as per the old regime and avail deductions and exemptions.
    • Measures to pre-fill the income tax return initiated so that an individual who opts for the new regime gets pre-filled income tax returns and would need no assistance from an expert to pay income tax.
    • New regime to entail estimated revenue forgone of Rs. 40,000 crore per year.
  • Corporate Tax:
    • Tax rate of 15% extended to new electricity generation companies.
    • Indian corporate tax rates now amongst the lowest in the world.
  • Dividend Distribution Tax (DDT):
    • DDT removed making India a more attractive investment destination.
    • Deduction to be allowed for dividend received by holding company from its subsidiary.
    • Rs. 25,000 crore estimated annual revenue forgone.
  • Start-ups:
    • Start-ups with turnover up to Rs. 100 crore to enjoy 100% deduction for 3 consecutive assessment years out of 10 years.
    • Tax payment on ESOPs deferred.
  • MSMEs to boost less-cash economy:
    • Turnover threshold for audit increased to Rs. 5 crore from Rs. 1 crore for businesses carrying out less than 5% business transactions in cash.
  • Cooperatives:
    • Parity brought between cooperatives and corporate sector.
    • Option to cooperative societies to be taxed at 22% + 10% surcharge and 4% cess with no exemption/deductions.
    • Cooperative societies exempted from Alternate Minimum Tax (AMT) just like Companies are exempted from the Minimum Alternate Tax (MAT).
  • Tax concession for foreign investments:
    • 100% tax exemption to the interest, dividend and capital gains income on investment made in infrastructure and priority sectors before 31st March, 2024 with a minimum lock-in period of 3 years by the Sovereign Wealth Fund of foreign governments.
  • Affordable housing:
    • Additional deduction up to Rs. 1.5 lakhs for interest paid on loans taken for an affordable house extended till 31st March, 2021.
    • Date of approval of affordable housing projects for availing tax holiday on profits earned by developers extended till 31st March, 2021.

Tax Facilitation Measures

  • Instant PAN to be allotted online through Aadhaar.
  • ‘Vivad Se Vishwas’ scheme,with a deadline of30th June, 2020, to reduce litigations in direct taxes:
    • Waiver of interest and penalty - only disputed taxes to be paid for payments till 31st March, 2020.
    • Additional amount to be paid if availed after 31st March, 2020.
    • Benefits to taxpayers in whose cases appeals are pending at any level.
  • Faceless appeals to be enabled by amending the Income Tax Act.
  • For charity institutions:
    • Pre-filling in return through information of donations furnished by the done.
    • Process of registration to be made completely electronic.
    • Unique registration number (URN) to be issued to all new and existing charity institutions.
    • Provisional registration to be allowed for new charity institutions for three years.
    • CBDT to adopt a Taxpayers’ Charter.
  • Losses of merged banks:
    • Amendments proposed to the Income-tax Act to ensure that entities benefit from unabsorbed losses and depreciation of the amalgamating entities.

Indirect Tax

  • GST:
    • Cash reward system envisaged to incentivise customers to seek invoice.
    • Simplified return with features like SMS based filing for nil return and improved input tax credit flow to be implemented from 1st April, 2020 as a pilot run.
    • Dynamic QR-code capturing GST parameters proposed for consumer invoices.
    • Electronic invoice to capture critical information in a centralized system to be implemented in a phased manner.
    • Aadhaar based verification of taxpayers being introduced to weed out dummy or non-existent units.
    • GST rate structure being deliberated to address inverted duty structure.
  • Customs Duties:
    • Customs duty raised on footwear to 35% from 25% and on furniture goods to 25% from 20%.
    • Basic customs duty on imports of news print and light-weight coated paper reduced from 10% to 5%.
    • Customs duty rates revised on electric vehicles and parts of mobiles.
    • 5% health cess to be imposed on the imports of medical devices, except those exempt from BCD.
    • Lower customs duty on certain inputs and raw materials like fuse, chemicals, and plastics.
    • Higher customs duty on certain goods like auto-parts, chemicals, etc. which are also being made domestically.
  • Trade Policy Measures
    • Customs Act being amended to enable proper checks of imports under FTAs.
    • Rules of Origin requirements to be reviewed for certain sensitive items.
    • Provisions relating to safeguard duties to be strengthened to enable regulating such surge in imports in a systematic way.
    • Provisions for checking dumping of goods and imports of subsidized goods being strengthened.
    • Suggestions for reviews of exemptions from customs duty to be crowd-sourced.
  • Excise duty proposed to be raised on Cigarettes and other tobacco products, no change made in the duty rates of bidis.
  • Anti-dumping duty on PTA abolished to benefit the textile sector.

Unprecedented Milestones and Achievements of Indian Economy

  • India now the fifth largest economy of the world.
  • 7.4% average growth clocked during 2014-19 with inflation averaging around 4.5%.
  • 271 million people raised out of poverty during 2006-16.
  • India’s Foreign Direct Investment elevated to US$ 284 billion during 2014-19 from US$ 190 billion during 2009-14.
  • Central Government debt reduced to 48.7% of GDP (March 2019) from 52.2% (March 2014).
  • Two cross-cutting developments:
    • Proliferation of technologies (Analytics, Machine Learning, robotics, Bio-informatics and Artificial Intelligence).
    • Highest ever number of people in the productive age group (15-65 years) in India.
  • GST removed many bottlenecks in the system.

Future Aim for sustaining India’s unique global leadership, driven by Digital Revolution

  • Seamless delivery of services through Digital Governance.
  • Improvement in physical quality of life through National Infrastructure Pipeline.
  • Risk mitigation through Disaster Resilience.
  • Social security through Pension and Insurance penetration.

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