Presenting the first union budget of the third decade of the century, finance minister Nirmala Sitharaman on Saturday unveiled a series of far-reaching reforms, aimed at energizing the Indian economy through a combination of short-term, medium-term, and long-term measures.

The key highlights of the budget are:

Three prominent themes of the Budget

* Aspirational India: better standards of living with access to health, education and better jobs for all sections of the society
* Economic Development for all: “Sabka Saath , Sabka Vikas , Sabka Vishwas”.
* Caring Society - both humane and compassionate; Antyodaya as an article of faith

Three broad themes are held together by:
* Corruption free, policy-driven Good Governance
* Clean and sound financial sector
* Ease of Living underlined by the three themes of Union Budget 2020-21

Three components of Aspirational India
* Agriculture, irrigation, and rural development
* Wellness, water, and sanitation
* Education and skills

Sixteen action points for agriculture, irrigation and rural development
Rs. 2.83 lakh crore to be allocated for the following 16 Action Points:

* Rs. 1.60 lakh crore for Agriculture, Irrigation & allied activities
* Rs. 1.23 lakh crore for Rural development & Panchayati Raj
* Agriculture credit: Rs. 15 lakh crore target set for the year 2020-21
* PM-KISAN beneficiaries to be covered under the KCC scheme
* NABARD Re-finance scheme to be further expanded

Comprehensive measures for 100 water-stressed districts proposed.

Blue Economy:
* Rs. 1 lakh crore fisheries’ exports to be achieved by 2024-25
* 200 lakh tonnes fish production targeted by 2022-23.
* 3,477 Sagar Mitras and 500 fish farmer producer organisations to involve youth in fisheries extension
* Growing of algae, sea-weed and cage culture to be promoted
* Framework for development, management and conservation of marine fishery resources
* Kisan Rail to be setup by Indian Railways through PPP:
* To build a seamless national cold supply chain for perishables (milk, meat, fish, etc.)
* Express and Freight trains to have refrigerated coaches.
* Krishi Udaan to be launched by the Ministry of Civil Aviation, both international and national routes to be covered.
* North-East and tribal districts to realize Improved value of agri-products
* One-Product One-District for better marketing and export in the Horticulture sector
* Balanced use of all kinds of fertilizers: traditional organic and innovative fertilizers
* Measures for organic, natural, and integrated farming:
--Jaivik Kheti Portal – online national organic products market to be strengthened.
--Zero-Budget Natural Farming (mentioned in July 2019 Budget) to be included.
* Integrated Farming Systems in rain-fed areas to be expanded.
* Multi-tier cropping, bee-keeping, solar pumps, solar energy production in non-cropping season to be added.

PM-KUSUM to be expanded:
        20 lakh farmers to be provided for setting up stand-alone solar pumps.
        Another 15 lakh farmers to be helped to solarise their grid-connected pump sets.
        Scheme to enable farmers to set up solar power generation capacity on their fallow/barren lands and to sell it to the grid.
    Village Storage Scheme:
        To be run by the SHGs to provide farmers a good holding capacity and reduce their logistics cost.
        Women, SHGs to regain their position as Dhaanya Lakshmi.
    NABARD to map and geo-tag agri-warehouses, cold storages, reefer van facilities, etc.
    Warehousing in line with Warehouse Development and Regulatory Authority (WDRA) norms:
        Viability Gap Funding for setting up such efficient warehouses at the block/taluk level.
        Food Corporation of India (FCI) and Central Warehousing Corporation (CWC) to undertake such warehouse building.
    Financing on Negotiable Warehousing Receipts (e-NWR) to be integrated with e-NAM.
    State governments who undertake implementation of model laws (issued by the Central government) to be encouraged.
    Livestock:
        Doubling of milk processing capacity to 108 million MT from 53.5 million MT by 2025.
        Artificial insemination to be increased to 70% from the present 30%.
        MNREGS to be dovetailed to develop fodder farms.
        Foot and Mouth Disease, Brucellosis in cattle and Peste Des Petits ruminants (PPR) in sheep and goat to be eliminated by 2025.
    Deen Dayal Antyodaya Yojana – 0.5 crore households mobilized with 58 lakh SHGs for poverty alleviation.

