New Delhi, Feb 1: Infrastructure, rural development – were at the centre of Finance Minister Arun Jaitley’s Union Budget 2017-18 that was presented in Parliament on Wednesday. In a budget that Jaitley called ‘historic’, the Finance Minister raised the Railways allocation, MNREGA allocation and many others considerably, also limiting donations to political parties and NGOs.
Jaitley began with highlighting that Budget 2017 contained three major reforms – the first being the advancement of the Budget to February 1 from March, second the merger of Rail and Union Budget, and third was doing away with a planned and non-planned classification of expenditure.
Jaitley’s budget was all about the welfare of farmers, rural areas, infrastructure, benefits of demonetisation, war against black money and checking tax defaulters. Skill India and rural healthcare also found a remarkable mention in the Finance Minister’s Budget speech.
Based on ‘Transform, Energise and Clean India’, Budget 2017-2018 was drafted around 10 themes. These are – Farmers, rural population, youth, poor and underprivileged, infrastructure, financial sector, digital economy, public service, prudent fiscal management, and tax administration.
For farmers, Jaitley said that his government aimed at increasing the farmer’s product and productivity. He proposed fixing the agricultural credit for 2017-2018 at Rs 10 lakh crore. The total allocation for rural, agricultural and allied sectors for 2017-18 has been taken up to record Rs 1,87,223 crore, up by 24 per cent. The coverage of Fasal Bima Yojana has been targeted to go up from 30 per cent of cropped area, to 40 per cent in 2017-18 and 50 per cent in 2018-19. The Corpus of Long Term Irrigation Fund in NABARD will also become Rs 40,000 crore rupees.
The biggest highlight of Arun Jaitley’s Budget for the rural India was increasing the allocation for MGNREGA from Rs 37,000 crore to Rs 48,000 crore, which is the highest ever for the scheme so far. The Budget also said 1 crore houses will be completed by 2019 for the homeless and those living in kutcha houses. Rural sanitation and health were also part of the Finance Minister’s Budget. He proposed converting health sub centres into Health and Wellness Centres. Achieving 100 per cent village electrification by May 2018, is also among the promises made by Jaitley.
For the Railways, the Finance Minister increased the budget allocation to Rs 1,31,000 crores. Biotoilets and solar powered railway stations are among the promises made by the Finance Minister. With respect to growing online transactions, the Finance Minister also proposed doing away with Service charge on e-ticketing on the IRCTC site and app. Being targeted over rail safety, Jaitley said that unmanned rail crossings will be done away with by 2020. A Rail safety fund with a corpus of Rs 100,000 will be created over a period of 5 years. For the roads, Jaitley proposed raising the allocation for National Highways from Rs 57,673 crores to Rs 64,000 crores.
As was being expected, the Finance Minister did make some changes in the Income Tax slabs. The tax on an income between Rs 2.5 to 5 lakh has been reduced to 5 per cent from 10 per cent. No tax will be levied on an income of up to Rs 3 lakh. Other proposals in the tax category included a surcharge of 10 per cent for those whose annual income is between Rs 50 lakh and Rs 1 crore and 15 per cent surcharge on income above Rs 1 crore per annum. The Income Tax for small companies with an annual turnover of up to Rs 50 crore has been reduced from 30 per cent to 25 per cent.
Promoting the government’s drive for ‘Cashless India’ Jaitley also proposed two schemes relating to the use of BHIM app. Jaitley said that schemes related to cashback and referral bonus will be implemented to promote the use of BHIM app, which now has 125 lakh users.
The government has been under attack from the Opposition saying it helped Kingfisher Chairman Vijay Mallya flee the country. In that context, Jaitley said that his government was considering on bringing a law allowing the government to confiscate the assets of tax defaulters fleeing the country. The Finance Minister’s Budget also included measures in limiting donations to NGOs and political parties. The cash donation received by a political party by one source has been limited to Rs 2,000. The limit for cash donations being received by an NGO has been reduced from Rs 10,000 to Rs 2,000.
For the youth, the Finance Minister announced an innovation fund to encourage innovation. He also proposed setting up of 100 skill centres across India under the Skill India mission. The Finance Minister has proposed two new AIIMS in Jharkhand and Gujarat. A National Testing Agency will also be established to conduct all entrance exams for higher education.
With more goodies for rural India and farmers, Finance Minister Arun Jaitley, it seems, has played it smart by not directly but in a way targeting the states going for elections. For full text of the Finance Minister’s Budget speech, click HERE