Budget 2019 Red 'bahi khata' instead of Briefcase

In a departure from legacy, Finance Minister, Nirmala Sitharaman arrived without a briefcase to present the budget donning the finance papers in a red 'bahi khata' (four-fold red cloth books of account, Indian style) instead, making a point the departure from slavery to the western culture is at hand.

The budget is fairly and evenly poised, raising hopes on some fronts, remarkable in some directions and reversionary in some aspects.

Finance Minister, Nirmala Sitharaman thanks taxpayers as responsible citizens for their valuable contribution through taxes for all-round development of the country.

Determined Efforts

Finance Minister Nirmala Sitharaman quoting Chanakya Neeti sutra said, 'Kaarya purusha kare na lakshyam sampa dayate'. Meaning with determined human efforts the task will surely be completed.

It took us over 55 years to reach $1 trillion dollar economy. But when the hearts are filled with hope, trust and aspiration, in just 5 years, we added $1 trillion.

She added, the Indian economy will grow to become a $3 trillion economy in the current year itself. It is now the sixth largest in the world. 5 years ago it was at the 11th position.

Employment

No surefire road map. However, hopes are raised looking at seven lakh vacant government posts. Obviously not a daunting figure but something could be done about it. Agreed, no government can ignore indicators showing millions of qualified workforce complaining about lack of opportunities. Nothing can be done in one shot. Job creation is a time taking process and is closely linked to how real economic activity is improved on the ground.

Railway Budget 2019 LIVE: Modernisation of railway stations & Dedicated Freight Corridors to be a big plus

In its manifesto for Lok Sabha Elections 2019, BJP had promised that it would launch a huge programme for modernization of railway stations across the Indian Railways network. IRSDC is already working to make Habibganj and Gandhi Nagar railway stations as world-class transport and transit hubs.

Railway infrastructure would need an investment of Rs 50 lakh crores between 2018 and 2030. Public-Private Partnership (PPP) to be used to unleash faster development and the delivery of passenger freight services.

Two main Dedicated Freight Corridors (DFCs) are expected to decongest mainlines of Indian Railways, hence allowing room for railway infrastructure upgradation and speeding up of the trains.

Manned Level Crossings

Similarly, to kickstart the government's ambitious plan of eliminating manned level crossings, around Rs 1,200 crore may be provided from the Central Road and Infrastructure Fund for this fiscal year. All the unmanned level crossings had already been manned earlier this year.

Both the amounts are likely to be over and above what has already been provided in the interim Budget presented before the General Election.

The original proposal to install CCTV cameras in 983 busiest stations in India with around Rs 500 crore from the Nirbhaya fund has been stuck due to various reasons. This year, the Nirmala Sitharaman-led Finance Ministry is believed to have agreed to release around Rs 250 crore from the Nirbhaya fund to begin work towards the project.

Meanwhile, Railway Minister Piyush Goyal's plan of eliminating all the level crossings in India as part of the Railways agenda for first 100 days seeks to first get rid of all the 2,568 level crossings in the busiest corridors of the Golden Quadrilateral and its diagonals by 2024.

The plan to eliminate the over 19,000 manned level crossings across the country involves a cost of Rs 50,000 crore, which Railways has decided to fund through Central assistance rather than sharing the cost with states. The states will only be asked to acquire the land required for the structures.

The extra money is likely to be added to the Gross Budgetary Support (GBS) to Railways.

The capital expenditure for Railways remains around Rs 1,60,000 crore and a revenue target of around Rs 2,17,000 crore for the current fiscal year as per the Interim Budget. The Centre has also given Railways Rs 64,000 crore as GBS.

Railways is also engaged in implementing new ideas like making a new PSU, the Indian Railway Rolling Stock Corporation to bring all its seven production units under it as an independent entity. There is also the idea of asking passengers to give up the subsidy component of rail tickets, akin to the voluntary giving up of LPG subsidy.

Sitharaman proposes Public-Private Partnership in Railways

This is bound to attract criticism from the Opposition parties but Nirmala Sitharaman has proposed in her first budget a public-private partnership (PPP) in railways.

She said developing railway infrastructure requires investment of Rs 15 lakh crore whereas the capital earning of the railways is only about Rs 1.5-1.6 lakh crore. The finance minister said with such revenue at hand, developing railway infrastructure will take decades. To bridge this gap, Sitharaman proposed public-private investment in railways. There was speculation that the government was exploring ways to involve private players in railways inviting criticism from the Opposition.

To invest widely in agricultural infrastructure

We'll invest widely in agricultural infrastructure. We'll support private entrepreneurship in driving value addition to farmers produce and those from allied activities too, like bamboo, timber and also for generating renewable energy. Why can't food provider also become energy provider (Ann daata ko kyun oorja daata bana nahi sakte)?