Wellness, Water and Sanitation

    Rs. 69,000 crore allocated for overall Healthcare sector.
    Rs. 6400 crore (out of Rs. 69,000 crore) for PM Jan Arogya Yojana (PMJAY):
        More than 20,000 hospitals already empanelled under PM Jan Arogya Yojana (PMJAY).
        Viability Gap Funding window proposed for setting up hospitals in the PPP mode.
        Aspirational Districts with no Ayushman empanelled hospitals to be covered in the first phase.
        Targeting diseases with an appropriately designed preventive regime using Machine Learning and AI.
    Jan Aushadhi Kendra Scheme to offer 2000 medicines and 300 surgicals in all districts by 2024.

    TB Harega Desh Jeetega campaign launched - commitment to end Tuberculosis by 2025.

    Rs. 3.60 lakh crore approved for Jal Jeevan Mission:
        Rs. 11,500 crore for the year 2020-21.
        Augmenting local water sources, recharging existing sources, and promoting water harvesting and de-salination.
        Cities with million-plus population to be encouraged to achieve the objective during the current year itself.
    Rs.12, 300 crore allocation for Swachh Bharat Mission in 2020-21:
        Committment to ODF-Plus in order to sustain ODF behaviour.
        Emphasis on liquid and grey water management.

Focus also on Solid-waste collection, source segregation, and processing.

Education and Skills

    Rs. 99,300 crore for education sector and Rs. 3000 crore for skill development in 2020-21.
    New Education Policy to be announced soon.
    National Police University and National Forensic Science University proposed for policing science, forensic science, and cyber-forensics.
    Degree level full-fledged online education program by Top-100 institutions in the National Institutional Ranking Framework.
    Up to 1-year internship to fresh engineers to be provided by Urban Local Bodies.
    Budget proposes to attach a medical college to an existing district hospital in PPP mode.
    Special bridge courses to be designed by the Ministries of Health, and Skill Development:
        To fulfill the demand for teachers, nurses, para-medical staff and care-givers abroad.
        To bring in equivalence in the skill sets of the workforce and employers’ standards.
    150 higher educational institutions to start apprenticeship embedded degree/diploma courses by March 2021.
    External Commercial Borrowings and FDI to be enabled for education sector.
    Ind-SAT proposed for Asian and African countries as a part of Study in India program.

Economic Development

Industry, Commerce and Investment

    Rs. 27,300 crore allocated for 2020-21 for development and promotion of Industry and Commerce.
    Investment Clearance Cell proposed to be set up:

o To provide “end to end” facilitation and support.

o To work through a portal.

    Five new smart cities proposed to be developed.
    Scheme to encourage manufacture of mobile phones, electronic equipment and semi-conductor packaging proposed.
    National Technical Textiles Mission to be set up:

o With four-year implementation period from 2020-21 to 2023-24.

o At an estimated outlay of Rs 1480 crore.

o To position India as a global leader in Technical Textiles.

    New scheme NIRVIK to be launched to achieve higher export credit disbursement, which provides for:

o Higher insurance coverage

o Reduction in premium for small exporters

o Simplified procedure for claim settlements.

    Turnover of Government e-Marketplace (GeM) proposed to be taken to Rs 3 lakh crore.
    Scheme for Revision of duties and taxes on exported products to be launched.

o Exporters to be digitally refunded duties and taxes levied at the Central, State and local levels, which are otherwise not exempted or refunded.

    All Ministries to issue quality standard orders as per PM’s vision of “Zero Defect-Zero Effect” manufacturing.

Infrastructure

    Rs.100 lakh crore to be invested on infrastructure over the next 5 years.
    National Infrastructure Pipeline:

o Rs. 103 lakh crore worth projects; launched on 31st December 2019.

o More than 6500 projects across sectors, to be classified as per their size and stage of development.

    A National Logistics Policy to be released soon:

o To clarify roles of the Union Government, State Governments and key regulators.

o A single window e-logistics market to be created

o Focus to be on generation of employment, skills and making MSMEs competitive.

    National Skill Development Agency to give special thrust to infrastructure-focused skill development opportunities.
    Project preparation facility for infrastructure projects proposed.

o To actively involve young engineers, management graduates and economists from Universities.

    Infrastructure agencies of the government to involve youth-power in start-ups.
    Rs.1.7 lakh crore proposed for transport infrastructure in 2020-21.

Highways:

    Accelerated development of highways to be undertaken, including:

o 2500 Km access control highways.

o 9000 Km of economic corridors.

o 2000 Km of coastal and land port roads.

o 2000 Km of strategic highways.

