Indian General Budget 2018
Budget Presentation – An Event in India
Budget Presentation in India is not a Yearly Activity, but an ‘Event’. Preparation for the same involves participation from many experts of various fields, Ministries, Niti Ayog members (earlier known as Planning Commission). A very high voltage promotion for this event is also done on various business TV channels. Various experts, financial Inc.’s takes part in the budget-related discussion and debate on these TV shows for almost a week prior to the budget, creating an enthusiasm among common public and various business owners, may it be MSME owners or Big Players.
The budget was used to be presented on the 28th day of February before the Year 2017, which use to start with Railway Budget (Railway Minister Use to present it), followed by the General Budget and presented by Honorable Finance Minister. But from the Year 2017, Railway Budget was merged in General Budget & date for the presentation was preponed to the 1st day of February.
The Budget Day (1st day of February)
On the day of the event, Honorable Indian Finance Minister leaves his Official Residence sharp at 8:45 am for his office in the Ministry of Finance, where he collects the Budget documents. At around 9:15 am he reaches Rashtrapati Bhavan to formally present the budget document to the Honorable President of India for his approval. After getting approval from The Honorable President i.e. at around 10:15 am Finance Minister reaches Parliament along with all his colleagues for a cabinet meeting. The Budget Presentation by Honorable Finance Minister Starts sharp at 11:00 am. Live media coverage of the same is done by government-owned TV channels.
Indian General Budget 2018
In this blog, I will try to cover the key highlights of the presented Budget. Majority of the experts on various discussion panels on TV gave a confident Thumbs Up for this Budget. They called this Budget as “Landmark Budget”, “Pro-Poor Pro-Farmer Budget”, “New India Budget”, “Bharat Budget”, “Jai Kisan Budget”, “Pro Agricultural Budget”, “Political Budget”, “Popular Budget” , “Reformatory Budget”, “Populist Budget”, “The Best Budget up till now” Etc. Stock Markets also welcomed the budget in Green with some up-down activity in the afternoon & ending on almost Flat Note.
The Key Highlights of the Budget
Agriculture & Rural Sector
- Farmers assured MSP 1.5 times the production/produce cost.
- Cluster Development for Agricultural Sector.
- Direct sales from Farmers will be promoted.
- 2200 Crore allotted to Agricultural Market Infrastructure.
- Allotment of Rs. 1600 Cr. To electrification of rural villages. 4 Cr. Homes to get electricity.
- 2 Cr. Toilets construction targeted in this year.
- Housing for poor – 51 Lakhs housing planned for this year 17-18 plus another 51 Lakhs homes planned for Year 18-19.
- Solar operated water pumps will be made available at low rates to farmers.
- Organic Farming will be promoted.
- Allotment of Rs. 500 Cr. For ‘Operation Green’ (Onion & Potato Production)
- Kisan Credit Card Facility will be given to Fishery & Animal Husbandry sector.
- Agricultural Produce Export will be made easier.
- E-mandi to connect farmers.
- Rs 10,000 Cr. allotted for fisheries & aquaculture, animal husbandry funds.
- Rs 1,290 Cr. allotted to the national bamboo mission.
MEME & Corporate Sector
- Allotment of Rs. 1400 Cr. to perfume and Small-scale Industry.
- Allotment of Rs. 1400 Cr. to food processing sector.
- 100% tax exemption for agricultural companies whose Turnover is greater than 100 Cr.
- 3794 Crore allotted to MSME sector, online loan application facility will be set.
- 3 Lakh Crore allotted to Mudra Yojna.
- Customs Duties on various product increased, which will indirectly help to boost ‘Make in India’ initiative and wake the sense of competitiveness among Indian Manufacturers.
- 7148 Crore allotted to the Textile sector.
- Corporate Tax Relief for MSME.
- Corporate Tax of 25% up to 250 Cr. Turnover.
- Poorest of Poor will be covered by Healthcare Insurance Cover of Rs. 5 Lakhs / Family / Year. (10 Crore Families will be benefited)
- 1200 Cr. allotted to health & wellness sector.
- Rs 600 Cr. allotted for nutritional support to all tuberculosis patients.
Education, Employment & Senior Citizen welfare Sector
- The target of 70 Lakhs new employment set.
- Standard Deduction of Rs. 40,000/- against Travel & Medical Expenses to Salaried Employee. Standard Deduction was stopped in the year 2005 by the then Government.
- Rs 32,600 Cr. allotted to National Education Mission FY19.
- 50 L Youth will be trained for skill development.
- Personal Income Tax Slabs remains unchanged.
- No tax up to Rs 50000 medical expenses.
- No tax up to Rs 50000 medical expenses for Sr. Citizen + no tax up to Rs. 1 L for Critical illness expense for Sr. Citizen.
- Fiscal Deficit was kept at 3.3 for the Year 2018-19, Last year it was 3.5.
- Disinvestment Target of Rs. 80,000 Cr.
- Government Estimates GDP Growth of 7.2 – 7.5 % in second half of FY18.
- Long-Term Capital Gain tax reintroduced at 10% tax on the capital gain of Rs. 1 lakh in shares. STT to remain, which was introduced in place of LTCG by the previous Govt. (Market collapsed after this announcement at around 1:00 pm)
- 10% tax on Mutual Fund Dividend.
- Education cess replaced by Health & Education cess & increased from 3% to 4%.
- 05 L Cr. allotted to SC/ST Fund.
Real Estate, Roads, Railways, Seaways & Infrastructure Sector
- Rs 27,500 Cr. allotted to PM Affordable Housing Plan FY19.
- Rs 19,000 Cr. allotted to PM Rural Road Plan FY19.
- Rs 17,800 Cr. allotted to Swachh Bharat Mission in FY19.
- Rs 5,750 Cr. allotted to national livelihood mission.
- 1.48 Lakh Crore allotted to Railway sector.
- 10 New Tourists locations to be developed.
- Seaplane Yojna Declared.
- 1 Medical College in every 3 parliamentary regions.
- 35000 Km of Road Planned.
- 600 Railway stations to be modernized.
- 11000 Cr. Allotted to Mumbai Railways.
- 17000 Cr. Allotted to Bangaluru Metro.
- 100 Adarsh Smaraks (Memorials) will be erected.
- For Airport Authorities, Fund generation mechanism will be set.
- The tunnel at ‘Seva Pass’ approved.
- 1 L Panchayats will be connected with internet.
- Elevator facilities at railway stations having more than 25000 tourists/day.
- 5 L Hotspots for villages.
- Airport capacity to increase by 5 times.
Considering the fact that this was last full budget for this govt. tenure prior to going for General Elections in the Year 2019, I observe that the budget is balanced and matured budget. We always listen that India is an Agricultural Country, so this sector is been taken care of in this Budget. Healthcare for Poor is again an important & landmark announcement. Salaried should not be disappointed as their interest was taken care in previous budgets, where tax slab was increased from 2 L to 2.5 L. This was purely Pro-poor, Pro Agriculture Reformatory Budget. If the provisions in the budget are implemented to fullest or to maximum, I think this will be a major step in moving forward towards ‘NEW INDIA’.
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© Vikram Ashok Pore 2018