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 ‘New India’ by 2022; 75 years of India’s independence: universal access to housing, toilets, water, electricity; farmers’

income doubled; ample opportunities for youth; zero terrorism, communalism, casteism, corruption, nepotism.
 India fastest growing major economy in the world; from 11th largest in 2013-14, today 6th largest economy in world
 Inflation - hidden and unfair tax on the poor and middle class; average inflation during 2009-14 = 10.1%; today = 4.6%
 Fiscal deficit brought down to 3.4% in 2018-19 RE; Current account deficit (CAD) to be only 2.5% of GDP this year
 14th Finance Commission had recommended increasing the share of the States from 32% to 42% in central taxes
 FDI during the last 5 years = $239 billion; most FDI to come through the automatic route.
 Primary reason for spurt in non-performing loans and stressed assets is aggressive credit growth in period 2008-14
(outstanding loans of PSBs rose from 18 lakh crore to 52 lakh crore in this period); many projects were started that could
either not be completed or had low capacity utilisation resulting in their inability to pay back their loans
 Culture of “phone banking” = sanctioning loans over phone calls; result of crony capitalism; NOT ‘telephone banking’
 The 4Rs approach towards NPAs = recognition, resolution, re-capitalisation and reforms
 Steps to improve health of PSBs = 3 lakh crore recovered in favour of banks + Recapitalisation of PSBs by 2.6 lakh crore +
Amalgamation of banks to reap benefits of economies of scale, improved access to capital and a larger geographical spread
 RERA Act and Benami Transaction (Prohibition) Act to bring transparency in the real estate sector
 Fugitive Economic Offenders Act, 2018 to confiscate and dispose off assets of economic offenders who escape India
 World’s largest behavioural change movement = Swachh Bharat Mission; 98% rural sanitation; 5.45 lakh villages ODF
 10% reservation in educational institutions and govt services for EWS; 25% extra seats (2 lakh) to avoid shortfall
 To provide food grains at affordable prices, 1.7 lakh crores spent in 2018-19
 60,000 crores allocated for MGNREGA in BE 2019-20
 Pradhan Mantri Gram Sadak Yojana - 15.80 lakh out of 17.84 lakh habitations connected with pucca roads
 Pradhan Mantri Awas Yojana - 1.53 crore houses built by NDA
 Ayushman Bharat - world’s largest healthcare programme, to provide medical treatment to 50 crore people.
 Pradhan Mantri Jan Aushadhi Kendras - medicines at affordable prices
 Aspirational Districts Programme - targeted development to the 115 most backward districts of the country.
 First time ever MSP fixed of all 22 crops at minimum 50% more than the cost
 Reasons for reduced returns from farming - declining prices of agricultural commodities in the international market; fall in
food inflation in India since 2017-18; Small and fragmented land holding
 Pradhan Mantri KIsan Samman Nidhi (PM-KISAN) - To provide assured income support to small and marginal farmers;
vulnerable landholding farmers (around 12 crore), having cultivable land upto 2 hectares, will be provided direct income
support at the rate of Rs.6,000 per year, in DBT form, in three equal instalments of Rs.2,000 each; funded by Central Govt;
annual expenditure of Rs. 75,000 crore
 Soil Health Cards, Neem Coated Urea to remove shortage of fertilizers
 Rashtriya Gokul Mission - setting up of Rashtriya Kamdhenu Aayog for genetic up-gradation of cows and enhance their
productivity; The Aayog will also look after effective implementation of laws and welfare schemes for cows
 India second largest fish producing nation in the world => separate Department of Fisheries.
 2% interest subvention to the farmers pursuing animal husbandry and fisheries, who avail loan through Kisan Credit Card +
on timely repayment of loan, additional 3% interest subvention
 Farmers affected by severe natural calamities, where assistance is provided from National Disaster Relief Fund (NDRF), to get
interest subvention of 2% + prompt repayment incentive of 3% for the entire period of reschedulement of loans
 New Pension Scheme (NPS) - contribution of employee still 10% + govt contribution increased to 4% making it 14%.
 Under Payment of Bonus Act, 1965 – max ceiling of bonus to labour raised from Rs. 3.5k to 7k per month and wage limit of
eligibility for bonus raised from Rs. 10k to 21k per month => more labour can claim bonus + higher amount of bonus
 Under Payment of Gratuity Act, 1972 – ceiling of gratuity payment raised from Rs. 10 lakh to 20 lakh
 Ceiling of ESI's (Employee State Insurance Scheme) eligibility cover has been increased from Rs.15,000 pm to 21,000; min
pension for every labourer fixed at Rs. 1000/month; if labour dies during service, amount by EPFO raised from 2.5 to 6 lakh
 Anganwadi and Asha Yojana honorarium enhanced by about 50% for all categories of workers
 Pradhan Mantri Jeevan Jyoti Bima Yojana and Pradhan Mantri Suraksha Bima Yojana
 Pradhan Mantri Shram-Yogi Maandhan - Mega pension yojana for unorganised sector workers with monthly income upto
Rs.15,000; provide them an assured monthly pension of Rs.3,000 from age of 60 years; worker joining pension yojana at the
age of 29 years will have to contribute only Rs. 100 per month till the age of 60 years; worker joining the pension yojana at
18 years, will have to contribute Rs. 55 per month. Govt will deposit equal matching share in the pension account of the
worker every month. Rs.500 crore allocated for the Scheme.
