Union Budget 2014-15
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NDA Government's maiden Budget. Presented by Finance Minister Arun Jaitley on Jul 10, 2014.
Transcript of Union Budget 2014-15
- UNION BUDGET 2014-15 JAITLEY JOURNEY 1 Prepared by: AGGRAJ SHARMA
- On May 16, the BJP came to power with 282 seats, the most won by a single party in 30 years. It was a sweeping mandate for change, jobs, growth. Does the Budget reflect those aspirations?
- The Three Goals Presenting the first Budget of BJP government, Finance Minister Arun Jaitley stuck to the troika of restoring the pace of growth, containing inflation and concentrating on fiscal consolidation.
- Focus on Fiscal Consolidation NDA governments maiden Budget retains the ambitious target of 4.1% of the GDP for fiscal deficit in FY15. Fiscal deficit would be brought down to 3.6% in FY16 and 3% by FY17. Revenue deficit will be lowered to 2.9% by FY15.
- The Budget depends heavily on raising revenues by bringing up the tax to GDP ratio to 10.6 per cent in FY14 from 10.1% in FY13. Finance Minister says: We cannot spend beyond our means.
- Growth GDP growth in 2014/15 estimated at 5.4-5.9 percent year-on-year. Aims for sustained growth of 7-8 percent in the next 3-4 years. Nominal GDP growth in 2014/15 expected to be 13.4 percent year-on- year. Must usher in policies for higher growth, lower inflation.
- Taxation High level committee to decide on cases of retrospective amendments. Investment allowance threshold revised to 25 crore from 100 crore at the rate of 15% to boost manufacturing; to be applicable upto March 31, 2007. Investment-linked deduction for two new sectors slurry pipelines for iron ore transportation, and semiconductor wafer fabrication manufacturing.
- Tax holiday for 10 years extended to power undertakings that begin generation, distribution and transmission by March 31, 2017. DTC to be reviewed. 60 Aayakar Seva Kendras to be opened during 2014-15. Color picture tubes to be exempt from basic customs duty. Excise duty on footwear reduced from 12% to 6%.
- Imposes 10 percent customs duty on some telecom products. Introduces uniform customs duty on all types of coals. Raises export tax on bauxite to 20 percent from 10 percent. The government has set a direct tax collection target of 7,58,421 crore for 2014-15.
- Personal Finance Announcement to raise the exemption limit for individuals from 2 lakh to 2.5 lakh and also for senior citizens from 2.5 lakh to 3 lakh. Announcement to raise the deduction limit under Section 80C from 1 lakh currently to 1.5 lakh. Investment ceiling in the tax-free PPF scheme has been raised to 1.5 lakh from 1 lakh.
- Transport It is time to reaffirm our commitment to a better and more energetic PMGSY under the dynamic leadership of Prime Minister Narendra Modi. I propose to provide a sum of 14,389 crore. - Arun Jaitley, Finance Minister
- Employment/Education 10,000 crore incubation fund, thrust on more jobs. The budget also unveiled a national multi-skill programme called Skill India that would equip the youth with skill, with an emphasis on employability and entrepreneur skills.
- India today needs a boost for job creation. Our manufacturing sector in particular needs a push for job creation. - Arun Jaitley, Finance Minister
- Energy Plan to replicate Gujrats 24X7 power supply model by segregating distribution infrastructure. Deen Dayal Upadhyay Gram Jyoti Yojana for feeder separation will be launched to augment power supply to the rural areas and a sum of 500 crore will be given by the government.
- Manufacturing Defence, Insurance, Construction get major FDI boost. FDI in Defence and Insurance sector raised to 49%. The government is looking at Defence production as a key player in its strategy to revive manufacturing.
- In line with BJP manifesto to build smart cities, FDI norms in the construction sector have been lowered by half to $5 million and the minimum built-up area has been reduced to 20,000 square meters from the existing 50,000 square meters.
- Social Sector Two years on, free drug scheme takes center-stage in health plan. 12 more government medical colleges will be set up and dental facilities will be provided at all hospitals. All six new AIIMs in Jodhpur, Bhopal, Patna, Rishikesh, Bhubaneshwar and Raipur have become functional.
