Union Finance Minister Nirmala Sitharaman on Wednesday presented Union Budget 2023-24 in the Parliament. All eyes were on the Budget as it is the last full-fledged Budget ahead of the general elections in 2024.
Here are the highlights of the Budget speech.
Finance Minister Nirmala Sitharaman on Wednesday delivered a pragmatic, part-populist yet growth-oriented budget, giving a special big push for capital expenditure and warming the hearts of middle-class income taxpayers with tax slab overhaul ahead of the 2024 general elections and nine state assembly elections this year.
The income tax relief measures were particularly targeted at the middle class, and senior citizens through rejig in basic income exemption limits and a reduction in the number of income tax slabs from six to five. Put simply, a citizen earning income up to ₹7 lakh need not fork out any income tax in the new tax regime.
In her fifth consecutive budget, the last full-fledged budget of this government, amplifying the tone of populism towards the middle class, Sitharaman rejigged income slabs are ₹0-3 lakh —Nil; ₹3-6 lakh —5 percent; ₹6-9 lakh —10 percent; ₹9-12 lakh —15 percent; ₹12-15 lakh —20 percent and ₹ 15 lakh and above —30 percent.
Presenting the Budget, the Finance Minister said that the government ensured that no one went hungry during the pandemic by providing free foodgrains to 80 crore poor people.
Finance Minister said that all cities and towns will be enabled for 100 per cent transition of sewers and septic tanks from manhole to machine hole mode. Cities will also be encouraged to increase creditworthiness for municipal bonds, the minister said.
India’s ongoing presidency of the G-20 grouping is a unique opportunity to strengthen the country’s role in the world economic order when countries across the globe are facing various challenges, Finance Minister Nirmala Sitharaman said while presenting the Budget
Digital public infrastructure for agriculture will be built as an open source, open standard on mission mode, and an interoperable public good, Finance Minister Nirmala Sitharaman announced presenting the Budget for 2023-24.
She said it will help in crop planning and facilitate easy access to inputs and credit for farmers apart from supporting agritech industry and start-ups in crop estimation and market intelligence activities.
Terming millets as “Shri Anna”, Sitharaman said India is at the forefront of popularising the nutri cereals and announced that the Hyderabad-based Indian Institute of Millet Research will be promoted as a centre of excellence of international standards for sharing best practices in research and technology.
Finance Minister Nirmala Sitharaman has announced that the capital expenditure will go up by 33 per cent to ₹10 lakh crore for infrastructure development for 2023-24 and will be at 3.3 per cent of the GDP.
Presenting the Budget for 2023-24, she said the newly established infrastructure finance secretariat will assist in attracting more private investment.
An expert committee will also be set up to make infrastructure classification and financing framework suitable for Amrit Kaal, she added.
The Union Budget 2023-24 has allocated ₹79,000 crore for the Pradhan Mantri Awas Yojana (PMAY), giving a further boost to the government’s housing programme for urban poor.
Finance Minister Nirmala Sitharaman, while presenting the Budget, said outlay of PMAY is being enhanced by 66 per cent to over ₹79,000 crore.
Presenting the Budget 2023-24, the Finance Minister has laid down the seven pillars or ‘ Saptarishi’ to usher growth and development.
Reaching Last Mile.
The Centre’s move to halve the basic customs duty on specified parts of open cells of TV panels to 2.5 per cent will help make LED Televisions cheaper for consumers.
Finance Minister Nirmala Sitharaman in her budget speech stated that this is being done to promote value addition in the manufacturing of television. Earlier, the basic customs duty on these specified parts of open cells for TV panels was at 5 per cent.
Major TV makers are expected to reduce prices by 3-5 per cent.
The Union Budget for the financial year beginning April 2023 has proposed an allocation of ₹35,000 crore for energy transition initiatives.
“This Budget provides ₹35,000 crore for priority capital investments towards energy transition and net-zero objectives, and energy security by the Ministry of Petroleum & Natural Gas (MoPNG),” Finance Minister Nirmala Sitharaman said in her budget speech on Wednesday.
India will make operational 50 new airports, helipads, and aerodromes to improve regional connectivity, Finance Minister Nirmala Sitharaman announced while presenting the Union Budget 2023-24.
“50 additional airports, aerodromes, helipads, and water routes to be built to enhance connectivity,” she said.
