KEY HIGHLIGHTS OF UNION BUDGET 2021-22

New Delhi, 1^st February, 2021

Presenting the first ever digital Union Budget, Union Minister of Finance and Corporate Affairs Smt. Nirmala Sitharaman stated that India’s fight against COVID-19 continues into 2021 and that this moment in history, when the political, economic, and strategic relations in the post-COVID world are changing, is the dawn of a new era – one in which India is well-poised to truly be the land of promise and hope.

The key highlights of the Union Budget 2021-22 are as follows:

6 pillars of the Union Budget 2021-22:

1. Health and Wellbeing

2. Physical & Financial Capital, and Infrastructure

3. Inclusive Development for Aspirational India

4. Reinvigorating Human Capital

5. Innovation and R&D

6. Minimum Government and Maximum Governance

• Rs. 2,23,846 crore outlay for Health and Wellbeing in BE 2021-22 as against Rs. 94,452 crore in BE 2020-21 – an increase of 137%
• Focus on strengthening three areas: Preventive, Curative, and Wellbeing
• Steps being taken for improving health and wellbeing:

♦ Vaccines

√ Rs. 35,000 crore for COVID-19 vaccine in BE 2021-22

√  The Made-in-India Pneumococcal Vaccine to be rolled out across the country, from present 5 states – to avert 50,000 child deaths annually

♦ Health Systems

√ Rs. 64,180 crore outlay over 6 years for PM AatmaNirbhar Swasth Bharat Yojana – a new centrally sponsored scheme to be launched, in addition to NHM

√ Main interventions under PM AatmaNirbhar Swasth Bharat Yojana:

National Institution for One Health

• 17,788 rural and 11,024 urban Health and Wellness Centers
• 4 regional National Institutes for Virology
• 15 Health Emergency Operation Centers and 2 mobile hospitals
• Integrated public health labs in all districts and 3382 block public health units in 11 states
• Critical care hospital blocks in 602 districts and 12 central institutions
• Strengthening of the National Centre for Disease Control (NCDC), its 5 regional branches and 20 metropolitan health surveillance units
• Expansion of the Integrated Health Information Portal to all States/UTs to connect all public health labs
• 17 new Public Health Units and strengthening of 33 existing Public Health Units
• Regional Research Platform for WHO South-East Asia Region
• 9 Bio-Safety Level III laboratories

♦ Nutrition

√ Mission Poshan 2.0 to be launched:

♦ Universal Coverage of Water Supply

√ Rs. 2,87,000 crore over 5 years for Jal Jeevan Mission (Urban) – to be launched with an aim to provide:

2.86 crore household tap connections

♦ Swachch Bharat, Swasth Bharat

√ Rs. 1,41,678 crore over 5 years for Urban Swachh Bharat Mission 2.0

√ Main interventions under Swachh Bharat Mission (Urban) 2.0:

Complete faecal sludge management and waste water treatment

♦ Clean Air

√ Rs. 2,217 crore to tackle air pollution, for 42 urban centers with a million-plus population

 

♦ Scrapping Policy

√ Voluntary vehicle scrapping policy to phase out old and unfit vehicles 1′ Fitness tests in automated fitness centres:

♦ Production Linked Incentive scheme (PLI)

√ Rs. 1.97 lakh crore in next 5 years for PLI schemes in 13 Sectors

√ To create and nurture manufacturing global champions for an AatmaNirbhar Bharat

√ To help manufacturing companies become an integral part of global supply chains, possess core competence and cutting-edge technology

√ To bring scale and size in key sectors

√ To provide jobs to the youth

 

♦ Textiles

√ Mega Investment Textiles Parks (MITRA) scheme, in addition to PLI:

√ Textile industry to become globally competitive, attract large investments and boost employment generation & exports

 

♦ Infrastructure

√ National Infrastructure Pipeline (NIP) expanded to 7,400 projects:

√ Measures in three thrust areas to increase funding for NIP:

i. Creation of institutional structures

ii. Big thrust on monetizing assets

iii. Enhancing the share of capital expenditure

 

i. Creation of institutional structures: Infrastructure Financing

a. 5 operational toll roads worth Rs. 5,000 crore being transferred to the NHAIInvIT

b. Transmission assets worth Rs. 7,000 crore to be transferred to the PGCILInvIT

c. Dedicated Freight Corridor assets to be monetized by Railways, for operations and maintenance, after commissioning

d. Next lot of Airports to be monetized for operations and management concession

e. Other core infrastructure assets to be rolled out under the Asset Monetization Programme:
 

iii. Sharp Increase in Capital Budget

Rs. 5.54 lakh crore capital expenditure in BE 2021-22 – sharp increase of 34.5% over Rs. 4.12 lakh crore allocated in BE 2020-21 :
 

• Over Rs. 2 lakh crore to States and Autonomous Bodies for their Capital Expenditure.
• Over Rs. 44,000 crore for the Department of Economic Affairs to provide for projects/programmes/departments exhibiting good progress on Capital Expenditure

√ Rs. 1,18,101 lakh crore, highest ever outlay, for Ministry of Road Transport and Highways – of which Rs. 1,08,230 crore is for capital

√ Under the Rs. 5.35 lakh crore Bharatmala Pariyojana, more than 13,000 km length of roads worth Rs. 3.3 lakh crore awarded for construction:

 

• 3,800 km have already been constructed
• Another 8,500 km to be awarded for construction by March 2022
• Additional 11,000 km of national highway corridors to be completed by March 2022

• Rs. 1.03 lakh crore outlay for 3,500 km of NHs in Tamil Nadu
• Rs. 65,000 crore investment for 1,100 km of NHs in Kerala
• Rs. 25,000 crore for 675 km of NHs in West Bengal
• Over Rs. 34,000 crore to be allocated for 1300 km of NHs to be undertaken in next 3 years in Assam, in addition to Rs. 19,000 crore works of NHs currently in progress in the State

√ Flagship Corridors/Expressways:

√ Advanced Traffic management system in all new 4 and 6-lane highways:

♦ Railway Infrastructure

√ Rs. 1,10,055 crore for Railways of which Rs. 1,07,100 crore is for capital expenditure

√ National Rail Plan for India (2030): to create a ^„future ready‟ Railway system by 2030

√ 100% electrification of Broad-Gauge routes to be completed by December, 2023

√ Broad Gauge Route Kilometers (RKM) electrification to reach 46,000 RKM, i.e. 72% by end of 2021

√ Western Dedicated Freight Corridor (DFC) and Eastern DFC to be commissioned by June 2022, to bring down the logistic costs – enabling Make in India strategy

 

√ Additional initiatives proposed:

• East Coast corridor from Kharagpur to Vijayawada
• East-West Corridor from Bhusaval to Kharagpur to Dankuni
• North-South corridor from Itarsi to Vijayawada

√ Measures for passenger convenience and safety:

♦ Urban Infrastructure

√ Raising the share of public transport in urban areas by expansion of metro rail network and augmentation of city bus service
√ Rs. 18,000 crore for a new scheme, to augment public bus transport:

a. Kochi Metro Railway Phase-II of 11.5 km at a cost of Rs. 1957.05 crore

b. Chennai Metro Railway Phase –II of 118.9 km at a cost of Rs. 63,246 crore

c. Bengaluru Metro Railway Project Phase 2A and 2B of 58.19 km at a cost of Rs. 14,788 crore

d. Nagpur Metro Rail Project Phase-II and Nashik Metro at a cost of Rs. 5,976 crore and Rs. 2,092 crore respectively.

