Key Highlights of the Union Budget 2022-23

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Key Highlights of the Union Budget 2022-23
Key Highlights of the Union Budget 2022-23

Hello friends, here is the “Key Highlights of the Union Budget 2022-23“, important for upcoming competitive exms.  Here we include only the factua data which is important for exam point of view. We have highlighted the important points for your convenience.

Table of Contents

Budget 2022-2023, Key Highlights

Introduction

India’s economic growth in the current year is estimated to be 9.2%, highest among all large economies.

• The Productivity Linked Incentive (PLI) scheme creates 6 million new jobs, and has the potential to generate an additional 30 trillion over the next 5 years.

• India entered into AmritKaal, the 25-year-long leadup to India@100.

• This budget continues to provide incentives for growth with the following four priorities

  1. PM GatiShakti
  2. Inclusive Development
  3. Productivity Enhancement & Investment, Sunrise opportunities, Energy Transition, and Climate Action
  4. Financing of Investments

PM GatiShakti

Driven by seven engines, namely, Roads, Railways, Airports, Ports, Mass Transport, Waterways, and Logistics Infrastructure.

• These 7 engines in the National Infrastructure Pipeline will be aligned with PM GatiShakti framework.

Road Transport

• PM GatiShakti Master Plan for Expressways will be formulated in 2022-23.

• The National Highways network will be expanded by 25,000 km in 2022-23.

Multimodal Logistics Parks

• The data exchange among all mode operators will be brought on Unified Logistics Interface Platform (ULIP), designed for Application Programming Interface (API).

• Contracts for implementation of Multimodal Logistics Parks at four locations through PPP mode will be awarded in 2022-23.

Railways

‘One Station-One Product’ concept will be popularized to help local businesses & supply chains.

• As a part of Atmanirbhar Bharat, 2,000 km of network will be brought under Kavach.

400 new-generation Vande Bharat Trains will be manufactured during the next three years.

One hundred PM GatiShakti Cargo Terminals for multimodal logistics facilities will be developed during the next three years.

Parvatmala: National Ropeways Development Programme

National Ropeways Development Programme will be taken up on PPP mode in difficult hilly areas.

Contracts for 8 ropeway projects for a length of 60 km will be awarded in 2022-23.

 Inclusive Development

Agriculture

• The procurement of 1208 lakh metric tonnes of wheat and paddy from 163 lakh farmers.

• Direct payment of 2.37 lakh crore of MSP value to the 1.63 crore farmers.

• Promoting chemical free natural farming starting with farmers’ lands close to river Ganga in 5-km wide corridors.

• 2023 has been announced as the International Year of Millets.

• The use of ‘Kisan Drone’ for crop assessment, digitization of land documents, pesticide sprays and nutrition will be promoted.

• Key focus on Modern-day agriculture, Natural, Zero-budget and Organic farming.

Ken Betwa project and Other River Linking Projects

• Implementation of the Ken-Betwa Link Project, at an estimated cost of ` 44,605 crore will be taken up.

♦  Key benefits from Ken-Betwa Link Project.

• It provides irrigation benefits to 9.08 lakh hectare of farmers

• Supply of drinking water for 2 million people

• Production of 103 MW Hydroelectric energy.

• It will help generate 27 MW of solar power.

• Detailed Project report of linking of another 5 rivers, namely Damanganga-Pinjal, Par-Tapi- Narmada, Godavari-Krishna, Krishna-Pennar and Pennar-Cauvery has been finalized.

Food Processing

• By providing a comprehensive package, the Government of India will encourage farmers to adopt suitable varieties of fruits and vegetables using appropriate production and harvesting techniques.

MSME

Udyam, e-Shram, NCS and ASEEM portals will be interlinked.

• All the portals will now perform with live, organic databases, providing G2C (Government to Citizen), B2C (business-to-consumer) and B2B (Business-to-business) services.

• Emergency Credit Line Guarantee Scheme (ECLGS) has provided much-needed additional credit to more than 130 lakh MSMEs to mitigate the adverse impact of the COVID-19 pandemic.

