New Delhi, February 1: The Finance Minister today presented the Union Budget for the financial year 2017-2018. The budget had several key highlights like the lowering of the income tax percentage on income between Rs 2,50,000 and Rs 5,00,000 by half, the withdrawal of the service tax on e railway tickets from IRCTC and incentives on the use of BHIM app among others. However, a visible push in this year’s budget was with respect to the manufacturing sector in the country.
Here are 15 key incentives that the government has extended to industries in the country:
The government has announced its proposal to enhance digital connectivity across the country by allocating up to Rs 10,000 crore for the Bharat Net project. The Finance Minister today said, “Under the Bharat Net, optical fibre has been laid in 1,55,000 km. I have stepped up allocation for Bharat Net project to Rs 10,000 crore in 2017-18 and by the end of 2017-18, high-speed broadband on optical fibre will be available in more than 1.5 lakh gram panchayats with hotspots and access to digital services at a low tariff.”
The government believes that spectrum auctions have removed the spectrum scarcity in the country. “This will give a major fillip to mobilising broadband and Digital India, for the benefit of people living in rural areas,” the Finance Minister pointed out.
Other key areas of focus of the government include housing for the poor; relief to farmers; credit support to MSMEs; encouragement to digital transactions; assistance to pregnant women and senior citizens; and priority to Dalits, tribals, backward classes and women under the Mudra Yojana. These incentives are sure to boost the entrepreneurial spirit within the country.
The transport infrastructure has always remained a hurdle for the development of manufacturing in the country. In order to diminish the problem, the government has announced that railways have set up joint ventures with 9 State Governments. 70 projects have been identified for construction and development.Further, the Finance Minister said, “A beginning has been made with regard to station redevelopment. At least 25 stations are expected to be awarded during 2017-18 for station redevelopment. 500 stations will be made differently abled friendly by providing lifts and escalators. 78. It is proposed to feed about 7,000 stations with solar power in the medium term. A beginning has already been made in 300 stations. Works will be taken up for 2,000 railway stations as part of 1000 MW solar mission.”
The government has worked out a specific programme for the development of multi-modal logistics parks, together with multi-modal transport facilities, that will be drawn up further and implemented.
Speaking on the developments of the transportation sector as a whole, including rail, roads, shipping, the finance minister said, “I have provided ` 2,41,387 crores in 2017-18. This magnitude of investment will spur a huge amount of economic activity across the country and create more job opportunities.”
Explaining the importance of the telecom sector as an important component of the infrastructure eco system and its importance to industries, Jaitley said,”The recent spectrum auctions have removed spectrum scarcity in the country. This will give a major fillip to mobile broadband and Digital India for the benefit of people living in rural and remote areas.” (ALSO READ: Budget 2017: Full text of Arun Jaitley’s Budget speech in the Parliament)
For strengthening the Energy sector, the Government has decided to set up Strategic Crude Oil Reserves. In the first phase, 3 such Reserves facilities have already been set up. In the second phase, the finance minister clarified that it is proposed to set up caverns at 2 more locations, namely, Chandikhole in Odisha and Bikaner in Rajasthan. He added, “This will take our strategic reserve capacity to 15.33 MMT. In solar energy, we now propose to take up the second phase of Solar Park development for additional 20,000 MW capacity.”
Emphasising the need to boost electronics manufacturing in the country, Jaitley said, “We are also creating an eco-system to make India a global hub for electronics manufacturing. Over 250 investment proposals for electronics manufacturing have been received in the last 2 years, totalling an investment of ` 1.26 lakh crores. A number of global leaders and mobile manufacturers have set up production facilities in India. I have therefore exponentially increased the allocation for incentive schemes like M-SIPS and EDF to ` 745 crores in 2017-18. This is an all-time high.”
While the government has already undertaken substantive reforms in FDI policy in the last two years. ArunJaitley has said, “The Foreign Investment Promotion Board (FIPB) has successfully implemented e-filing and online processing of FDI applications. We have now reached a stage where FIPB can be phased out. We have therefore decided to abolish the FIPB in 2017-18. A roadmap for the same will be announced in the next few months. In the meantime, further liberalisation of FDI policy is under consideration and necessary announcements will be made in due course.”
A Bill will is expected to be introduced to streamline institutional arrangements for resolution of disputes in infrastructure related construction contracts, PPP and public utility contracts. The finance minister today announced in the Lok Sabha, “After extensive stakeholders’ consultations, we have decided that the required mechanism would be instituted as part of the Arbitration and Conciliation Act 1996. An amendment Bill will be introduced in this regard.”
The Government will put in place a revised mechanism and procedure to ensure time bound listing of identified CPSEs on stock exchanges. The disinvestment policy announced in the last budget will continue.
Speaking on the point of funding for various startups and industries, Jaitley said, “The Pradhan Mantri Mudra Yojana has contributed significantly to funding the unfunded and the underfunded. Last year, the target of ` 1.22 lakh crores was exceeded. For 2017-18, I propose to double the lending target of 2015-16 and set it at ` 2.44 lakh crores. Priority will be given to Dalits, Tribals, Backward Classes, Minorities and Women.”
Continuing on the same subject, Jaitley added, “The Stand Up India scheme was launched by our Government in April 2016 to support Dalit, Tribal and Women entrepreneurs to set up greenfield enterprises and become job creators. Over 16,000 new enterprises have come up through this scheme in activities, as diverse as food processing, garments, diagnostic centres, etc.”
The government has said that the digital payment infrastructure and grievance handling mechanisms shall be strengthened. The focus would be on rural and semi urban areas through Post Offices, Fair Price Shops and Banking Correspondents. Steps would be taken to promote and possibly mandate petrol pumps, fertilizer depots, municipalities, Block offices, road transport offices, universities, colleges, hospitals and other institutions to have facilities for digital payments, including BHIM App. Further, a proposal to mandate all Government receipts through digital means, beyond a prescribed limit, is under consideration.
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