This Article is From Feb 02, 2021

From Agriculture To Defence: Sector-Wise Highlights Of Finance Minister's Budget 2021

Budget 2021 India Highlights: The Finance Minister projected a fiscal deficit of 6.8 per cent of gross domestic product for 2021-22, while the current year is expected to end with a deficit of 9.5 per cent

From Agriculture To Defence: Sector-Wise Highlights Of Finance Minister's Budget 2021

Budget 2021 Highlights: The Finance Minister presented the ninth budget of Modi government on February 1

Budget 2021: Finance Minister Nirmala Sitharaman presented Budget 2021 on February 1, 2021, in the Lok Sabha, aimed at reviving the economy battered by the coronavirus pandemic. Ms Sitharaman said that the country's healthcare spending would be doubled to Rs 2,23,846 crore and added that Rs 35,000 crore would be spent on COVID-19 vaccines. Budget 2021 also announced infrastructure projects for poll-bound states of West Bengal, Kerala, Tamil Nadu, and Assam. Amid the COVID-19 pandemic, the Finance Minister said that the budget was prepared in circumstances like never before.

Budget 2021: Here Are The Key Sector-Wise Highlights

  1. Healthcare: Finance Minister Nirmala Sitharaman on Monday proposed more than doubling the healthcare spending to Rs 2.2 lakh crore. Out of this, an amount of ₹ 35,000 crore has been allocated for developing COVID-19 vaccines. (Also ReadBudget: Focus On Health, Farmers, Polls; Relief For Seniors Above 75 )

  2. Agriculture: The government increased the target for agricultural credit to Rs 16.5 lakh crores to ensure the availability of higher credit to farmers and for animal husbandry, dairy and fisheries sector. The allocation for rural infrastructure development fund is proposed to be increased to Rs 40,000 crore by 2021-22

  3. Automobile: The government introduced a new voluntary vehicle scrappage policy to replace old vehicles in order to boost demand for newer and less polluting vehicles. The basic customs duty rate of certain auto components is increased from 10 per cent to 15 per cent

  4. Defence: The Finance Minister allocated a sum of Rs 1,35,060 crore of capital expenditure and Rs 2,12,027 crore of revenue expenditure for the defence sector. In Budget 2021, there is an increase of 18.75 per cent in capital defense expenditure over last year's budget. 

  5. Infrastructure: The government increased capital expenditure for 2021-22 by 34.5 per cent to Rs 5.5 lakh crore to push growth through infrastructure creation. Budget 2021 allocated Rs 1.1 lakh crore for Indian Railways. The government also proposed setting up the development financial institution with an allocation of Rs 20,000 crores for funding infrastructure projects

  6. Real Estate: The Finance Minister introduced a tax holiday for notified affordable rental housing projects. The affordable housing projects has been approved up to March 31, 2022, which was earlier March 31, 2021, and is eligible for a tax holiday

  7. Technology: The government announced an allocation of Rs 1,500 crores to promote digital payments. The government also announced zero-rating benefits in case of supplies made to SEZ units where supplies used for authorized operations.

  8. Finance: The Finance Minister announced an increase in foreign direct investment (FDI) limit in insurance sector from 49 per cent to 74 per cent with additional control and safeguard. Ms Sithraman announced that compliance burden will be reduced for citizens aged 75 years and above. Senior citizens with only one pension and interest scheme are exempted from filing income tax returns.

  9. Banking: The government announced allocated a sum of Rs 20,000 crore for public sector banks (PSBs) in 2021-22 to meet regulatory norms. For the current financial year, the government had made a provision of Rs 20,000 crore for recapitalisation.  

  10. Startups: The government increased the turnover threshold for tax audit of account from Rs 5 crores to Rs 10 crores, where 95 per cent of receipts and payments are executed through digital modes. The eligibility period for incorporating an eligible start-up has been extended by one more year, subject to other conditions. A startup incorporated on or before 1 April 2022 can now claim income tax holiday.