Union Budget 2022 Highlights
The Union Budget 2022 for the fiscal year 2022-23 focuses on accelerating the economy, expanding business opportunities, and creating six million new jobs. The most emphasized sectors are Agriculture, healthcare, small and medium-sized businesses, and infrastructure sectors.
FM Nirmala Sitharaman announced her fourth Union Budget on 1st Feb 2022. All in all the budget was a balanced budget to fulfill all the expectations, especially amid the Covid-19 situation.
You may get confused with the huge budget. To simplify & make you understand better here are the key highlights that you must know.
- The government has already started The National Bank for Financing Infrastructure and Development (NaBFID) and National Asset Reconstruction Compan.
- PM GatiShakti Master Plan for Expressways will be created in 2022-23 to facilitate faster movement of people and goods.┬
- The National Highways network will be expanded by 25,000 km in 2022-23. `┬
- Rs. 20,000 crores will be mobilized through innovative ways of financing to complement the public resources.┬
- The data exchange among all mode operators will be brought on Unified Logistics Interface Platform (ULIP), designed for Application Programming Interface (API) for efficient movement of goods through different modes.
- Contracts for implementation of Multimodal Logistics Parks at four locations through PPP mode will be awarded in 2022-23.┬
- Railways will develop new products and efficient logistics services for small farmers and Small and Medium Enterprises.
- тАШOne Station-One ProductтАЩ concept will be promoted to help local businesses & supply chains.
- As a part of Atmanirbhar Bharat, 2,000 km of the network will be brought under Kavach, the indigenous world-class technology for safety and capacity augmentation in 2022-23.
- Four hundred new-generation Vande Bharat Trains will be developed and manufactured during the next three years.
- One hundred PM GatiShakti Cargo Terminals for multimodal logistics facilities will be developed during the next three years.┬
- The procurement of wheat in Rabi 2021-22 and the estimated procurement of paddy in Kharif 2021-22 will cover 1208 lakh metric tonnes of wheat and paddy from 163 lakh farmers, and `┬
- Rs. 2.37 lakh crore direct payment of MSP value to their accounts.┬
- Chemical-free Natural Farming will be promoted.
- Support will be provided for post-harvest value addition, enhancing domestic consumption, and branding millet products nationally and internationally.┬
- A rationalized and comprehensive scheme to increase the domestic production of oilseeds will be implemented.┬
- A scheme in the Public-private partnership model will be launched for the delivery of digital and hi-tech services to farmers.
- The Usage of тАШKisan DronesтАЩ will be promoted for crop assessment, digitization of land records, spraying of insecticides, and nutrients.┬
- A fund with blended capital, raised under the co-investment model, will be facilitated through NABARD to finance startups for agriculture & rural enterprise through support for FPOs, machinery for farmers on a rental basis at farm level, and technology including IT-based support
- Udyam, e-Shram, NCS, and ASEEM portals will be interlinked to provide live, organic databases, providing G2C, B2C, and B2B services and formalizing the economy, and enhancing entrepreneurial opportunities for all.┬
- Emergency Credit Line Guarantee Scheme (ECLGS) will be extended up to March 2023 and its guarantee cover will be expanded by ` 50,000 crores to the total cover of ` 5 lakh crore, with the additional amount being earmarked exclusively for the hospitality and related enterprises.┬
- The government will facilitate an additional credit of ` 2 lakh crore for Micro and Small Enterprises and expand employment opportunities by revamping the Credit Guarantee Trust for Micro and Small Enterprises (CGTMSE) scheme.
- Raising and Accelerating MSME Performance (RAMP) programme with an outlay of ` 6,000 crores over 5 years will be rolled out to help the MSME sector become more resilient, competitive, and efficient.
- Duty on umbrellas is being raised to 20 percent.
- Customs duty exemption is being extended for another year to provide relief to MSME secondary steel producers.┬
- Certain Antidumping and CVD on stainless steel and coated steel flat products, bars of alloy steel, and high-speed steel are being revoked.
- Digital Ecosystem for Skilling and Livelihood тАУ the DESH-Stack eportal тАУ will be launched.┬
- Startups will be promoted to facilitate тАШDrone ShaktiтАЩ through varied applications and for Drone-As-A-Service (DrAAS).
