Key Takeaways From Budget 2022
From Rs 5.54 lakh crore to Rs 7.50 lakh crore, the target for capital expenditure (capex) grew by 35.4%. The FM said that India's GDP growth in FY23 is the highest of all major economies, and we are now in a strong position to deal with any challenges that come our way. According to her, the goal is to complement macro-growth with micro-all-inclusive welfare, digital economy and fintech, tech-enabled development, energy transition, and climate action. She also mentioned that ECLGS cover has grown by Rs 50,000 to Rs 5 lakh crore. In this year's budget, the top priorities are: PM Gati Shakti; inclusive development; productivity enhancement; sunrise opportunities; energy transition; climate action; She added that productivity-linked incentive schemes in 14 sectors have been very well-received. Investment intentions worth Rs 30 lakh crore have been made. Economic growth is getting a boost from public investment and capital spending. Taxes Income from digital assets is to be taxed at 30% and except for the cost of buying a digital asset, no other deductions will be made. The loss from transactions of digital assets cannot be set off from any other income. Digital asset gifts like cryptocurrency gifts will be taxed at the receiver's end. If taxpayers have made an error while filing their returns, they can not file an updated return within two years from the year of assessment. The alternate minimum tax for cooperative societies has been cut down to 15% with surcharges being reduced to 7% for those with incomes between INR 1 crore to INR 10 crores. Tax deduction on employers contribution to NPS has been increased to 14%. Jobs ECLGS has been extended till March 2023 and the Government hopes to add 60 lakh jobs in the next 5 years. A digital ecosystem for skilling and making money will be launched soon. This will help people learn new skills, re-skill, and up-skill through online training. API-based skill credentials, payment layers, and other tools will help people find jobs and opportunities. Infrastructure National highways will be expanded by 25,000 kms in the upcoming financial year. The Desh stack e-portal will be launched to promote digital infrastructure. Air India's strategic ownership transfer has been completed. Four multi-modal national parks will be built in the next two years. One product, one railway station will be promoted with 400 new Vande Bharat trains being introduced. There will be a PM Gatishakti master plan for expressways next year. There will be 100 PM Gati Shakti terminals built in the next three years. Over the medium term, the government will invest in infrastructure and use the Gati Shakti tech platform to modernise it. This will help the economy move forward, and it will lead to more jobs and opportunities for the youth. Housing And Urban Planning In 2022-23, 80 million houses will be finished for PM Awas Yojana beneficiaries; 60,000 homes in rural and urban areas will be chosen as beneficiaries of the PM Awas Yojana. 60,000 crore has been set aside to make sure that 3.8 million households had access to tap water. A high-level committee of urban planners and economists will be set up to make recommendations on urban city building. Five of the existing academic institutions for urban planning are to be declared as Centre for Excellence with an endowment fund of INR 250 crores. New modern building by-laws are to be introduced. The government is also going to push for public transport usage in urban areas. MSMEs and Startups A five-year, Rs 6,000-crore scheme to rate MSMEs will be implemented. The reach of MSMEs such as Udyam, e-shram, NCS, and Aseem portals would be widened and they'll now act as portals with live organic databases, offering G-C, B-C, and B-B services including credit facilitation and expanding entrepreneurial opportunities. A fund with blended capital has been raised under NABARD's co-investment approach to finance agriculture and rural enterprise startups for the farm product value chain An expert group will be formed to recommend steps to help attract investment after PE/VC invested Rs 5.5 lakh crore in a startup. Agriculture The government would spend Rs 2.37 lakh crore on wheat and paddy procurement under the MSP programme The International Year of Millets has been declared for 2022-23 Small farmers and MSMEs will benefit from new rail products. To reduce imports, a more rationalised plan to boost domestic oilseed production will be implemented. Kisan Drones will be used for crop assessment, land records, and insecticide spraying and are expected to drive a wave of technology in the agricultural sector. INR 44,605 crores have been allocated for the linking of Ken Betwa river. Five river linkages have had their draught DPRs has also been