Union Budget 2021 was presented by the Union Finance Minister Nirmala Sitharaman on February 1st 2021. The union budget has ramped up the reforms in the healthcare and infrastructure sector. On the income tax slabs front, no changes have been made. Let us talk more about what the Union Budget contained.
Finance Minister Nirmala Sitharaman started with mentioning six pillars on which the budget proposal has been framed. Six pillars are health and well being, financial capital and infrastructure, inclusive development of aspirational India, innovation and R&D, minimum government and maximum governance.
Fiscal Numbers FY21
- Gross expenditure is estimated at Rs 34.5 lakh crore
- Capital expenditure at Rs 4.39 lakh crore
- Fiscal deficit is estimated at 9.5% of GDP
Fiscal Number FY22
- Gross expenditure estimated at Rs 34.83 lakh crore
- Capex estimated at Rs 5.54 lakh crore
- Fiscal deficit estimated at 6.8% of GDP
- Market borrowing estimated at 12 lakh crore
In the Budget 2021, the Government has announced the completion of 11,000 kilometer of roads. Other than that new road construction of up to 8,500 kilometer will also be completed by March 2022. The finance minister has also announced the road construction projects in poll bound states like Tamil Nadu, West Bengal, Assam and Kerala. For the ports and highways development, the budget has set aside Rs 1,18,101 crore.
The government has set an ambitious target of Rs 1.75 lakh crore for the disinvestment. In the union budget for 2021-22, finance minister Nirmala Sitharaman announced about the strategic sale of IDBI Bank, Container corporation, shipping corporation, BPCL, Pawan hans, Neelachal Ispat Nigam and Air India.
Moreover, the government has also decided to privatise the two public sector banks and one general insurance company.
There has not been any change in the income tax slabs in this Union Budget. However, senior citizens above 75 years will not have to file ITR provided their income source is only pension. Further, a dispute resolution committee has been formed for the small taxpayers. Anyone with taxable income up to Rs 50 lakh and disputed income up to Rs 10 lakh can approach the dispute resolution committee.
Preventive and curative healthcare sector remained focus area in the Union Budget with the allocation increasing to 137% with the new allocation of Rs 2,23,856 crore. Additionally, Rs 35,000 crore has been allocated to COVID-19 vaccination expenditure.
Development Financial Institution
Government has also announced setting up DFI setting aside Rs 20,000 crore for the same. The lending portfolio is targeted at Rs 5 lakh crore in 3 years. Further, there is also a mention of National monetization pipeline for brownfield projects.
Banking and Small Companies
In the Union budget the government has announced the allocation or Rs 20,000 crore for the recapitalization of the Public sector banks. Additionally, the finance minister has also announced to revise the definition of small companies under the Companies Act, 2013 as they plan to increase the threshold for capitalization.
The budget has announced agricultural credit of Rs 16.5 lakhs for FY22. Moreover, the provision for the rural infra development fund will increase to Rs 40,000 crore compared to R 30,000 crore.