Nirmala Sitharaman talks of revolutionising gramin Bharat with 'zero budget farming'

Finance Minister Nirmala Sitharaman said that although zero budget farming is not a new thing, she would like to shift focus on going back to the roots and reassess the implementation of zero budget farming. She said that ten thousand new farmer producer organisations (FPOs) to come up for ensuring economies of scale to farmers.

Jai Kisan, Sorry, it is Fisheries' Welfare

Big farm push assured. But instead of a green revolution it is separate ministry for fisheries. The Budget promises special schemes for ushering in a "blue revolution". The BJP's promise of allocation of Rs.10,000 crore for providing infrastructure like storage and marketing for small fisheries assured.

National Highways Grid

Comprehensive restructuring of National Highways Programme will be done, to ensure the creation of National Highways Grid of desirable capacity. Government envisions using rivers for cargo transport which will also decongest roads and railways.

National Common Mobility will enable people to pay multiple transport charges across India. This card runs on RuPay card and allows users to pay bus charges, parking charges, etc, says FM. National transport card for universal travel which can used on various modes of transport (road, railways etc)

Schemes such as 'Bharatmala', 'Sagarmala' and UDAN are bridging the rural and urban divide, improving the transport infrastructure.

One nation, One grid – Universal Transport Card

'One India-One grid' will give push to connectivity in the country. "National Common Mobility will enable people to pay multiple transport charges across India. This card runs on RuPay card and allows users to pay bus charges, parking charges, etc. National transport card for universal travel which can be used on various modes of transport (road, railways etc). Rail and metro project for 300 km have been approved," Nirmala Sitharaman said.

Waterways to be developed

The movement of cargo on Ganga is estimated to grow four-fold. Multi-modal transport hub has come up in Varanasi in Ganga.

Income Tax Deductions

Additional income tax deduction of Rs 1.5 lakh on interest paid on loans taken to buy electric vehicles. This leads to a benefit of Rs 2.5 lakh crore over the tax period of the loan for the loan payer.

Corporate Tax

Currently, 25% corporate tax rate is applicable to companies with an annual turnover of up to Rs 250 crore. This has been extended to companies with turnover of up to Rs 400 crore. Only 0.7% companies will remain outside of this 25% rate.

Angel's Tax

To resolve the issue of Angel Tax the startups and investors who file requisite declarations will not be subjected to any kind of scrutiny in respect of valuation of share premium. A mechanism of e-verification will be put in place and with this, the funds raised by startups will not require any tax scrutiny.

2% tax levied on cash withdrawal over Rs 1 crore per year

Government has taken number of initiatives to promote digital payments. FM says to discourage the practice of making business payments in cash the government proposes to levy TDS of 2% on cash withdrawal exceeding Rs 1 crore in a year from a bank account.

Impact of Budget on plugging leaks in taxation

According to Sandeep Shah, Partner, N.A. Shah Associates LLP, the Hon'ble Finance Minister has treated both water and tax as scarce resources and consequently focused on plugging loop holes in tax compliance through various measures apart from increasing the tax rate on super rich.

One of the measures is introduction of tax to be deducted at source @ 5.00% from payments made to contractors and professionals in excess of 50.00 lacs even though such payments are not related to business expenses. Similarly the filing of Return of Income even though the income is below the threshold level is made mandatory if the yearly payment towards house electricity is above 1.00 lac or foreign travel expenses for self or others is above 2.00 lacs or deposit in one or more current account is above 100 lacs.

Gift to Non-residents will also be treated as taxable unless the gift is to relative.

Budget 2019 proposes to streamline labour laws

Government to streamline multiple labour laws into a set of four labour codes. This depends on changes in the Industrial Disputes Act and how states implement these laws. Faster resolution of labour disputes should provide comfort to industry and entrepreneurs.

Multiple labour laws to be streamlined into a set of four Labour Codes to standardize registration and filing of returns and reduce disputes.

Telecom

Launched UDAY in 2015 for financial and op turnaround of DISCOMs. Performance is being examined and it will be improved. Union government will work with state governments to remove barriers, cross subsidy, surcharges, undesirable duties on open access sales, or captive generation for industrial and bulk power consumers

Profit Motive

We don't look down upon legitimate profit earning. Gone are the days of policy paralysis and license quota control regime. India Inc are India's job creators, nation's wealth creators. Together with mutual trust we can gain, catalyse past and attain sustained growth.

Micro, Small & Medium Enterprises (MSME)

Government will create a payment platform for MSMEs to enable filing of bills and payment on the platform itself. Government plans to create Manufacturing, Repair and Operate (MRO) industry.