 Renke Commission and Idate Commission on Nomadic and Semi-Nomadic communities; Welfare Development Board under
Ministry of Social Justice and Empowerment set up for De-notified, Nomadic and Semi-Nomadic communities
 Ujjwala Yojana - to deliver 8 crore free LPG connections; >6 crore connections already given
 Pradhan Mantri MUDRA Yojana : > 70% of beneficiaries are women
 Benefits of Maternity leave of 26 weeks for working women
 Pradhan Mantri Matru Vandana Yojana for pregnant women - financial support to empower them to work
 Pradhan Mantri Kaushal Vikas Yojana - over 1 crore youth being trained to help them earn a livelihood; self-employment
schemes including MUDRA, Start-up India and Stand-up India
 India has become the world’s second largest start-up hub
 National Programme on 'Artificial Intelligence'(AI) envisaged + National Centre on AI + National AI portal envisaged
 Scheme of sanctioning loans upto Rs.1 crore in 59 minutes launched; website
 GST-registered SME units will get 2% interest rebate on incremental loan of Rs.1 Crore
 Requirement of sourcing from SMEs by Govt enterprises has been increased to 25% (>3% from women owned SMEs)
 Government e-Marketplace (GeM) to make public procurement fully transparent, inclusive and efficient
 Dept of Industrial Policy and Promotion(DIPP) renamed Dept for Promotion of Industries and Internal Trade (including retail
trading and welfare of traders, and their employees)
 Disbursed over Rs.35,000 crore after implementing OROP (in the last 5 years)
 Defence Budget will be crossing Rs 3,00,000 crore for the first time in 2019-20
 Pakyong airport in Sikkim commissioned (100+ operational airports in India now)
 India fastest highway developer in the world with 27 kms of highways built each day; important projects - Eastern Peripheral
Highway around Delhi, Bogibeel rail-cum-road bridge in Assam and Arunachal Pradesh
 Sagarmala programme along coastal areas to develop ports for faster handling of import and export cargo
 Container freight movement has started on inland waterways from Kolkata to Varanasi
 Vande Bharat express - first indigenously developed and manufactured semi high-speed train
 Railways’ overall capital expenditure = Rs.1,58,658 crore; Operating Ratio is expected to improve from 98.4% in 2017-18 to
96.2% in 2018-19 (RE) and further to 95% in 2019-20 (BE)
 International Solar Alliance - first treaty based international inter-governmental organisation headquartered in India
 Govt to make 1 lakh villages into Digital Villages over next five years
 Gaganyaan space programme = India as a launch-pad of satellites for the World + placing Indian in space by 2022
 Probable essay topic = Minimum Government Maximum Governance nation
 Estimated fiscal deficit for 2019-20 = 3.4% of GDP; target of 3.3% for 2018-19 will also be breached due to PM-KISAN;
without PM-KISAN, fiscal deficit would have been < 3.3% for 2018-19 and < 3.1% for year 2019-20
 Total expenditure = Rs. 27,84,200 crore in 2019-20 (Capital Expenditure = Rs. 3,36,292 crore; Centrally Sponsored Schemes =
Rs. 3,27,679 crore; National Education Mission = Rs. 38,572 crore; ICDS = 27,584 crore)
 Expenditure for SCs = Rs. 76,801 crore; for STs = Rs. 50,086 crore => significant increase in for both
 Disinvestment proceeds during 2017-18 = 1 lakh crore; target Rs. 80,000 crore for 2018-19 (2019-20 target unknown)
 Target of 3% of fiscal deficit to be achieved by 2020-21
 India’s Debt to GDP ratio was 46.5% in year 2017-18; FRBM Act prescribes that Debt to GDP ratio of Centre should be
brought down to 40% by 2024-25, hence focus now on Debt Consolidation along with Fiscal Consolidation
 Stamp duties (on financial transactions; currently State subject; not under GST) to be levied on one instrument relating to
one transaction and get collected at one place through Stock Exchanges. The duty so collected will be shared with State
govts seamlessly on the basis of domicile of buying client
 Tax reforms by NDA in previous Budgets
o Tax collections increased from Rs.6.38 lakh crore in 2013-14 to Rs. 12 lakh crore this year; number of returns filed
increased from 3.79 crore to 6.85 crore showing 80% growth in tax base
o Income tax rates - basic exemption limit Rs.2.5 Lakh + tax rebate => no tax payable up to Rs.3 lakh; tax rate for the tax slab
of Rs.2.5 lakh to 5 lakh = 5% (earlier 10%) + Standard Deduction of Rs.40,000 for salaried class + Deduction of savings
under section 80C = Rs.1.5 lakh + Deduction of interest for self-occupied house property = 2 lakh
o Threshold limit for presumptive taxation of business was = Rs. 2 crore; benefit of presumptive taxation extended for first
time to small professionals fixing threshold limit at Rs. 50 lakh; presumptive profit rate reduced from 8% to 6%.