• The Emergency Credit Line Guarantee Scheme (ECLGS) will be extended up to March 2023.

Credit Guarantee Trust for Micro and Small Enterprises (CGTMSE) scheme will be facilitate additional credit of  2 lakh crore for MSMEs.

Raising and Accelerating MSME Performance (RAMP) programme with outlay of  6,000 crore over 5 years will be rolled out.

Skill Development

Digital Ecosystem for Skilling and Livelihood (DESH-Stack e-portal) will be launched to promote online training.

• Startups will be promoted to facilitate Drone Shakti for Drone-As-A-Service.

Universalization of Quality Education

One class One TV channel programme to be expanded to 200 TV channels.

• A Digital University will be established with world class quality universal education.

750 Virtual labs in science and mathematics.

75 skilling e-labs to promote critical thinking skills and stimulated learning environment.

High quality e-content will be delivered through Digital Teachers.

High-quality e-content in all spoken languages will be developed for delivery via internet, mobile phones, TV and radio through Digital Teachers.

National Tele Mental Health Programme

• To better the access to quality mental health counselling and care services, a ‘National Tele Mental Health Programme’ will be launched.

• This will include a network of 23 tele-mental health centres of excellence, with NIMHANS (National Institute of Mental Health and Neurosciences).

• Technology support for the tele-mental health centres of excellence provided by International Institute of Information Technology-Bangalore (IIITB).

Mission Shakti, Mission Vatsalya, Saksham Anganwadi & Poshan 2.0

• Three schemes, namely, Mission Shakti, Mission Vatsalya, Saksham Anganwadi and Poshan 2.0 were launched recently.

• Two lakh anganwadis will be upgraded under the Scheme.

HarGhar, Nal Se Jal

• Current coverage of HarGhar, Nal Se Jal is 8.7 crores.

• Allocation of 60,000 crore has been made with an aim to cover 3.8 crore households in 2022-23.

Housing for All

• 80 lakh houses to be completed in 2022-23 under PM Awas Yojana.

• 48,000 crore is allocated for this purpose.

Prime Minister’s Development Initiative for North East Region (PM-DevINE)

• A new scheme, Prime Minister’s Development Initiative for North-East, (PM-DevINE), will be implemented through the North-Eastern Council.

• It will fund infrastructure, in the spirit of PM GatiShakti, and social development projects based on felt needs of the North-East.

• An initial allocation of 1,500 crore will be made, for the projects under the Initiatives for North-East India.

Aspirational Blocks Programme

• Target to improve the quality of life of citizens in the most backward districts of the country through Aspirational Districts Programme.

• 95 per cent blocks of 112 districts have made significant progress in key sectors such as health, nutrition, financial inclusion and basic infrastructure.

• In 2022-23, the programme will focus on lagged blocks in remaining districts.

Vibrant Villages Programme

• Through this programme the government will develop the Border villages which have sparse population, limited connectivity and lack of proper infrastructure.

• The development activities will include construction of village infrastructure, housing, tourist centres, road connectivity, provisioning of decentralized renewable energy, direct to home access for Doordarshan and educational channels, and support for livelihood generation.

Anytime – Anywhere Post Office Savings

• In 2022, 100 per cent of 1.5 lakh post offices will come on the core banking system.

• All the post office can offer the basic banking features such as access to accounts through net banking, mobile banking, ATMs, and also provide online transfer of funds between post office accounts and bank accounts.

Digital Banking

• Proposed to set up 75 Digital Banking Units (DBUs) in 75 districts of the country by Scheduled Commercial Banks.

Digital Payments

•The financial support for digital payment ecosystem announced in the previous Budget will continue in 2022-23.

Productivity Enhancement & Investment, Sunrise Opportunities, Energy Transition, and Climate Action

Productivity Enhancement & Investment

Ease of Doing Business 2.0 & Ease of Living

• In recent years, over 25,000 compliances were reduced and 1486 Union laws were repealed.

• For the AmritKaal, the next phase of Ease of Doing Business EODB 2.0 and Ease of Living, will be launched.

