Indian Budget 2018 – Highlights

Here are the key highlights from Arun Jaitley’s Budget speech:

  • Introduction of GST has made indirect tax system simpler
  • Demonetisation kept a check on liquidity in the economy, promoted digital transactions
  • India is currently a USD 2.5 trillion economy and will become fifth largest economy in the world from the present seventh largest
  • Exports to grow by 17 percent in 2017-18
  • Budget 2018 will focus on strengthening agricultural and rural economy
  • LPG relief for the poor; 4 crore households to get electricity
  • Economy to grow by 7.2-7.5 percent in second half of current fiscal year
  • Emphasis on generating higher income for farmers
  • India produced over 275 million tonnes of foodgrains and 300 million tonnes of fruits and vegetables in 2016-17
  • Crop production at record high; government is committed to giving 50 percent more than cost of crop production to farmers in Budget 2018
  • Direct Benefit Transfer is a global success story
  • Government to set MSP at 1.5 times the cost of production for Kharif crops
  • Government will ensure farmers get MSP if prices fall; Niti Aayog will discuss with state governments for mechanism to ensure farmers get better prices
  • Rs 2,000 crore fund to be set up for upgrading rural agriculture markets
  • Government has promoted organic farmers in a big way; women self-help groups to be encouraged to take up organic farming
  • Agriculture ministry will reorient ongoing programmes to promote cluster-based horticulture production
  • In Budget 2018, Food processing sector growing at 8 percent; allocation for food processing ministry being doubled to Rs 1400 crore
  • India’s agriculture export potential set at $100 bn as against current $ 30 bn exports
  • Government to allocate Rs 500 crore for ‘operation green’ to promote FPOs, agricultural logistics and processing
  • Kisan credit card facility extended to fisheries and animal husbandry sectors
  • Government to restructure national bamboo mission with an outlay of Rs 1,290 crore
  • Surplus power produced by solar-powered generators used by farmers will be bought by state distribution utilities under Budget 2018
  • Institutional credit to agriculture to be raised to Rs 11 lakh crore in 2018-19
  • Govt to set up fisheries and aqua-culture infrastructure fund and animal husbandry infrastructure fund with an outlay of Rs 10,000 crore
  • Special scheme to support efforts of Haryana, Punjab, UP and Delhi to tackle air pollution through use of in-situ machinery for disposing crop residue
  • Rs 16,000 crore to be spent on providing electricity connection to 4 crore poor households
  • Govt to provide free LPG connection to 8 crore households under Ujwala scheme, up from earlier target of 5 crore
  • Over six crore toilets built under Swachh Bharat Mission; government to build another two crore toilets
  • One crore houses to be built under Pradhan Mantri Awas Yojana in rural areas
  • Government to establish a dedicated affordable housing fund under National Housing Bank for priority sector lending in Budget 2018.
  • Government to substantially increase allocation under national livelihood mission to Rs 5,750 crore in next fiscal year
  • Focus of the government will be to provide maximum livelihood projects in rural areas
  • We have managed to get children to school but quality of education still a concern
  • Education to be treated holistically without segmentation from class nursery to 12th under Budget 2018
  • By 2022, every block with more than 50 percent ST population will have Ekalvya schools at par with Navodaya Vidyalayas
  • Government to launch Prime Minister’s Research Fellow Scheme which will identify 1000 B.Tech students to do Ph.D at IITs
  • Two new schools of planning and architecture to be set up; 18 more in IITs and NIITs under Budget 2018 plan
  • Rs 1,200 crore to be allocated for Ayushman Bharat programme in 2018-19
  • Government to launch flagship National Health Protection scheme to cover 10 crore poor and vulnerable people
  • The 10 crore families will be provided Rs 5 lakh cover per family per year for treatment
  • Govt to allocate Rs 600 crore towards nutritional support of tuberculosis patients
  • Government to set up 24 new medical colleges and hospitals by upgrading district level ones under Budget 2018 plan
  • Government is slowly but steadily progressing towards universal health coverage
  • Government identifies 115 ‘aspirational districts’ to make them model districts of development
  • Government’s budget for health, education and social security increased to Rs 1.38 lakh crore for 2018-19 from Rs 1.22 lakh crore in current fiscal year
  • Rs 4.6 lakh cr sanctioned under MUDRA Scheme under Budget 2018
  • Government to soon announce scheme to address the issue of Non- Performing Assets
  • Target for loan disbursement under Mudra scheme set at Rs 3 lakh crore under Budget 2018