- тАШone class-one TV channelтАЩ programme of PM eVIDYA will be expanded from 12 to 200 TV channels enabling all states to provide supplementary education in regional languages for classes 1-12.┬
- In vocational courses, 750 virtual labs in science and mathematics, and 75 skilling e-labs for a simulated learning environment will be set up this year.┬
- High-quality e-content in all spoken languages will be developed for delivery through the internet, mobile phones, TV, and radio through Digital Teachers.┬
- A Digital University will be established with a personalized learning experience to provide world-class quality universal education to students.
- An open platform, for the National Digital Health Ecosystem, will be rolled out. It will consist of digital registries of health providers and health facilities, unique health identity, consent framework, and universal access to health facilities.┬
- National Tele Mental Health Programme will be launched with a network of 23 tele-mental health centers of excellence.
- Rs. 48,000 crores are allocated for the completion of 80 lakh houses for the identified eligible beneficiaries of PM Awas Yojana in both rural and urban areas.
- 56. The Central Government will promote affordable housing for the middle class and Economically Weaker Sections in urban areas.┬
- 100 percent of 1.5 lakh post offices will come on the core banking system enabling financial inclusion and access to accounts through 11 net banking, mobile banking, ATMs.
- SItharaman proposed to set up 75 Digital Banking Units (DBUs) in 75 districts of the country by Scheduled Commercial Banks.┬
- The financial support for the digital payment ecosystem announced in the previous Budget will continue in 2022-23.┬
- The government will promote the use of payment platforms that are economical and user-friendly.
- The issuance of e-Passports using embedded chips and futuristic technology will be rolled out in 2022-23 to enhance convenience for the citizens in their overseas travel.┬
- An AVGC (animation, visual effects, gaming, and comic) promotion task force will be set up to build domestic capacity for serving markets and the global demand.┬
- Spectrum auctions will be conducted in 2022 to facilitate the rollout of 5G mobile services by private telecom providers.┬
- A scheme for design-led manufacturing, as part of the Production Linked Incentive Scheme, will be launched to build a strong ecosystem for 5G.┬
- 5 percent of annual collections under the Universal Service Obligation Fund will be allocated to enable affordable broadband and mobile service proliferation in rural and remote areas.┬
- The contracts for laying optical fibre in all villages will be awarded under the Bharatnet project through PPP in 2022-23.┬
- The Special Economic Zones Act will be replaced with new legislation, enabling the states to become partners in тАШDevelopment of Enterprise and Service HubsтАЩ,┬а to optimally utilize the available infrastructure and enhance the competitiveness of exports.
- Exemptions are being provided on items such as embellishment, trimming, fasteners, buttons, zipper, lining material, specified leather, furniture fittings, and packaging boxes to incentivize exports.┬
- Duty is being reduced on certain inputs needed for shrimp aquaculture so as to promote its exports.┬
- An additional allocation of Rs. 19,500 crore for Production Linked Incentive for the manufacture of high-efficiency modules will be made to facilitate domestic manufacturing for the goal of 280 GW of installed solar capacity.
- An outlay for capital expenditure in the Union Budget is stepped up sharply by 35.4 percent from Rs. 5.54 lakh crore in the current year to Rs. 7.50 lakh crore in 2022-23.
- Sovereign Green Bonds will be issued for mobilizing resources for green infrastructure.
- The government will promote thematic funds for blended finance with the government share being limited to 20 percent and the funds being managed by private fund managers.
- Sitharaman proposed to introduce Digital Rupee, using blockchain and other technologies, to be issued by the Reserve Bank of India.┬
- Customs duty rates are calibrated to provide a graded rate structure to facilitate domestic manufacturing of wearable devices, hearable devices, and 28 electronic smart meters.┬
- The parts of the transformer of mobile phone chargers and camera lens of mobile camera module and certain other items have also been given duty concessions. . This will enable domestic manufacturing of high growth electronic items.
Gems and Jewellery┬
- Customs duty on cut and polished diamonds and gemstones is being reduced to 5 percent.┬
- A simplified regulatory framework shall be implemented by June this year to facilitate the export of jewelry through e-commerce.
