Key Highlights of Union Budget 2019-20

10-point Vision for the decade

  • Building Team India with Jan Bhagidari: Minimum Government Maximum Governance.
  • Achieving green Mother Earth and Blue Skies through a pollution-free India.
  • Making Digital India reach every sector of the economy.
  • Launching GaganyanChandrayan, other Space and Satellite programmes.
  • Building physical and social infrastructure.
  • Water, water management, clean rivers.
  • Blue Economy.
  • Self-sufficiency and export of food-grains, pulses, oilseeds, fruits and vegetables.
  • Achieving a healthy society via Ayushman Bharat, well-nourished women & children, the safety of citizens.
  • Emphasis on MSMEs, Start-ups, defence manufacturing, automobiles, electronics, fabs and batteries, and medical devices under Make in India.

Towards a 5 Trillion Dollar Economy

  • “People’s hearts filled with Aasha (Hope), Vishwas (Trust), Aakansha (Aspirations)”, says FM.
  • Indian economy to become a 3 trillion dollar economy in the current year.
  • The government aspires to make India a 5 trillion dollar economy.
  •  “India Inc. is India’s job-creators and nation’s wealth-creators”, says FM.
  • Need for investment in:
    • Infrastructure.
    • Digital economy.
    • Job creation in small and medium firms.
  • Initiatives to be proposed for kick-starting the virtuous cycle of investments.
  • Common man’s life changed through MUDRA loans for ease of doing business.
  • Measures related to MSMEs:
    • Pradhan Mantri Karam Yogi Maandhan Scheme
  • Pension benefits to about three crore retail traders & small shopkeepers with an annual turnover of less than Rs. 1.5 crore.
  • Enrolment to be kept simple, requiring only Aadhaar, bank account and a self-declaration.
    • Rs. 350 crore allocated for FY 2019-20 for 2% interest subvention (on fresh or incremental loans) to all GST-registered MSMEs, under the Interest Subvention Scheme for MSMEs.
    • Payment platform for MSMEs to be created to enable filing of bills and payment thereof, to eliminate delays in government payments.
  • India’s first indigenously developed payment ecosystem for transport, based on National Common Mobility Card (NCMC) standards, launched in March 2019.
  • Inter-operable transport card runs on RuPay card and would allow the holders to pay for bus travel, toll taxes, parking charges, retail shopping.
  • Massive push is given to all forms of physical connectivity through:
    • Pradhan Mantri Gram Sadak Yojana.
    • Industrial Corridors, Dedicated Freight Corridors.
    • Bhartamala and Sagarmala projects, Jal Marg Vikas and UDAN Schemes.
  • State road networks to be developed in the second phase of Bharatmala project.
  • The navigational capacity of Ganga to be enhanced via multi-modal terminals at Sahibganj and Haldia and a navigational lock at Farakka by 2019-20, under Jal Marg Vikas Project.
  • Four times increase in the next four years estimated in the cargo volume on Ganga, leading to cheaper freight and passenger movement and reducing the import bill.
  • Rs. 50 lakh crore investment needed in Railway Infrastructure during 2018-2030.
  • Public-Private-Partnership proposed for development and completion of tracks, rolling stock manufacturing and delivery of passenger freight services.
  • 657 kilometres of Metro Rail network has become operational across the country.
  • Policy interventions to be made for the development of Maintenance, Repair and Overhaul (MRO), to achieve self- reliance in the aviation segment.
  • Regulatory Roadmap for making India a hub for aircraft financing and leasing activities from Indian shores, to be paid by the Government.
  • The outlay of Rs. 10,000 crore for 3 years approved for Phase-II of FAME Scheme.
  •  Upfront incentive proposed on purchase and charging infrastructure, to encourage faster adoption of Electric Vehicles.
  • Only advanced-battery-operated and registered e-vehicles to be incentivized under FAME Scheme.
  • National Highway Programme to be restructured to ensure a National Highway Grid, using a financeable model.
  • Power at affordable rates to states ensured under ‘One Nation, One Grid’.
  • Blueprints to be made available for gas grids, water grids, i-ways, and regional airports.
  • High-Level Empowered Committee (HLEC) recommendations to be implemented:
    • Retirement of old & inefficient plants.
    • Addressing the low utilization of gas plant capacity due to paucity of Natural Gas.
  • Cross-subsidy surcharges, undesirable duties on open access sales or captive generation for industrial and other bulk power consumers to be removed under Ujjwal DISCOM Assurance Yojana (UDAY).
  • Package of power sector tariff and structural reforms to be announced soon.
  • Reform measures to be taken up to promote rental housing.
  • Model Tenancy Law to be finalized and circulated to the states.
  • Joint development and concession mechanisms to be used for public infrastructure and affordable housing on land parcels held by the Central Government and CPSEs.
  • Measures to enhance the sources of capital for infrastructure financing:
    • Credit Guarantee Enhancement Corporation to be set up in 2019-2020.
    • Action plan to be put in place to deepen the market for long term bonds with a focus on infrastructure.
    • Proposed transfer/sale of investments by FIIs/FPIs (in debt securities issued by IDF-NBFCs) to any domestic investor within the specified lock-in period.
  • Measures to deepen bond markets:
    • Stock exchanges to be enabled to allow AA rated bonds as collaterals.
    • User-friendliness of trading platforms for corporate bonds to be reviewed.
  • Social stock exchange:
    • Electronic fundraising platform under the regulatory ambit of SEBI.
    • Listing social enterprises and voluntary organizations.
    • To raise capital as equity, debt or as units like a mutual fund.
  • SEBI to consider raising the threshold for a minimum public shareholding in the listed companies from 25% to 35%.
  • Know Your Customer (KYC) norms for Foreign Portfolio Investors to be made more investor-friendly.
  • Government to supplement efforts by RBI to get retail investors to invest in government treasury bills and securities, with further institutional development using stock exchanges.
  • Measures to make India a more attractive FDI destination:
    • FDI in sectors like aviation, media (animation, AVGC) and insurance sectors can be opened further after the multi-stakeholder examination.
    • Insurance Intermediaries to get 100% FDI.
    • Local sourcing norms to be eased for FDI in Single Brand Retail sector.
  • Government to organize an annual Global Investors Meet in India, using National Infrastructure Investment Fund (NIIF) as an anchor to get all three sets of global players (pension, insurance and sovereign wealth funds).
  • The statutory limit for FPI investment in a company is proposed to be increased from 24% to sectoral foreign investment limit. Option to be given to the concerned corporate to limit it to a lower threshold.
  •  FPIs to be permitted to subscribe to listed debt securities issued by REITs and InvITs.
  • NRI-Portfolio Investment Scheme Route is proposed to be merged with the Foreign Portfolio Investment Route.
  • Cumulative resources garnered through new financial instruments like Infrastructure Investment Trusts (InvITs), Real Estate Investment Trusts (REITs), as well as models like Toll-Operate-Transfer (ToT), exceed Rs. 24,000 crore.
  • New Space India Limited (NSIL), a PSE, incorporated as a new commercial arm of Department of Space.
  • To tap the benefits of the Research & Development carried out by ISRO like the commercialization of products like launch vehicles, transfer to technologies and marketing of space products.

 

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