HIGHLIGHTS OF UNION BUDGET 2014-2015

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The Union Budget of India for 2014-2015 was presented by the Finance Minister of India, Arun Jaitley on July 10, 2014 at precisely 11 am at the Sansad Bhawan in the national capital. This was the first union budget of the Narendra Modi-led NDA government. The Wholesale Price Index(WPI) of consumer goods fell considerably from 4.5 percent in August 2014 to 1 percent in October 2014. It further depreciated to the zero mark in November and -0.2 percent in December 2014, paving the way for fears of deflation.

In an developing economy, neither inflation nor deflation is good, which leads to financial burden on a country’s economy. At this, the central government modified some policies, owing to the brief deflation period. However, the WPI increased marginally to 0.4% in January this year, due to the falling of crude oil prices globally. Keeping in mind, the topsy-turvy nature of the Indian economy, the budget is also a continuation of the interim budget announced by former finance minister, P. Chidambaram in 2013, which was the Congress-led UPA government’s rule at the Centre at that time.

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Many prominent leaders were not satisfied with the presentation and contents of the budget. However, various business personalities and global leaders appreciated the budget and quoted that – ‘The Economy of India was moving at the right path.’ The highlights of the Union Budget have been jotted down below which are as follows:-

  • Rs. 70.6 billion will be provided for the development of 100 smart cities of India by 2025.
  • Establishing five New IITs(Indian Institute of Technology) and IIMs(Indian Institute of Management) and four new AIIMS(All India Institute of Medical Sciences) in various cities of India.
  • Establishing a new airport scheme for Tier I and Tier II cities in India.
  • New schemes will be introduced for development of sports across the country.
  • FDI(Foreign Directive Investment) in Defence and Insurance Sector has been increased to 49% from 26%.
  • FDI in real estates needed for low cost housing for the poor.
  • No changes in personal income tax slabs. But tax exemption limit has been increased to Rs. 250,000 from Rs. 200,000 for those below the age of 60.
  • Income Tax exemption limit for senior citizens has been raised to Rs. 300,000.
  • Housing Loan interest rate deduction limit has been increased to Rs. 200,000 onwards.
  • Two years of sub-five per cent growth has led to challenges to the Economy of India.
  • Slow decision making has resulted in loss of opportunities of the people.
  • The government will usher in new policy regime and ensure lower levels of inflation within the next financial year(2015-16).
  • It is aimed to achieve 7-8 percent economic growth rate in next 3-4 years and will leave no stone unturned to create a vibrant India.
  • Budget proposes Plan Expenditure of Rs. 5.75 trillion for the current fiscal year of 2014-15.
  • New anti-poverty programmes will be enforced. Some UPA policies will continue to function as it is.
  • There is a need to revive the growth particularly in the manufacturing sector and its infrastructural development. Also, there is urgent need to generate more resources for continued mass production.
  • The current Finance Minister will emphasize on fiscal prudence wholly.
  • The ISIS menance in Iraq and Syria has created a crisis on rising crude oil prices, which is hampering the economy.
  • The problem of black money will be fully resolved and every penny of it will be returned back to India.
  • A new Expenditure Management Commission will be constituted to look at expenditure reforms.
  • Overall subsidy regime will be reviewed, especially food and oil. Marginalised sections of the society will be protected and benefitted.
  • A new Urea Policy will be formulated for agricultural boost.
  • The government will not ordinarily change policies retrospectively which creates a fresh liability.
  • All future indirect transfers under the retro tax regime will be scrutinised with immediate effect.
  • Government committed to providing a stable tax regime which is investor friendly.
  • Government will set up a high-level committee to interact with the industries to bring about changes in tax laws, if required.
  •  Proposal to enhance the scope of Income Tax Settlement Commission.
  • Government proposes to strengthen authority for advance ruling in tax.
  • Our domestic manufacturing is still at nascent stage. Also, manufacturing units will be allowed to sell their products through retail and e-commerce.
  • Our banking system needs to be further strengthened and there is a need to infuse Rs. 2.4 trillion in our banks.
  • Bank capital will be raised through retail sale of shares and government will continue to hold majority in PSU banks.
  • E-visas will be introduced at nine airports in the country.
  • Rs. 50 crores will be set aside for indigenous cattle breed and Blue Revolution for inland fisheries.
  • The ‘Swachh Bharat Abhiyan’ will be enforced and the government pledges for total sanitation under this programme by 2020.
  • Rs. 10 billion will be reserved for Pradhan Mantri Krishi Seechai Yojana to improve irrigation facilities for agricultural boost.
  • National multi-scale programme ‘Skill India’ will be introduced to provide training and support for employment opportunities.
  • The ‘Deen Dayal Upadhaya Gram Jyoti Yojana’ will be be launched to augment uninterrupted power supply in rural areas.
  • Rs. 2 billion set aside for Statue of Unity(Sardar Patel’s statue) project in Gujarat, to be completed by 2017.
  • EPFO(Employees Provident Fund Organisation) will launch a unified account scheme for portability of Provident Fund Accounts.
  • Proposal to set up committee to examine how to utilise large funds lying unused in postal schemes.
  • Government proposes to set up 15 new Braille press and revive 10 existing ones for disabled persons.
  • Rs. 143.89 billion will be provided for the ‘Pradhan Mantri Gram Sadak Yojana’.
  • Rs. 1 billion set aside for the launching of ‘Beti Bachao, Beti Padhao’ Scheme.
  • Crisis Management Centres for women will be set up at all government hospitals in the National Capital Region of India.
  • Rs. 36 billion will be provided for safe drinking water in 20,000 habitations in villages facing problem of impure drinking water.
  • Budget proposes the ‘National Housing Banking Scheme’ and allots Rs. 80 billion for it.
  • Rs. 2.29 trillion will be allocated for the Defence Budget.
  • Government proposes to add 12 more medical government colleges.
  • A ‘Kisan TV Channel’ will be aired by the Doordarshan and Community Radio Stations will be developed for Rs. 2 billion.
  • Rs. 5 billion set aside for establishing the National Rural Internet and Technology Mission for high Internet penetration.
  • Metro Rail services will be launched in the cities of Mumbai, Ahmedabad, Kochi, Hyderabad, Chennai, Faridabad, Jaipur, Kolkata, Nagpur and Lucknow.
  • Budget proposes to set up agri-infrastructure funds and two more agri-research institutes in Jharkhand and Assam at a cost of Rs. 1 billion.
  • Government announces Rs. 5 billion for modernisation and upgradation of all madrasas.
  • Rs. 1 billion will be allotted for providing soil cards to every farmer.
  • Government committed to achieve 4 percent farm growth and to use new technologies to boost crop yields.
  • Education-cess for all taxpayers including corporates will continue.
  • Restructuring Food Corporation of India to be taken up on priority basis.
  • Budget proposes Rs. 200 billion for setting up 2000 producers’ organisations across the country.
  • Kakinada port and its adjoining areas will be developed smartly.
  • Trade facilitation centres will be set up at a cost of Rs. 500 million to help the handloom development.
  • India has emerged as the largest PPP market in the world.
  • Rs. 300 crores provided for 6 more textile clusters in Rae Bareilly, Lucknow, Surat, Bhagalpur, Mysore and Madurai.
  • Government sets aside Rs. 500 million for Pashmina Production programme in Jammu & Kashmir.
  • 1620-km Ganga inland waterway development from Haridwar to Haldia will be completed in 6 years at a cost of Rs. 42 billion.
  • New airports to be developed through PPP mode and coal linkages will be rationalised to reduce power cost.
  • Rs. 42 billion set aside for Jal Marg Vikas project on river Ganga connecting Allahabad to Haldia.
  • Rs. 5 billion will be provided for ultra modern solar power plants in Rajasthan, Tamil Nadu and Ladakh in Jammu and Kashmir.