finalised. Along the Ganga river corridor, natural farming will be promoted. Ministries for procurement will create an entirely paperless, e-billing system and farmers will be given financial assistance to start agroforestry operations. Electric Vehicles A battery swapping policy will be developed to allow EV charging stations for automobiles. The private sector will be encouraged to develop sustainable and innovative business models for battery and energy as a service, thereby improving EV ecosystem efficiency. Education States will be encouraged to revise agricultural university curricula to meet the needs of natural, zero-budget, and organic farming, as well as modern-day agriculture. The PM eVIDYA's 'one class, one TV channel' programme will be expanded from 12 to 200 TV channels, allowing all states to provide supplementary education in regional languages for classes 1 to 12. A digital university will be established to provide education; it will be built on a hub-and-spoke model. A 1-Class-1-TV Channel will be implemented to provide supplementary education to children in order to compensate for the loss of formal education due to Covid. Finance and inclusion Rs 1 lakh crore in financial assistance will be provided to states to catalyse investments in 2022-23. RBI proposes to introduce Digital Rupee using blockchain technology in 2022-23. The core banking system will be implemented in all 1.5 lakh post offices, enabling financial inclusion and account access via net banking, mobile banking, and ATMs, as well as providing online transfer of funds between post office accounts and bank accounts. This will be especially beneficial to farmers and senior citizens in rural areas, allowing for interoperability and financial inclusion. Amendments to the IBC to improve the efficiency of the resolution process. The government will also facilitate the resolution of cross-border insolvencies and expedite the voluntary closure of businesses. To encourage digital payments, scheduled commercial banks will establish 75 digital banks in 75 districts. An international arbitration centre will be established to facilitate faster dispute resolution. According to FM, a world-class university will be permitted in the GIFT IFSC, free of domestic regulation. Healthcare An open platform for the national digital health ecosystem will be launched, which will include digital registries of health providers and facilities, a unique health identity, and universal access to health facilities. A National Tele Mental Health Program will be launched to provide mental health counselling. Telecom A spectrum auction will be held in 2022 to prepare for the 5G rollout. A design-led manufacturing scheme will be launched as part of the PLI scheme to enable affordable broadband and mobile communication in rural and remote areas. A portion of the USO Fund will be used for R&D and technology advancement and contracts for laying optical fibre in villages will be awarded under the BharatNet PPP project in 2022-23. A data centre and an energy storage system will also be designated as infrastructure, allowing for easy financing. Women and Children Recognizing the significance of 'Nari Shakti,' three schemes will be launched to provide integrated development for women and children, including the upgrade of 2 lakh Anganwadis to improve child health. Ease of Businesses 75,000 compliances have been eliminated, and 1,486 union laws have been repealed to make doing business easier. Corporate voluntary exit will be reduced from two years to six months. Defence The government has committed to reducing imports and promoting self-reliance in the defence sector; 68% of capital for the defence sector will be earmarked for local industry and 25% of the defence R&D budget will be made available to industry, startups, and academia. Through the SPV model, private companies will be encouraged to design and develop military platforms and equipment in collaboration with DRDO and other organisations. In 2022-23, the domestic industry will receive 68 per cent of the defence capital procurement budget (up from the 58 per cent last fiscal). Railways 400 new-generation Vande Bharat trains will be manufactured over the next three years, and a 2,000-kilometer rail network will be brought under KAWACH for safety and capacity augmentation. Climate Change and Net Zero Energy Sovereign green bonds will be included in the government's borrowing programme in this fiscal year and the proceeds will be used for public-sector projects Four coal gasification pilot projects will be established and PLI will receive an additional allocation of Rs 19,500 crore for the production of high-efficiency solar modules. Travel E-Passports with embedded chips will be issued in 2022-23 for ease of overseas travel.