- Four more AIIMs-like institutions in Andhra Pradesh, West Bengal, Vidarbha and Poorvanchal. Health sector gets 30,645 crore; Jaitley promises health for all, gives fillip to rural healthcare. Department of Health Research gets 726 crore. Department of AIDS control gets 1,785 crore.
- Five new IITs and five more IIMs. 12% increase in overall allocation for education. Increased from 74,621 crore to 83,771 crore.
- Agriculture/Defence Announcement for setting up of two centers of excellence in agricultural research (Assam and Jharkhand), two agricultural universities (Andhra Pradesh and Rajasthan), two horticulture universities (Telangana and Haryana) and a dedicated Kisan TV for farmers. 5,000 crore extra for Defence, but mostly for R&D.
- Budget Highlights 1. Fiscal deficit target 3.6% of GDP for FY16, 3% for FY17. 2. Subsidy regime, including food and petroleum subsidies, to be overhauled. 3. High-level panel to interact with trade, industry for tax law reforms. 4. FDI cap in defence raised to 49%. 5. FDI cap in insurance sector raised to 49% from 26%.
- 6. 7,060 crore allotted for developing 100 Smart Cities. 7. For Smart Cities, built-up area cut from 50,000 sq mts to 20,000 sq mts. 8. Manufacturing units allowed to sell products through retail. 9. Electronic Travel Authorisation at 9 airports. 10. Skill India, a skill programme to improve employability of youths, to be launched.
- 11. 1,000 crore Pradhan Mantri Krishi Sinchayee Yojana to improve access to irrigation introduced. 12. Every household to have total sanitation by 2019 the 150th birth anniversary of Mahatma Gandhi through Swachh Bharat Abhiyan. 13. Shyama Prasad Mukherji Rurban Mission to provide urban amenities in rural areas; through PPP model. 14. 200 crore for Sardar Patels Statue of Unity in Gujarat.
- 15. 500 cr Deen Dayal Upadhyaya Gram Jyoti Yojana for rural electricity. 16. Institutes for Universal Inclusive Design and Mental Health Rehabilitation to be set up. 17. Centre for Disability Sports to be set up. 18. 15 new Braille presses coming, 10 existing presses to be modernised. 19. Currency notes to be printed with Braille-like signs.
- 20. 150 crore for safety of women in large cities. 21. 14,389 crore for Pradhan Mantri Gram Sadak Yojana. 22. MGNREGA to continue, emphasis on asset creation. 23. 8,000 crore for rural housing. 24. Neeranchal watershed initiative. 25. 3,600 crore for National Rural Drinking Water Programme. 26. Health for All: Free Drug Service and Free Diagnosis Service.
- 27. 28,635 crore for Sarva Shiksha Abhiyan. 28. 4,966 crore for Rashtriya Madhyamik Shiksha Abhiyan. 29. 500 crore for Pandit Madan Mohan Malviya New Teachers Training Programme. 30. 100 crore for setting up virtual classrooms, online courses. 31. 500 crore for Digital India initiative covering villages.
- 32. A comprehensive strategy to tackle malnutrition with timelines, targets. 33. A programme for skill upgrade for minorities in ancestral arts. 34. 100 crore to modernise madarsas. 35. 100 crore for scheme to provide every farmer a soil health card. 36. 56 crore to set up 100 Mobile Soil Testing Laboratories. 37. Focus on technology-driven second green revolution.
- 38. Push for the Amritsar-Kolkata industrial master plan. 39. A Trade Facilitation Centre and Crafts Museum to promote handloom products of Varanasi. 40. 4,200 cr Jal Marg Vikas project on Ganga to connect Allahabad to Haldia. 41. 8,500 km of National Higways. 42. 500 cr for Ultra Mega Solar Power Projects in Rajasthan, Gujarat, Tamil Nadu, and Ladakh.
- 43. 400 cr for solar power driven agri- pump sets and water pumping stations. 44. 100 crore to develop 1 MW Solar Parks near canals. 45. 100 crore for war memorial and museum in Delhi. 46. 500 crore to develop five tourist circuits with themes. 47. Sarnath-Gaya-Varanasi Buddhist circuit with world-class tourist amenities.
- 48. 2,037 crore for Int