- Date : 06/02/2021
- Read: 6 mins
Find the major proposals, launches, allocations, and schemes declared by the FM in the 2021 Union Budget.
Symbolising the calm after the pandemic storm, Finance Minister Nirmala Sitharaman opened the Union Budget on 1 February 2021 with a poetic quote from Rabindranath Tagore. Prepared at the backdrop of a crisis that ravaged the economy, the budget understandably aims to revive the economy and bring India back on the growth track.
A slew of schemes and proposals have been proposed in Union Budget 2021. Let’s take a look at the most prominent among them.
- Capital expenditure in the health sector will be increased by 137%. An expenditure of Rs 2.23 lakh crore has been earmarked for the sector.
- Rs 35,000 crore has been allocated for COVID-19 vaccination.
- A PM Atmanirbhar Swasth Bharat Yojana would be launched, for which a sum of Rs 64,180 crore has been allocated over six years.
- Mission Poshan 2.0 will empower nutritional content, along with the merger of the Supplementary Nutrition Programme and Poshan Abhiyan.
- National Nursing and Midwifery Commission Bill to be introduced for the benefit of the nursing profession.
Banking and Financial Services
- Foreign Direct Investment (FDI) in the insurance sector is proposed to be increased from 49% to 74%.
- FY 2022 will also see the initial public offering (IPO) of Life Insurance Corporation.
- One general insurance company and two private sector banks will be privatised.
- Recapitalisation of Rs 20,000 crore is planned to consolidate the financial capacity of public sector banks.
- Asset reconstruction and management companies will be set up to look into the stressed assets in public sector banks.
- A fintech hub will be created at International Financial Services Centre (IFSC).
- A permanent institutional framework will be put in place for the bond market.
- Debt financing of Infrastructure Investment Fund and Real Estate Investment Fund will be allowed to foreign portfolio investors.
- Agriculture credit to be increased from Rs 15 lakh crore to Rs 16.5 lakh crore, aimed at reaching out to the animal husbandry, dairy, and fisheries sectors.
- Allocation to Rural Infrastructure Fund will be increased from Rs 30,000 crore to Rs 40,000 crore, which will bring in additional funds to agriculture and allied activities.
- Allocation to Micro Irrigation Fund to be doubled to Rs 10,000 crore.
- The scope of Operation Green Scheme has been expanded to include 22 new perishable products. It aims to improve the agriculture value chain and exports.
- E-National Agriculture Market will integrate 1000 more mandis in a bid to increase competitiveness and transparency in agricultural trading.
- The infrastructure facilities of Agriculture Produce Market Committees (APMCs) will be improved through the use of Agriculture Infrastructure Fund.
- Setting up of five major fishing harbours, a seaweed park in Tamil Nadu, and a special scheme for tea workers (especially women and children) in Assam and West Bengal.
- To promote universal water supply and household tap connections, Jal Jeevan Mission (Urban) will be funded and implemented over 5 years.
- A Hydrogen Energy Mission will be launched to generate hydrogen from eco-friendly energy sources.
- Coverage of the Ujjwala scheme has been extended to one crore new beneficiaries and 100 more cities will be brought under the city gas coverage network. A new gas pipeline project was also launched for Jammu and Kashmir.
- Gas usage will be encouraged through deregulation of the natural gas sector and market linking of prices.
- A fund of over Rs 2000 crore will be allocated to 32 urban centres to tackle the problem of air pollution.
- Prepaid metering, feeder separation, and other infrastructure enhancements planned for power distribution companies.
- Swachh Bharat Mission 2.0 (Urban) to be provided with Rs 1.42 lakh crore over 5 years.
- Infrastructure creation to be funded with a 34.5% increase in capital expenditure.
- 8500 km of roads will be awarded under Bharatmala project, along with additional 11,000 km under National Highway corridor by March 2022.
- Development Financial Institutions will be set up for funding infrastructure projects.
- National Monetisation Pipeline will be set up to monetise public infrastructure investments, including monetisation measures like dedicated freight corridor and other railway infrastructure assets, airport privatisation, oil and gas pipelines, warehousing assets, etc.
- A future-ready rail system has been targeted for 2030 under the National Rail Plan. Indian Railways’ Western and Eastern Dedicated Freight Corridors to be completed by June 2022.
- Divestments planned in infrastructure companies, including Shipping Corporation of India, Container Corporation of India, Air India etc.
- MetroLite and MetroNeo technologies to be integrated into metro rail systems in Tier-I periphery and Tier-II cities.
- Promotion scheme planned to encourage Indian shipping companies through subsidies in global tenders.
- Petroleum sector to be categorised as a strategic sector with minimised public sector presence and more privatisation and/or mergers.
- The proposed MITRA scheme will see the setting up of 7 mega textile parks in the next 3 years.
- Seven projects worth Rs 2000 crore in major ports will be offered under the PPP model in FY 22.
- Presence of central public sector enterprises in various sectors, including telecom, will be promoted through the government’s disinvestment policy.
- The focus on ‘Make in India’ is set to continue with the impact likely on India’s manufacturing and sourcing strategies.
- Voluntary vehicle scrapping policy has been introduced to replace old vehicles with less polluting and newer automobiles.
- Agriculture Infrastructure and Development Cess has been added to petrol and diesel, with the reduction of other duties to avoid additional burden on the consumer.
- Anti-dumping and countervailing duty on import of metals from specific countries has been temporarily withdrawn.
- Rs 1500 crore to be spent on promotion of digital payments.
- National Digital Educational Architecture will be set up to promote a digital infrastructure and ecosystem.
- A central university has been proposed to be set up in Leh.
- Digital census to be launched for the first time in India.
- MCA21 3.0 will see more use of data analytics, AI, machine learning etc.
- Social security benefits will be extended to cover platform and gig workers.
- A Special Purpose Vehicle will be set up to monetise lands owned by the government and its authorities/agencies.