Non-Resident Indians

To provide Non-resident Indians (NRIs) seamless access to Indian equities, NRI portfolio investment route to be merged with foreign portfolio investment route.

Public holding of listed companies up to 35%

Increasing public holding of listed companies from 25 to 35 per cent: This will help ensure more floating stock and liquidity.

Social exchange platform to be set up

This will help social enterprises and voluntary organisations to raise public funds

Simplified KYC norms for FIIs and FPIs

This will remove an impediment to easier flows to India's capital markets

FDI in Aviation, Insurance and Media

The government has proposed more Foreign Direct Investment in Aviation, Insurance and Media in consultation with all stakeholders. 100% FDI will be permitted for insurance intermediaries. Both the Aviation and Insurance sectors which need capital could attract inflows with greater control for overseas partners.

Long term corporate bond market development measures

Allowing AA Rated bonds as collateral should help first raise more funds and ease pressure on banks.

Credit guarantee and investment corporation of India to be set up

This should help banks in terms of additional cushion while looking at lending and support companies and trying to raise funds.

Measures for aircraft financing

Measures for aircraft financing in India should ease the forex burden for Indian aviation companies or airlines who have to pay overseas financiers in a sector which is growing rapidly.

PSUS for housing

Land parcels of PSUS to be developed for housing. This will free land, boost housing with its multiplier effect on other industries and help government raise additional resources.

Incentives for electric vehicles

The government has allocated Rs 10,000 crore for faster adoption of electric vehicles and has announced upfront incentives for electric vehicles. This will help attract investment for manufacture and ensure clean energy over time.

'Study In India' initiative

Propose 'Study In India' initiative to boost higher education, encourage foreign students also to come and study in India.

Government's increasing focus on emerging new technologies

Government's increasing focus on emerging new technologies in the form of artificial intelligence, data science, big data, Internet of Things, would revitalise technology companies.

80 Livelihood business incubators and 20 technology business incubators to be set up in 2019-20 under ASPIRE to develop 75,000 skilled entrepreneurs in agro-rural industries

Over 2 crore Indians made digitally literate

Over 2 crore Indians have been made digitally literate under PMGDISHA. Bharat net to speed up connection in every panchayat in the country.

Budget 2019 on internet connectivity

Under Pradhan Mantri Grameen Digital Saksharata Abhiyan, Bharat Net is targeting internet connectivity in local bodies in every panchayat in the country. This will be speeded under Universal Service Obligation Fund. We will try to improve the skills of our youth in areas such as Artifical Intelligence, Big Data, Robotics, etc.

Water Security & Access to Safe Drinking Water For All

Ensuring India's water security and providing access to safe drinking water to all Indians is a priority. A major step in this direction has been the constitution of Jal Shakti Ministry.

The new Ministry will look at the management of our water resources and water supply in an integrated and holistic manner and will work with states to ensure 'Har Ghar Jal', to all rural households by 2024 under 'Jal Jeevan Mission'.

Indian Universities with Global Recognition

From no single Indian institute in top 200 universities ranking until 5 years ago, we now have 3 institutions in the top 200 global institutions bracket.

Artisans

100 new clusters to be set up in 2019-20 under SFURTI, which will enable 50,000 artisans to join the economic value chain.

Housing for all by 2022

Housing for all by 2022. Under PMAY Garmin, in the 2nd phase 1.95 crore houses are proposed to be provide to eligible beneficiary with facilities like toilet and LPG connection.

'Swachch Bharat Abhiyaan a success'

9.6 crore toilets have been constructed since Oct 2, 2014 under Swachch Bharat Abhiyaan. More than 5.6 lakh villages have become open defecation free. We have to build on this success. The Finance Minister proposes to expand the Swachch Bharat mission to undertake sustainable waste management in every village

New schemes under Khelo India

To popularise sports at all levels, National Sports Education Board for development of sportspersons to be set up under Khelo India.

New TV programme for start ups

A TV programme exclusively for Start ups, matchmaking with venture capitalists, tax planning and more.

Budget 2019 proposes to streamline labour laws

Government to streamline multiple labour laws into a set of four labour codes. This depends on changes in the Industrial Disputes Act and how states implement these laws. Faster resolution of labour disputes should provide comfort to industry and entrepreneurs.

Non-Performing Assets

Non-performing asset (NPAs) recovery of Rs 4 lakh crore over the last four years, NPAs down by Rs 1 lakh crore in the last one year.

Major boost to tourism sector

Government to develop 17 iconic tourism sites. To preserve rich tribal heritage, a digital repository will be created.

Schemes for Women

One woman in every SHG shall be made eligible for a loan of 1 lakh rupees under MUDRA scheme.