    Delhi-Mumbai Expressway and two other packages to be completed by 2023.
    Chennai-Bengaluru Expressway to be started.
    Proposed to monetise at least 12 lots of highway bundles of over 6000 Km before 2024.

Indian Railways:

    Five measures:

o Large solar power capacity to be set up alongside rail tracks, on land owned by railways.

o Four station re-development projects and operation of 150 passenger trains through PPP.

o More Tejas type trains to connect iconic tourist destinations.

o High speed train between Mumbai and Ahmedabad to be actively pursued.

o 148 km long Bengaluru Suburban transport project at a cost of Rs 18600 crore, to have fares on metro model. Central Government to provide 20% of equity and facilitate external assistance up to 60% of the project cost.

Ports & Water-ways:

    Corporatizing at least one major port and its listing on stock exchanges to be considered.
    Governance framework keeping with global benchmarks needed for more efficient sea-ports.
    Economic activity along river banks to be energised as per Prime Minister’s Arth Ganga concept.

Airports:

    100 more airports to be developed by 2024 to support Udaan scheme.
    Air fleet number expected to go up from present 600 to 1200 during this time.

Electricity:

    “Smart” metering to be promoted.
    More measures to reform DISCOMs to be taken.

Power:

    Rs.22, 000 crore proposed for power and renewable energy sector in 2020-21.
    Expansion of national gas grid from the present 16200 km to 27000 km proposed.
    Further reforms to facilitate transparent price discovery and ease of transactions.

New Economy

    To take advantage of new technologies:

o Policy to enable private sector to build Data Centre parks throughout the country to be brought out soon. 

o Fibre to the Home (FTTH) connections through Bharatnet to link 100,000 gram panchayats this year.

o Rs.6000 crore proposed for Bharatnet programme in 2020-21.

    Measures proposed to benefit Start-ups:

o A digital platform to be promoted to facilitate seamless application and capture of IPRs.

o Knowledge Translation Clusters to be set up across different technology sectors including new and emerging areas.

o For designing, fabrication and validation of proof of concept, and further scaling up Technology Clusters, harbouring test beds and small scale manufacturing facilities to be established.

o Mapping of India’s genetic landscape- Two new national level Science Schemes to be initiated to create a comprehensive database.

o Early life funding proposed, including a seed fund to support ideation and development of early stage Start-ups.

    Rs.8000 crore proposed over five years for National Mission on Quantum Technologies and Applications.

Caring Society

    Focus on:

o Women & child,

o Social Welfare;

o Culture and Tourism

    Allocation of Rs. 35,600 crore for nutrition-related programmes proposed for the FY2020-21.
    Rs.28, 600 crore proposed for women specific programs.
    Issue about age of a girl entering motherhood - proposed to appoint a task force to present its recommendations in six months’ time.
    Financial support for wider acceptance of technologies, identified by Ministry of Housing and Urban Affairs to ensure no manual cleaning of sewer systems or septic tanks, to be provided.
    Rs. 85, 000 crore proposed for 2020-21 for welfare of Scheduled Castes and Other Backward Classes.
    Rs. 53, 700 crore provided to further development and welfare of Scheduled Tribes.
    Enhanced allocation of Rs. 9,500 crore provided for 2020-21 for senior citizens and Divyang.

Culture & Tourism

    Allocation of Rs. 2500 crore for 2020-21 for tourism promotion.
    Rs.3150 crore proposed for Ministry of Culture for 2020-21.
    An Indian Institute of Heritage and Conservation under Ministry of Culture proposed; with the status of a deemed University.
    5 archaeological sites to be developed as iconic sites with on-site Museums:

o Rakhigarhi (Haryana)

o Hastinapur (Uttar Pradesh)

o Shivsagar (Assam)

o Dholavira (Gujarat)

o Adichanallur (Tamil Nadu)

    Re-curation of the Indian Museum in Kolkata, announced by Prime Minister in January 2020.
    Museum on Numismatics  and Trade to be located in the historic Old Mint building in Kolkata.
    4 more museums from across the country to be taken up for renovation and re-curation.
    Support for setting up of a Tribal Museum in Ranchi (Jharkhand).
    Maritime museum to be set up at Lothal- the Harrapan age maritime site near Ahmedabad, by Ministry of Shipping.
    State governments expected to develop a roadmap for certain identified destinations and formulate financial plans during 2021 against which specified grants to be made available to the States in 2020-21.