Green Clearances

• A single window portal, PARIVESH, for all green clearances was launched in 2018.

• It has been instrumental in reducing the time required for approvals significantly.

• It will enable application for all four approvals through a single form, and tracking of the process through Centralized Processing Centre-Green (CPC-Green).

e-Passport

• e-Passports with embedded chip and futuristic technology will be rolled out.

Urban Development

• For urban capacity building, support will be provided to the states.

• Modernization of building bye laws, Town Planning Schemes (TPS), and Transit Oriented Development (TOD) will be implemented.

• AMRUT scheme will be leveraged for formulation of action plans and their implementation for facilitating TOD and TPS by the states.

• AICTE will take the lead to improve syllabi, quality and access of urban planning courses in institutions.

Clean & Sustainable Mobility

• Focus on special mobility zones with zero fossil-fuel policy, and EV vehicles.

• The private sector will be encouraged to develop sustainable and innovative business models for ‘Battery or Energy as a Service’.

Land Records Management

• States will be encouraged to adopt Unique Land Parcel Identification Number to facilitate IT-based management of records.

• The facility for transliteration of land records across any of the Schedule VIII languages will also be rolled out.

• The adoption or linkage with National Generic Document Registration System (NGDRS) with the ‘One-Nation One-Registration Software’ will be promoted as an option for uniform process for registration and ‘anywhere registration’ of deeds & documents.

Telecom Sector

• Implementation of 5G technology within 2022-23 by private telecom providers.

• For that required spectrum auctions will be conducted in 2022.

• To promote R&D and cheap internet service, 5% of annual collections under the Universal Service Obligation Fund will be allocated.

• The contracts for laying optical fibre in all villages, including remote areas, will be awarded under the Bharatnet project through PPP in 2022-23.

• Completion is expected in 2025. Measures will be taken to enable better and more efficient use of the optical fibre.

Export Promotion

• The Special Economic Zones Act will be replaced with a new legislation that will enable the states to become partners in ‘Development of Enterprise and Service Hubs’.

• This will cover all large existing and new industrial enclaves to optimally utilise available infrastructure and enhance competitiveness of exports.

Atma Nirbharta in Defence

• 68 per cent of the capital procurement budget will be earmarked for domestic industry in 2022-23, up from 58% in 2021-22.

• Defence R&D will be opened up for industry, startups and academia with 25% of defence R&D budget earmarked.

Sunrise Opportunities

• Artificial Intelligence, Geospatial Systems and Drones, Semiconductor and its eco-system, Space Economy, Genomics and Pharmaceuticals, Green Energy, and Clean Mobility Systems have immense potential to assist sustainable development at scale and modernize the country.

Energy Transition  

Solar Power

• Target to produce 280 GW of installed solar capacity by 2030.

• For the ambitious goal an additional amount of 19,500 crore under Production Linked Incentive scheme will be provided.

Climate Action

Transition to Carbon Neutral Economy

• 5 -7 per cent biomass pellets will be co-fired in thermal power plants resulting in CO2 savings of 38 MMT annually.

• Four pilot projects for coal gasification and conversion of coal into chemicals will be set-up to evolve technical and financial viability.

• Financial support will be provided to farmers belonging to Scheduled Castes and Scheduled Tribes, who want to take up agro-forestry.

Financing of Investments

Public Capital Investment

• Capital expenditure in the Union Budget is stepped up sharply by 35.4 per cent from 5.54 lakh crore in the current year to 7.50 lakh crore in 2022-23.

• This has increased to more than 2.2 times the expenditure of 2019-20.

• This outlay in 2022-23 will be 2.9 per cent of GDP.

Effective Capital Expenditure

•The ‘Effective Capital Expenditure’ of the Central Government is estimated at 10.68 lakh crore in 2022-23, which will be about 4.1 per cent of GDP.

GIFT-IFSC

• World-class foreign universities and institutions will be allowed in the GIFT City to offer courses in Financial Management, FinTech, Science, Technology, Engineering and Mathematics.

