With the hope to build on the foundation laid in the last Union Budget, Union Finance Minister Nirmala Sitharaman announced the Budget 2023, which she also called the first Union Budget in the ‘Amrit Kaal’. Beginning with the trend which is being followed by the Indian economy, Sitharaman said that the Indian economy has been recognized as the ‘bright star’ by the world, and is heading on the right track, towards a bright future. She added how our economic growth is expected to be the highest among the major economies of the world, at 7%.
Touching upon the Modi government’s work from 2014, she said how the government’s efforts led to a better quality of life and a life of dignity for all citizens, with the per capita income getting more than doubled to 1.97 lakhs, and during these 9 years, the size of the Indian economy increasing from the 10th largest, to the 5th largest in the world.
With our digital infrastructure being unmatched, and a significant progress in many sustainable development goals, promotion of tourism will now be taken up on a ‘mission mode’, highlighted the finance minister, and added that the government’s vision for the Amrit Kaal includes a technology-driven and knowledge-based economy, with strong public finances and a robust financial sector, and to achieve this, ‘janbhagidari’ (public participation) through ‘sabka saath, sabka prayaas’ is essential.
Sitharaman then focused on the seven priorities, which she called the ‘Saptarishi’, which will guide the country through the Amrit Kaal. Among which, inclusive development, green growth, youth power, and financial power, will be the key players. She mentioned how the Budget 2023 focuses on fulfilling youth aspirations, job creation, and macro-economic stability from an economic perspective.
Talking about the National Rural Livelihood Mission, she highlighted how the same has achieved remarkable success and has mobilized rural women into 1 lakh SHGs. She added how 9.6 crore LPG connections, and 220 crore COVID vaccinations for 102 crore people have been given, along with the opening of 47.8 crore JanDhan accounts.
Under the Budget 2023, an Agriculture Accelerator fund will be set up to encourage agri-start ups by young entrepreneurs. The tourism sector and its development was focus upon, stating how the country offers immense tourist attraction for both domestic and foreign tourists, and how the sector can be a huge potential for success with the scope of increasing job opportunities and entrepreneurship opportunities, especially for the country’s youth.
It is crucial to note that 157 new nursing colleges will be established across the core locations of the country, and in the next three years, 38, 800 teachers and support staffers will be employed for 740 Eklavya Model schools, supporting tribal students. Other than this, to improve social-economic condition of the Particularly Tribal Groups, the PMPBTG Development mission will be launched, to saturate PBTG habitations with basic facilities, and Rs 15,000 crores are to be made available to implement the scheme in the next 3 years. Next, the outlay for the PM Awas Yojana has been increased by 66% to over 79, 000 crores. A national digital library will be set up for children and adolescents, facilitating quality books.
The government has also enhanced the capital expenditure (capex) outlay by 33% to Rs 10 lakh crore which would be 3.3% of the GDP. The amount is almost 3 times the outlay that was made by the government in 2020. 50-year interest free loans will continue for the states, and the Capital investment outlay is being increased steeply for the third year in a row to Rs 10 lakh crore, and the increased capital outlay for infrastructure will crowd in private investment.
In order to enhance the ease of doing business in the country, more than 39,000 compliances have been reduced, and more than 3,400 legal provisions have been de-criminalised. Further, the National Data Governance Policy will be introduced which will enable access to anonymised data. To focus on the development of technology, three centres of excellence for artificial intelligence to enable ‘Make AI for India’ and ‘Make AI work for India’ will be established. To ease out the process of making digital payments, the KYC process will be simplified.
100 critical transport infrastructure projects have been identified for implementation and states and cities will be encouraged to take up urban planning. The Budget also provides for the highest ever railway outlay at 2.4 lakh crores, boosting affordable regional connectivity and logistics of cargo freights, and this figure is 9 times higher than the 2013-14 budget. 50 additional airports, helipads, water aero drones, and advanced landing grounds will be revived to improve regional air connectivity.
The Budge is also focused on the green growth of the country and a target to reach green hydrogen production of 5 MMT by the year 2030 has been set, and Rs 35,000 crores have been allocated towards achieving net zero goal & energy transition. Over the next 3 years, 1 crore farmers will get the assistance to adopt natural farming, and 10,000 bio-input resource centres will be set up. The finance minister also announced the new MISHTI Scheme, under which the government will take up mangrove plantation along the coastline.
30 Skill India international centres will be set up across the states, and to provide support to 47 lakh youths in 3 years, a Direct Benefit Transfer under a pan India national apprenticeship scheme will be rolled out. 100 labs for developing apps using 5G services will be set up in engineering institutions. To realise new range of opportunities, business models and employment potential, labs will cover among others, apps like Smart Classrooms, Precision Farming, Intelligent Transports Systems and Healthcare.
Under the Budget 2023, gold, silver, and diamonds are to get more expensive, along with cigarettes, and the customs on kitchen chimneys are to go down. Fully imported luxury cars and electric vehicles (EVs) in India will now cost more as the government has raised custom duty from 60% to 70% on these items. A benefit of a lower tax rate of 15% will be given to new cooperative societies. The government has introduced new Income Tax return (ITR) forms for easier filing of returns, and the income tax returns processing period has been reduced by 16 days. Under the new tax regime, the government has enhanced the income tax rebate limit up to Rs 7 lakh, and it has proposed to reduce the highest surcharge rate from 37% to 25%. It was also announced that people earning more than 15 lakhs annually will be subject to 30% tax.
There will be no tax for income up to 3 lakhs, and a 5% tax will be charged for an income of between 3-6 lakhs. The finance minister also proposed to hike tax exemption on leave encashment on retirement of non-government salaried employees to Rs 25 lakh from Rs 3 lakh. She also announced a cut in customs duty on the import of certain inputs for mobile phone manufacturing. The government also proposed to extend income tax benefits to start ups incorporated till March 2024. Nirmala Sitharaman also said that the government proposes to increase the benefit of carrying forward losses for start-ups to 10 years.
The limits for micro enterprises and professionals have been enhanced to avail benefits of presumptive taxation and 95% of the receipts to be non-cash. It is also proposed that the new tax regime will be the default tax regime and individuals will have an option to opt for the old tax regime. The FM also proposed to double the deposit limit for Senior Citizen Savings Scheme to Rs 30 lakh and Monthly Income Account Scheme to Rs 9 lakh.
A total of Rs 1.62 lakh crore has been set aside for capital expenditure that includes purchasing new weapons, aircraft, warships and other military hardware. For 2022-23, the budgetary allocation for capital outlay was Rs 1.52 lakh crore but the revised estimate showed the expenditure at Rs 1.50 lakh crore. According to 2023-24 budget documents, an allocation of Rs 2,70,120 crore has been made for revenue expenditure that includes expenses on payment of salaries and maintenance of establishments. The budgetary allocation of revenue expenditure in 2022-23 was Rs 2,39,000 crore. In the budget for 2023-24, the capital outlay for the Ministry of Defence (Civil) has been pegged at Rs 8,774 crore while an amount of Rs 13,837 crore has been set aside under capital outlay.
The first budget of the Amrit Kaal is worth appreciating because this is a budget which focuses on the holistic development of the country and is a budget for all the sectors in India. It covers and aims at the growth of all the major pillars of development for our country, which are, agriculture, entrepreneurship, tourism, healthcare, education, housing, business, technology and innovation, transport infrastructure and connectivity, green growth and sustainable development, and finally, skill-development.