  • Mass formalisation of MSME sector is happening after demonetisation and GST
  • Government to take additional measures to strengthen environment for venture capitalists and angel investors
  • Employees PF Act to be amended to reduce contribution of women to 8 percent from 12 percent with no change in employer’s contribution
  • Rs 50 lakh crore needed for infrastructure building
  • Govt to allocate Rs 7,140 crore for textiles sector
  • 99 cities selected for smart cities project with an outlay of Rs 2.04 lakh crore
  • 10 prominent tourist sites to be developed as iconic tourist spots
  • National Highways exceeding 9,000-km will be completed in 2018-19
  • Over Rs 1.48 lakh crore to be allocated for railways in next fiscal
  • 36,000-km of rail track renewal targeted under Budget 2018
  • 4,267 unmanned railway crossings on broad gauge routes to be eliminated in next two years
  • Wifi, CCTVs to be progressively provided at all trains; escalators at stations with 25,000-plus footfall
  • Regional air connectivity scheme shall connect 56 unserved airports and 31 unserved helipads
  • Government to expand capacity of airports by five times to cater to one billion trips a year
  • SEBI may consider mandating large corporates to use bond market to finance one-fourth of their fund needs
  • NITI Aayog to establish a national programme for artificial intelligence
  • Government will monetise select central public sector enterprises using Infrastructure Investment Trusts
  • 5 lakh WiFi hotspots to provide broadband access to 5 crore rural people
  • Government does not consider crypto-currency as legal; will take all measures against its illegal use
  • Government to bring out industry-friendly defence production policy
  • A scheme to provide a unique ID to every enterprise on lines of Aadhaar will be developed
  • Food Corporation of India capital being restructured under Budget 2018 plan
  • Government has initiated strategic disinvestment in 24 PSUs, including Air India
  • More exchange traded funds (ETF) on offer including debt ETF under Budget 2018 plan
  • Rs 80,000 crore disinvestment target for 2018-19; Rs 1 lakh crore receipt expected in current year
  • Government to formulate a comprehensive gold policy to develop gold as an asset class; gold monetisation scheme to be revamped
  • To provide RBI an instrument to deal with excess liquidity, RBI Act and other laws being amended
  • National Insurance Co, Oriental Insurance Co and United Assurance Co to be merged into one entity and subsequently listed
  • President’s emolument raised to Rs 5 lakh, Vice President’s to Rs 4 lakh and Governors’ to Rs 3.5 lakh per month
  • New law to provide automatic revision of emoluments indexed to inflation for MPs under Budget 2018 plan
  • GST revenue for 2017-18 will be for 11 months; shortfall of non-tax revenue due to deferment of spectrum auction
  • Government earmarks Rs 150 cr to commemorate 150 years of birth of Mahatma Gandhi
  • Expenditure for 2017-18 pegged at Rs 21.57 lakh crore, as against Rs 21.8 lakh crore previously estimated
  • Fiscal deficit for 2017-18 raised to 3.5 percent of GDP as against 3.2 percent previously estimated; for FY-19 deficit pegged at 3.3 percent as against 3 percent targeted previously
  • 12.6 percent growth rate in direct taxes in FY-18
  • Rs 90,000 crore additional income tax collection in 2016-17 and 2017-18 due to measures against tax avoidance
  • Huge increase in tax returns filed; 85.51 lakh people filed returns in 2017-18, as against 66.26 lakh in 2016-17
  • Reduced corporate tax by 25 pc extended to companies with turnover of Rs 250 crore to benefit small, micro and medium enterprises
  • Rs 7,000 crore revenue forgone on account of lower corporate tax for Rs 250 crore turnover
  • Standard deduction of Rs 40,000 allowed for transport, medical reimbursement for salaried tax payers
  • Rs 8,000 crore revenue lost due to standard deduction allowed to salaried employees
  • Senior citizens allowed Rs 50,000 deduction on health insurance premium paid in a year from earlier Rs 30,000 under Budget 2018 plan
  • Rs 7.5 lakh per senior citizen limit for investment in interest-bearing LIC schemes doubled to Rs 15 lakh
  • Cash payments exceeding Rs 10,000 by trusts and institutions will be disallowed in a bid to curb cash economy
  • Strong case for long term capital gains from equities; 10 percent tax on long term capital gains in excess of Rs 1 lakh
  • Jaitley announces tax on distributed income of equity oriented mutual funds at the rate of 10 percent
  • Education cess increased to 4 percent from 3 percent to collect additional Rs 11,000 crore under Budget 2018
  • New scheme for providing electronic assessment to eliminate person-to-person contact under Budget 2018 plan
  • Customs duty on mobile phones to be hiked to 20 percent from 15 percent
  • Customs duty on raw cashew cut from 5 percent to 2.5 percent
  • Central Board of Excise and Customs renamed as Central Board of Indirect Taxes and Customs