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  • Use of piped cooking gas will be promoted on a trial basis initially.
  • CRT(Cathode Ray Tube) TVs exempted from customs duty to help the needy.
  • Basic custom duties on LCDs and LEDs below 19 inch have been reduced to zero from 10 percent.
  • Changes in the Mines and Mineral Regulation and Development Act will be introduced. Also, royalty on minerals will be reviewed to enhance revenue for states.
  • Government proposes to develop 15,000 km additional gas pipeline through PPP mode.
  • Clarification on tax treatment of foreign funds will be announced.
  • Banks will be permitted to raise long term funds without regulatory hindrances.
  • RBI(Reserve Bank of India) will frame a policy for licensing of small and differential banks.
  • Rs. 1 billion technology development fund has been proposed in the budget.
  • Government sets aside Rs. 22.5 billion to upgrade the weather monitoring infrastructure.
  • Rs. 1 billion will be allocated for War Memorial and War Museum at Princess Park, near the India Gate in New Delhi.
  • Rs. 500 million will be provided for setting up of a National Police Memorial.
  • Rs. 1 billion will be allocated for preserving heritage characters of cities like Mathura and Agra.
  • Government announces Rs.1 billion for development of archaeological sites. Gaya will be developed as world class tourist spot.
  • Rs. 500 million set aside for modernisation of Ghats in places like Varanasi and Patna.
  • NRI fund for conservation of river Ganga will be set up shortly.
  • Rs. 2 billion allotted for upgrading indoor and outdoor stadiums in Jammu and Kashmir.
  • Budget proposes to set up a sports university in Manipur and Mizoram.
  • Rs. 1 billion set aside for training on sportspersons for the Asian Games 2018.
  • Rs. 5 billion will be provided for rehabilitation of displaced Kashmiri migrants.
  • Rs. 1 billion set aside for development of organic farming in the North-Eastern region of India.
  • Government will provide Rs. 10 billion for linked rail connectivity in the North-East.
  • Government will launch an ‘Arun Prabha’ channel, which is a 24X7 Channel for the North-East.
  • 10-year tax holiday will be extended to companies that start power generation by March 31, 2017.
  • Concessional rate of 15 percent on dividends will continue as such.
  • Government will review revised Direct Taxes Code taking into account comments from stakeholders.
  • Government will enforce a new scheme known as the ‘Jan Dhan Yojana’, which will help poor farmers to open a bank account and get subsidised offers of goods and services.
  • The Planning Commission of India, will be replaced by a new planning body known as the ‘NITI Aayog'(National Institution for Transforming India Aayog) for holistic and overall economic development of the country and along with the states and union territories of India, with effect from January 1, 2015.
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2 thoughts on “HIGHLIGHTS OF UNION BUDGET 2014-2015

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