New Delhi: Union Finance Minister Arun Jaitley on Monday presented Union Budget 2016 and focused on SC/ST entrepreneurs, farmers, rural economy, highways and MNREGA.
Jaitley, during his Budget speech, emphasised that at a time when global economy was goi9ng through a lean phase, India has still emerged as a bright spot.
“We need to prioritise our expenditure, given recommendations of #7thCPC and #OROP implementation. We also need to have prudent fiscal policy, raise domestic demand and carry out reforms. Government's focus is on the rural and social sectors, infrastructure and recapitalization of banks,” Jaitley said.
Jaitley said, “Pradhanmantri Krishi Sinchaai Yojna was strengthened and implemented in mission mode. The aim is to double the income of farmers in five years. Rs. 35,984 crores total allocation for farmers' welfare. A dedicated irrigation fund worth Rs 20,000 crore to be initiated under National Bank for Agriculture and Rural Development (NABARD)”.
He said the government had targeted agriculture credit of Rs 8.5 lakh crore in 2015-16, which was being enhanced to Rs 9 lakh crore in the next fiscal. He also said that Rs 19,000 crore will be allocated for rural roads development programme.
Overall, Rs 87,765 crore was being allocated for rural development as a whole.
At the same time, Rs 35,984 crore was being allocated for agriculture in the next fiscal. This apart, the outlay under the job guarantee programme was being enhanced to Rs 38,500 crore. These enhanced allocations are capable of transforming villages and towns, Jaitley said.
Giving a big boost to UPAs’ job scheme MGNREGA, a total of Rs 38,500 crore was allotted to the scheme in Budget 2016.
Jaitley said that there was also the need to spread digital literacy in rural areas. In addition, Rs.8,500 crore was being allotted towards rural electrification, targeting 100 percent rural electrification by May 1, 2018.
The government also proposed 100% FDI through FIPB route in food products produced and marketed in India.
The Finance Minister also mentioned that the government has set a target of 10,000 kms of national highway and upgrade of 50,000 kms of state highways in 2016/17. Also, 85% of stalled road projects were back on track.
The Union Minster also mentioned that Union cabinet has approved #StandUpIndia scheme to encourage SC & ST entrepreneurs. SC/ST hub to be constituted under Ministry of Micro, Small and Medium Enterprises (MSME) ministry to encourage SC/ST entrepreneurship.
A higher education financing agency will now be set up, with a fund of 1000 crores. Also around 62 new Navodya Vidyalayas will be opened in uncovered districts under Sarva Siksha Abhiyaan.
Government will pay EPF contribution of 8.33% for all new employees for first three years.
In his third general budget, Jaitley gave relief to small tax payers. He also bought relief to people living in rented houses who will now be eligible for deductions of up to Rs 60,000 -- up from Rs 24,000. He also said the ceiling of tax rebate for people with income up to Rs 500,000 per annum was being raised to Rs 5,000 from the present Rs 2,000.
However, larger tax payers were not that fortunate, as the government raised income tax surcharge from 12% to 15% for incomes exceeding Rs 1 crore per annum.
Due to increase in service tax from 14.5% to 15%, consumers will now have to spend more money for entertainment, gold, branded clothes and cars. However, service tax will be exempted for services under the Deen Dayal Gram Jyoti Yojana.
The government also introduced 10-15% excise duty on tobacco to discourage use of tobacco products except beedis.
The government will also be providing LPG connection in the name of women members of poor household.
Jaitley also said that the fiscal deficit target of 3.9 % of GDP for the current fiscal will be met, even as the target for next year has been fixed at 3.5%. "Prudence lies in adhering to fiscal targets," he said.
“Despite a slowdown in exports, India's growth has expanded 7.5%. Also foreign exchange reserves were robust. Indian growth is at an extraordinary high", Jaitley said.
The minister also said that the government was fully committed to remove black money from the economy. Jaitley said that the government was committed to increase investment in asset reconstruction companies and measures to promote affordable housing.
Focusing on one of Prime Minister Narendra Modi’s flagship schemes, Jaitley announced Rs 9,000 crore to for Swachh Bharat Abhiyaan.
Recapitalization of banks also to be done during next fiscal year," he said, as much concern have emerged over the quantum of exposure of Indian scheduled banks in terms of gross non-productive assets, re-cast loans and write-offs, which amounts to Rs.9.5 lakh crore.
He said the nine pillars of this year's budget will be: agriculture, social programmes, rural development, education with skill development, infrastructure, financial reforms, policy reforms in terms of ease of doing business, fiscal discipline and tax reforms.
On health, a new scheme will provide medical cover up to Rs.1 lakh per family, the Finance Minister said.
(With inputs from IANS)