 

♦ Power Infrastructure

√ 139 Giga Watts of installed capacity and Rs. 1.41 lakh circuit km of transmission lines added, and additional 2.8 crore households connected in past 6 years

√ Consumers to have alternatives to choose the Distribution Company for enhancing competitiveness

√ Rs. 3,05,984 crore over 5 years for a revamped, reforms-based and result-linked new power distribution sector scheme

√ A comprehensive National Hydrogen Energy Mission 2021-22 to be launched

 

♦ Ports, Shipping, Waterways

√ Rs. 2,000 crore worth 7 projects to be offered in PPP-mode in FY21-22 for operation of major ports

√ Indian shipping companies to get Rs. 1624 crore worth subsidy support over 5 years in global tenders of Ministries and CPSEs

√ To double the recycling capacity of around 4.5 Million Light Displacement Tonne (LDT) by 2024; to generate an additional 1.5 lakh jobs

 

♦ Petroleum & Natural Gas

√ Extention of Ujjwala Scheme to cover 1 crore more beneficiaries

√ To add 100 more districts to the City Gas Distribution network in next 3 years

√ A new gas pipeline project in J&K

√ An independent Gas Transport System Operator to be set up for facilitation and coordination of booking of common carrier capacity in all-natural gas pipelines on a non-discriminatory open access basis

 

♦ Financial Capital

√ A single Securities Markets Code to be evolved

√ Support for development of a world class Fin-Tech hub at the GIFT-IFSC

√ A new permanent institutional framework to help in development of Bond market by purchasing investment grade debt securities both in stressed and normal times

√ Setting up a system of Regulated Gold Exchanges: SEBI to be notified as a regulator and Warehousing Development and Regulatory Authority to be strengthened

√ To develop an investor charter as a right of all financial investors

√ Capital infusion of Rs. 1,000 crore to Solar Energy Corporation of India and Rs. 1,500 crore to Indian Renewable Energy Development Agency

♦ Increasing FDI in Insurance Sector

√ To increase the permissible FDI limit from 49% to 74% and allow foreign ownership and control with safeguards

 

♦ Stressed Asset Resolution

√ Asset Reconstruction Company Limited and Asset Management Company to be set up

♦ Recapitalization of PSBs

√ Rs. 20,000 crore in 2021-22 to further consolidate the financial capacity of PSBs

♦ Deposit Insurance

√ Amendments to the DICGC Act, 1961, to help depositors get an easy and time-bound access to their deposits to the extent of the deposit insurance cover

√ Minimum loan size eligible for debt recovery under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002 proposed to be reduced from Rs. 50 lakh to Rs. 20 lakh for NBFCs with minimum asset size of Rs. 100 crore

 

♦ Company Matters

√ To decriminalize the Limited Liability Partnership (LLP) Act, 2008

√ Easing Compliance requirement of Small companies by revising their definition under Companies Act, 2013 by increasing their thresholds for Paid up capital from “not exceeding Rs. 50 Lakh” to “not exceeding Rs. 2 Crore” and turnover from “not exceeding Rs. 2 Crore” to “not exceeding Rs. 20 Cr”.

√ Promoting start-ups and innovators by incentivizing the incorporation of One Person Companies (OPCs):

Allowing their growth without any restrictions on paid up capital and turnover

√ Launch of data analytics, artificial intelligence, machine learning driven MCA21 Version 3.0 in 2021-22

 

♦ Disinvestment and Strategic Sale

√ Rs. 1,75,000 crore estimated receipts from disinvestment in BE 2020-21

√ Strategic disinvestment of BPCL, Air India, Shipping Corporation of India, Container Corporation of India, IDBI Bank, BEML, Pawan Hans, Neelachal Ispat Nigam limited etc. to be completed in 2021-22.

√ Other than IDBI Bank, two Public Sector Banks and one General Insurance company to be privatized

√ IPO of LIC in 2021-22

√ New policy for Strategic Disinvestment approved; CPSEs except in four strategic areas to be privatized

√ NITI Aayog to work out on the next list of CPSEs to be taken up for strategic disinvestment

√ Incentivizing States for disinvestment of their Public Sector Companies, using central funds

√ Special Purpose Vehicle in the form of a company to monetize idle land

√ Introducing a revised mechanism for ensuring timely closure of sick or loss making CPSEs

 

♦ Government Financial Reforms

√ Treasury Single Account (TSA) System for Autonomous Bodies to be extended for universal application

√ Separate Administrative Structure to streamline the ^„Ease of Doing Business‟ for Cooperatives

3. Inclusive Development for Aspirational India

 

♦ Agriculture

√ Ensured MSP at minimum 1.5 times the cost of production across all commodities.