o Tax rate for companies with turnover of up to Rs. 250 crore (>99% companies), reduced to 25%
o 17 different taxes levied by Centre + States/UTs with cascading effect of tax on tax, consolidated into one GST
 Benefits of GST - India became a common market; tax base increased, higher collections, ease of trade; reduced interface
between tax payer and Government; e-way bill system => Inter-state movements faster, more efficient, and hassle free
with no Entry Tax, check posts, and truck queues; burden on the consumer reduced
 Exemptions from GST for small businesses doubled from Rs.20 lakh to 40 lakh + small businesses with turnover up to 1.5
crore given attractive composition scheme wherein they pay only 1% flat rate and file one annual return only; small service
providers with turnover <50 lakhs can opt for composition scheme and pay GST at 6% instead of 18%
 Average monthly tax collection in current year is 97,100 crore per month as compared to 89,700 crore in first year
 Demonetisation effect = 18% growth in direct tax collection in 2017-18 + 1.06 crore first-time income tax returns filers
 Tax Proposals in Interim Budget
o Individual taxpayers with taxable annual income up to Rs. 5 lakhs to get full tax rebate => no income tax; even persons
with income up to 6.50 lakhs may not be paying any income tax if they make investments in provident funds, insurance etc
=> tax benefit of Rs. 18,500 crore to an estimated 3 crore middle class taxpayers
o For salaried persons, Standard Deduction raised from the current Rs. 40,000 to Rs. 50,000
o Currently, income tax on notional rent is payable if one has more than one self-occupied house; now exempt levy of
income tax on notional rent on a second self-occupied house
o Tax deducted at source (TDS) threshold on interest earned on bank/post office deposits raised from Rs. 10,000 to 40,000;
TDS threshold for tax on rent to be increased from Rs. 1,80,000 to 2,40,000
o The benefit of rollover of capital gains under Income Tax Act will be increased from investment in one residential house to
two residential houses for a tax payer having capital gains up to 2 crore; can be availed once in a life time
o For giving impetus to the real estate sector, propose to extend period of exemption from levy of tax on notional rent, on
unsold inventories, from one year to two years, from the end of the year in which the project is completed
 Important terms mentioned in Interim Budget
o Culture of phone banking
o Interest subvention
o Overall Capital Expenditure
o Operating ratio
o Presumptive taxation
o Cascading effect of taxes
o E-way bill system
o GST Council
o Composition scheme for small businesses under GST
o Fiscal consolidation vs Debt consolidation
 Schemes mentioned in Interim Budget
o Pradhan Mantri Gram Sadak Yojana
o Pradhan Mantri Awas Yojana
o Saubhagya Yojna
o Ayushman Bharat
o Pradhan Mantri Jan Aushadhi Kendras
o Aspirational Districts Programme
o Pradhan Mantri KIsan Samman Nidhi (PM-KISAN)
o Soil Health Cards
o Neem Coated Urea
o Rashtriya Gokul Mission and Rashtriya Kamdhenu Aayog
o Kisan Credit Card scheme
o New Pension Scheme(NPS)
o Employee State Insurance Scheme
o Anganwadi and Asha Yojana
o Pradhan Mantri Jeevan Jyoti Bima Yojana
o Pradhan Mantri Suraksha Bima Yojana
o Pradhan Mantri Shram-Yogi Maandhan
o Ujjwala Yojana
o Pradhan Mantri MUDRA Yojana
o Pradhan Mantri Matru Vandana Yojana
o Pradhan Mantri Kaushal Vikas Yojana
o Government e-Marketplace (GeM)
o UDAAN Scheme
o Saubhagya Yojna
o Make in India programme
o Common Service Centres
o Jan Dhan – Aadhaar- Mobile (JAM trinity), Aadhaar scheme, Direct Benefit Transfer
o Digital India
o Integrated Child Development Scheme (ICDS)