Environment & Climate Change

    Allocation for this purpose to be Rs.4400 crore for 2020-21.
    Proposed to advise the utilities to close the running old thermal power plants with carbon emission above the pre-set norms.
    States that are formulating and implementing plans for ensuring cleaner air in cities above one million to be encouraged.
    PM launched Coalition for Disaster Resilient Infrastructure (CDRI) with Secretariat in Delhi. Second such international initiative after International Solar Alliance.

Governance

    Clean, corruption-free, policy driven, good in intent and most importantly trusting in faith.
    Taxpayer Charter to be enshrined in the Statute will bring fairness and efficiency in tax administration.
    Companies Act to be amended to build into statues, criminal liability for certain acts that are civil in nature.
        Other laws with such provisions are to be corrected after examination.
    Major reforms in recruitment to Non-Gazetted posts in Government and Public sector banks:
        An independent, professional and specialist National Recruitment Agency (NRA) for conducting a computer-based online Common Eligibility Test for recruitment.
        A test-centre in every district, particularly in the Aspirational Districts.
    A robust mechanism to be evolved for appointment including direct recruitment to various Tribunals and specialised bodies to attract best talents and professional experts.
    Contract Act to be strengthened.
    New National Policy on Official Statistics to:
        Promote use of latest technologies including AI.
        Lay down a road-map towards modernised data collection, integrated information portal and timely dissemination of information.
    A sum of Rs. 100 crore allocated to begin the preparations for G20 presidency to be hosted in India in the year 2022.
    Development of North East region:
        Improved flow of funds using online portal by the Government.
        Greater access to financial assistance of Multilateral and Bilateral funding agencies.
    Development of Union Territories of J&K and Ladakh:
        An amount of Rs. 30,757 crore provided for the financial year 2020-21.
    The Union Territory of Ladakh has been provided with Rs. 5,958.

Financial Sector

    Reforms accomplished in PSBs :
        10 banks consolidated into 4.
        Rs. 3,50,000 crore capital infused.
    Governance reforms to be carried out to bring in transparency and greater professionalism in PSBs.
    Few PSBs to be encouraged to approach the capital market to raise additional capital
    Deposit Insurance and Credit Guarantee Corporation (DICGC) permitted to increase Deposit Insurance Coverage to Rs. 5 lakh from Rs.1 lakh per depositor.
    Scheduled Commercial Bank’s health under monitoring through a robust mechanism, keeping depositors’ money safe.
    Cooperative Banks to be strengthen by amending Banking Regulation Act for:
        Increasing professionalism.
        Enabling access to capital.
        Improving governance and oversight for sound banking through the RBI.
    NBFCs eligibility limit for debt recovery reduced from:
        Rs. 500 crore to Rs 100 crore asset size.
        Rs 1 crore to Rs 50 lakh loan size.
    Private capital in Banking system:
        Government to sell its balance holding in IDBI Bank to private, retail and institutional investors through the stock exchange.
    Easier mobility in jobs:
        Auto-enrolment in Universal Pension coverage.
        Inter-operability mechanism to safeguard the accumulated corpus.
    Pension Fund Regulatory Development Authority of India Act to be amended to:
        Strengthen regulating role of PFRDAI.
        Facilitate separation of NPS trust for government employees from PFRDAI.
        Enable establishment of a Pension Trust by the employees other than Government.
    Factor Regulation Act 2011 to be amended to:
        Enable NBFCs to extend invoice financing to the MSMEs through TReDS
    New scheme to provide subordinate debt for entrepreneurs of MSMEs by the banks
        Would be counted as quasi-equity.
        Would be fully guaranteed through the Credit Guarantee Trust for Medium and Small Entrepreneurs (CGTMSE).
        The corpus of the CGTMSE would accordingly be augmented by the government.
    Window for MSME’s debt restructuring by RBI to be extended by one year till March 31, 2021.
        More than five lakh MSMEs have already been benefitted.
    An app-based invoice financing loans product for MSMEs to be launched.
        To prevent the problem of delayed payments and consequential cash flows mismatches.
    Export promotion of MSMEs:
        For selected sector such as pharmaceuticals, auto components and others.
        An Rs 1000 crore scheme anchored by EXIM Bank together with SIDBI.
      Hand holding support for technology upgradations, R&D, business strategy etc.