√ With steady increase in the procurement, payment to farmers increased as under:

(in Rs. crore)

 

	2013-14	2019-20	2020-21
Wheat	Rs. 33,874	Rs. 62,802	Rs. 75,060
Rice	Rs. 63,928	Rs. 1,41,930	Rs. 172,752
Pulses	Rs. 236	Rs. 8,285	Rs. 10,530

√ SWAMITVA Scheme to be extended to all States/UTs, 1.80 lakh property-owners in 1,241 villages have already been provided cards

√ Agricultural credit target enhanced to Rs. 16.5 lakh crore in FY22 – animal husbandry, dairy, and fisheries to be the focus areas

√ Rural Infrastructure Development Fund to be enhanced to Rs. 40,000 crore from Rs. 30,000 crore

√ To double the Micro Irrigation Fund to Rs. 10,000 crore

√ ‘Operation Green Scheme’ to be extended to 22 perishable products, to boost value addition in agriculture and allied products

√ Around 1.68 crore farmers registered and Rs. 1.14 lakh crore of trade value carried out through e-NAMs; 1,000 more mandis to be integrated with e-NAM to bring transparency and competitiveness.

√ APMCs to get access to the Agriculture Infrastructure Funds for augmenting infrastructure facilities

 

♦ Fisheries

√ Investments to develop modern fishing harbours and fish landing centres – both marine and inland

√ 5 major fishing harbours – Kochi, Chennai, Visakhapatnam, Paradip, and Petuaghat to be developed as hubs of economic activity

√ Multipurpose Seaweed Park in Tamil Nadu to promote seaweed cultivation

 

♦ Migrant Workers and Labourers

√ One Nation One Ration Card scheme for beneficiaries to claim rations anywhere in the country – migrant workers to benefit the most

Scheme implementation so far covered 86% of beneficiaries across 32 States and UTs

√ Portal to collect information on unorganized labour force, migrant workers especially, to help formulate schemes for them

√ Implementation of 4 labour codes underway

Social security benefits for gig and platform workers too

♦ Financial Inclusion

√ Under Stand Up India Scheme for SCs, STs and women,

Margin money requirement reduced to 15%

♦ School Education

√ 15,000 schools to be strengthened by implementing all NEP components. Shall act as exemplar schools in their regions for mentoring others

√ 100 new Sainik Schools to be set up in partnership with NGOs/private schools/states

 

♦ Higher Education

√ Legislation to be introduced to setup Higher Education Commission of India as an umbrella body with 4 separate vehicles for standard-setting, accreditation, regulation, and funding

√ Creation of formal umbrella structure to cover all Govt. colleges, universities, research institutions in a city for greater synergy.

Glue grant to implement the same across 9 cities

√ Central University to come up in Leh for accessibility of higher education in Ladakh

 

♦ Scheduled Castes and Scheduled Tribes Welfare

√ 750 Eklavya model residential schools in tribal areas:

Unit cost of each school to be increased to 38 crore

√ Proposed amendment to Apprenticeship Act to enhance opportunities for youth

√ Rs. 3000 crore for realignment of existing National Apprenticeship Training Scheme (NATS) towards post-education apprenticeship, training of graduates and diploma holders in Engineering

√ Initiatives for partnership with other countries in skilling to be taken forward, similar to partnership:

With UAE to benchmark skill qualifications, assessment, certification, and deployment of certified workforce

• Rs. 50,000 crore outlay over 5 years
• To strengthen overall research ecosystem with focus on national-priority thrust areas

• Rs. 1,500 crore for proposed scheme to promote digital modes of payment
• National Language Translation Mission (NTLM) to make governance-and-policy related knowledge available in major Indian languages
• PSLV-CS51 to be launched by New Space India Limited (NSIL) carrying Brazil‟s Amazonia Satellite and some Indian satellites
• As part of the Gaganyaan mission activities