• An International Arbitration Centre will be set up in the GIFT City for timely settlement of disputes under international jurisprudence.

• Services for global capital for sustainable & climate finance in the country will be facilitated in the GIFT City.

Digital Rupee

• Introduction of Central Bank Digital Currency (CBDC) using blockchain and other technologies, it will give a big boost to digital economy.

Financial Assistance to States for Capital Investment

• Financial Assistance of 1 lakh crore will be allocated to the states in catalysing overall investments in the economy.

• In 2022-23, in accordance with the recommendations of the 15th Finance Commission, the states will be allowed a fiscal deficit of 4 per cent of GSDP of which 0.5 per cent will be tied to power sector reforms.

Fiscal Management

• Total expenditure in 2022-23 is estimated at `39.45 lakh crore.

• Total receipts other than borrowings are estimated at 22.84 lakh crore.

• The revised Fiscal Deficit in the current year is estimated at 6.9 per cent of GDP as against 6.8 per cent projected in the Budget Estimates.

• The Fiscal Deficit in 2022-23 is estimated at 6.4 per cent of GDP.

• Planning to reach a fiscal deficit level below 4.5 per cent by 2025-26.

Direct Tax

Reduced Alternate minimum tax rate and Surcharge for Cooperatives

• Currently, cooperative societies are required to pay Alternate Minimum Tax at the rate of eighteen and one half per cent.

• However, companies pay the same at the rate of fifteen per cent.

• Proposal to reduce the surcharge on co-operative societies from present 12 per cent to 7 per cent for those having total income of more than 1 crore and up to 10 crores.

Parity between employees of State and Central government

• At present, the Central Government contributes 14 per cent of the salary of its employee to the National Pension System (NPS) Tier-I.

Incentives for Start-ups

• Eligible start-ups established before 31.3.2022 had been provided a tax incentive for three consecutive years out of ten years from incorporation.

 Incentives for newly incorporated manufacturing entities under concessional tax regime

• In an effort to establish a globally competitive business environment for certain domestic companies, a concessional tax regime of 15 per cent tax was introduced by our government for newly incorporated domestic manufacturing companies.

Scheme for taxation of virtual digital assets

• Any income from transfer of any virtual digital asset shall be taxed at the rate of 30 per cent.

• Gift of virtual digital asset is also proposed to be taxed in the hands of the recipient.

Clarification in relation to ‘Health and Education cess’ as business expenditure

• The ‘Health and Education Cess’ is imposed as an additional surcharge on the taxpayer.

• However, some courts have allowed ‘Health and education ‘cess’ as business expenditure, which is against the legislative intent.

Indirect taxes

Project imports and capital goods

National Capital Goods Policy, 2016 aims at doubling the production of capital goods by 2025.

Gems and Jewellery

• Customs duty on cut and polished diamonds and gemstones is being reduced to 5 per cent.

• Simply sawn diamond would attract nil customs duty.

• The customs duty on imitation jewellery is being prescribed in a manner that a duty of at least 400 per Kg is paid on its import.

Chemicals

• Customs duty on certain critical chemicals namely methanol, acetic acid and heavy feed stocks for petroleum refining are being reduced.

• While duty is being raised on sodium cyanide for which adequate domestic capacity exists.

MSME

• Duty on umbrellas is being raised to 20 per cent. Exemption to parts of umbrellas is being withdrawn.

• Customs duty exemption given to steel scrap last year is being extended for another year to provide relief to MSME secondary steel producers.

• Certain Anti- dumping and CVD on stainless steel and coated steel flat products, bars of alloy steel and high-speed steel are being revoked in larger public interest considering prevailing high prices of metals.

Exports

• To incentivise exports, exemptions are being provided on items such as embellishment, trimming, fasteners, buttons, zipper, lining material, specified leather, furniture fittings and packaging boxes.

• Duty is being reduced on certain inputs required for shrimp aquaculture so as to promote its exports.

Tariff measure to encourage blending of fuel

• Unblended fuel shall attract an additional differential excise duty of 2/ litre from the 1st day of October 2022.

Source: Indiabudget


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