Financial Market

    Deepening Bond Market.
        Certain specified categories of Government securities to be opened fully for non -resident investors also.
        FPI limit in corporate bonds increased to 15% from 9% of its outstanding stock.
    New legislation to be formulated for laying down a mechanism for netting of financial contracts. 
        Scope of credit default swaps to expand.
    Debt Based Exchange Traded Fund expanded by a new Debt-ETF consisting primarily of Government Securities.
        To give attractive access to retail investors, pension funds and long-term investors.
    A Partial Credit Guarantee scheme for the NBFCs formulated post the Union budget 2019-20 to address their liquidity constraints.
        New mechanism to be devised to further this.
   Government support to securities so floated.

Infrastructure Financing

    Rs.103 lakh crore National Infrastructure Pipeline projects earlier announced.
    Rs 22,000 crore to cater to the equity support to Infrastructure Finance Companies such as IIFCL and a subsidiary of NIIF.
    IFSC, GIFT city: full of potential to become a centre of international finance as well as a centre for high end data processing:

o An International Bullion exchange(s) to be set up as an additional option for trade by global market participants with the approval of regulator.

Disinvestment

    Government to sell a part of its holding in LIC by way of Initial Public Offer (IPO).

Fiscal Management

    XV Finance Commission (FC):

o XV Finance Commission has given its first report for FY2020-21

o Recommendations accepted in substantial measure

o Its final report for five years beginning 2021-22 to be submitted during the latter part of the year.

    GST Compensation Fund:

o Balances due out of collection of the years 2016-17 and 2017-18 to be transferred to the Fund, in two instalments.

o Hereinafter, transfers to the fund to be limited only to collection by way of GST compensation cess.

    Overhaul of Centrally Sponsored Schemes and Central Sector Schemes necessary:

o To align them with emerging social and economic needs of tomorrow

o To ensure that scarce public resources are spent optimally

    On the recent debate over transparency and credibility of projected fiscal numbers, it is assured that procedure adopted is compliant with the FRBM Act.
    For the FY 2019-20:

o Revised Estimates of Expenditure: at Rs.26.99 lakh crore

o Revised Estimates of Receipts: estimated at Rs.19.32 lakh crore.

    For year 2020-21:

o Nominal growth of GDP estimated at 10%.

o Receipts: estimated at Rs.22.46 lakh cr

o Expenditure: at Rs.30.42 lakh cr.

    Significant tax reforms for boosting investments recently undertaken. However, expected tax buoyancy expected to take time.
    Fiscal deficit of 3.8% estimated in RE 2019-20 and 3.5% for BE 2020-21.  It comprises two ingredients;

o 3.3% for year 2019-20 and 3% for the 2020-21 budget estimate.

o Deviation of 0.5%, consistent with Section 4(3) of FRBM Act, both for RE 2019-20 and BE 2020-21. (Section 4 (2) of the FRBM Act provides for a trigger mechanism for a deviation from the estimated fiscal deficit on account of structural reforms in the economy with unanticipated fiscal implications.)

o Return path, committing to fiscal consolidation without compromising needs of investment out of public funds, is laid in Medium Term Fiscal Policy cum Strategy Statement.

o Market borrowings: Net market borrowings: Rs.4.99 lakh crore for 2019-20 and Rs.5.36 lakh crore for 2020-21.

    A good part of the borrowings for the financial year 2020-21 to go towards Capital expenditure that has been scaled up by  more than 21%.

Unprecedented Milestones and Achievements of Indian Economy

    India now the fifth largest economy of the world.
    7.4% average growth clocked during 2014-19 with inflation averaging around 4.5%.
    271 million people raised out of poverty during 2006-16.
    India’s Foreign Direct Investment elevated to US$ 284 billion during 2014-19 from US$ 190 billion during 2009-14.
    Central Government debt reduced to 48.7% of GDP (March 2019) from 52.2% (March 2014).
    Two cross-cutting developments:
        Proliferation of technologies (Analytics, Machine Learning, robotics, Bio-informatics and Artificial Intelligence).
        Highest ever number of people in the productive age group (15-65 years) in India.
    GST removed many bottlenecks in the system.

Future Aim for sustaining India’s unique global leadership, driven by Digital Revolution

    Seamless delivery of services through Digital Governance.
    Improvement in physical quality of life through National Infrastructure Pipeline.
    Risk mitigation through Disaster Resilience.
    Social security through Pension and Insurance penetration.