- The customs duty on imitation jewelry is being prescribed in a manner that a duty of at least ` 400 per Kg is paid on its import to disincentives import of undervalued imitation jewelry.
- Customs duty on methanol, acetic acid, and heavy feedstocks for petroleum refining are being reduced.┬
- The duty is being raised on sodium cyanide for which adequate domestic capacity exists.
Budget 2022-23 Allocation
Budget Estimate For 2022-23
RS. ( тВ╣ in Crore )
Road Transport & Highways
Housing & Urban Affair
Women & Child Development
Labor & Employment
Commerce & Industry
Total Allocation of fund in Union Budget 2022-23 is for 102 Ministries/Departments.
What Indians were expecting in Budget 2022-23?тАЛ
Higher Finance Allotment to Pharma sector:
The National Health Policy 2017 calls for an increase in public spending on health care from 2.5-3 percent of GDP, as well as an increased budgetary allocation for R&D in the biopharmaceutical sector.
Strategies to reduce loan interest rates and improve the loan procurement procedure:
Under the Atmanirbhar Bharat Abhiyan, the government announced the ECGLS scheme to assist MSMEs during the initial lockdown days. The Budget is expected to provide additional support to MSMEтАЩs through initiatives that reduce interest rates on loans and improve the loan procurement process, assisting them on the road to recovery and subsequent business growth.
The present Customs Duty Concessions should be maintained:
The government should maintain the existing Customs Duty Concessions/ Benefits for Medications because, in the current environment, any termination would have a negative impact on the availability of such medicines at a reasonable price.
Dedicated Fund for Health Crises:
A separate dedicated central fund should be kept in place to cover the costs of drugs, equipment, and other essentials needed to control and respond to future health crises that may or may not be as severe as COVID -19.
Formulate a policy to incentivize investments for MSME sector:
In order to make the MSME sector mainly funded in the near future, the government may attempt to establish a strategy to incentivize investments. The act of incentivizing investments in the MSME sector will encourage far more investment in these companies.
Relaxation in taxes and duties to increase local manufacturing:
The government must revisit and reduce capital goods customs and taxes to encourage small businesses to invest and create more to speed up the Make-in-India and Made-for-India initiatives. The reduction in taxes and duties will encourage MSMEs to manufacture domestically, aligning with the Atmanirbhar Bharat campaign even more.
Equalization Levy Should Be Eliminated:
The equalization levy should be eliminated, and steps should be taken to make compliance easier and reduce tax litigation.
Standardization in the credit industry:
The government is expected to adopt a standard credit days period, particularly for the trade credit sector, to address one of the sector’s most significant issues: late payments.
Ease of Doing Business:
Additional steps should be taken to improve ‘Ease of Doing Business,’ with a focus on simplification and making the process more industry-friendly, with specific provisions for removing bottlenecks and other practical problems that taxpayers confront.┬
May raise the limit for medical insurance:
The rise in healthcare costs has led people to purchase health insurance. There has also been a considerable increase in public awareness, and many people are now purchasing medical insurance. To make it even higher, the government may raise the limit from 25,000 to 50,000.
Increase in the interest rate limit for house loans:
To enable the public to buy their dream home and support the real estate market, the government could consider raising the┬а limit of deduction of interest on home loans from 2 lac to 3 lac.
Section 80C and other comparable deductions should be increased:
For many years, it has been predicted that the maximum for these parts should be extended from 1.5 to 3.0 lacs, which would greatly aid in the increase of savings in the hands of many Indians.
Benefits in Income Tax Slab Rate:
The salaried class has high expectations from this budget to increase their net income, or income after taxes, and one way to do this is to provide direct relief on income up to 5 lac, i.e. no tax up to 5 lac, and further rate reductions on additional income, as well as surcharge reductions.
PM Modi's Remarks ahead of Union Budget 2022
Some Key Highlights of Past Year Budget 2021-22
The Union Budget 2021-22 introduced by the FM was the first-ever digital Union Budget and was an indicator to get India back on the road of recovery post an unprecedented pandemic.