Finance Minister Nirmala Sitharaman has announced an outlay of ₹2.4 lakh crore for the Indian Railways in the Union Budget 2023-24. This, incidentally, is the largest allocation in almost a decade and four times last year’s budget.
“This is about nine times the outlay made in 2013-14,” the finance minister said, comparing it with a time when the Congress-led UPA was in power.
Technology adoption will get a further boost with the Finance Minister Nirmala Sitharaman announcing a slew of initiatives in the Union Budget 2023-24 such as building a digital public infrastructure and creation of an agriculture accelerator fund on Wednesday.
“Digital public infrastructure for agriculture will be built as an open source, open standard and inter operable public good. This will enable six inclusive, farmer-centric solutions through relevant information services for crop planning and health, improved access to farm inputs, credit, and insurance, help for crop estimation, market intelligence, and support for growth of agri-tech industry and start-ups,” Sitharaman said.
Budget 2023 proposed multiple benefits for start-ups, including extending the date of incorporation for income tax benefits till March 2024, a national data governance policy, and relief to start-ups in carrying forward and setting off of losses, among other announcements.
In her fifth budget speech, the Finance Minister Nirmala Sitharaman said, “Entrepreneurship is vital for a country’s economic development. We have taken a number of measures for start-ups and they have borne results. India is now the third largest ecosystem for start-ups globally, and ranks second in innovation quality among middle-income countries.”
In the year of the International Year of Millets, the Hyderabad-based Indian Institute of Millets Research (IIMR), which is leading a millet revolution in the country, gets a further facelift.
Presenting the Union Budget 2023-24 on Wednesday, Union Finance Minister Nirmala Sitharaman has said that the institute will act as a Centre of Excellence (CoE) for ‘Shree Anna’ to take the research on millets to the international level and make India a global hub for millets.
The Union Budget 2023-24 has witnessed a surge in allocation for education. The highest allocation ever, it has earmarked a total of ₹1.12 lakh crore to the Ministry of Education. This is a 13 per cent increase from FY23’s revised allocation of ₹0.99 lakh crore.
While ₹68,804.85 crore has been allocated for school education and literacy, the Department of Higher Education gets ₹44,094.62 crore. While the National Education Policy 2020 seeks to spend 6 per cent of the GDP on education, the budget is yet to see that level of allocation, despite a hike.
Equity benchmarks Sensex and Nifty ended on a mixed note on Wednesday as the euphoria about the Budget fizzled out, with investors going for profit-taking ahead of the Fed interest rate decision.
The 30-share BSE benchmark Sensex climbed 158.18 points or 0.27 per cent to settle at 59,708.08 after it trimmed most of the intra-day gains. During the day, it had zoomed 1,223.54 points or 2 per cent to 60,773.44.
In contrast, the broader NSE Nifty declined 45.85 points or 0.26 per cent to end at 17,616.30.
The rupee pared initial gains and settled 2 paise lower at 81.90 (provisional) against the US dollar on Wednesday after Finance Minister Nirmala Sitharaman presented the Union Budget for 2023-24.
Forex traders said investors stayed on the sidelines, as they are waiting for the outcome of the US Federal Reserve meeting later in the evening.
At the interbank foreign exchange market, the rupee opened at 81.76 against the greenback and finally settled at 81.90, down 2 paise over its previous close.
During the session, the rupee touched an intraday high of 81.68 and a low of 82.03 against the American currency.
The Budget has brought distributions made by Real Estate Investment Trust and Infrastructure Investment Trusts in the form of return on capital, taxable in the hands of unitholders.
This component of the distributions made by REITs and InvITs were so far not taxable in the hands of either unitholders or the Trusts as there was no specific section under the Income Tax Act for taxing returns on capital. The Government half allowed them the leeway in order to address the challenges of financing and investment in infrastructure.
The Government reinforced its commitment on infrastructure creation as the first budget of Amrit Kaal proposes to enhance capital expenditure by 33 per cent to ₹10 lakh crore in FY24, amounting to 3.3 per cent of the country’s GDP
This is the third consecutive year when the government has steeply increased allocation for infrastructure with the Centre’s effective capital expenditure.
Furthermore, to reinforce the criticality of infrastructure in India’s growth, the Government included ‘Infrastructure and Investment‘ as one of its seven priorities, which Finance Minister Nirmala Sitharaman said acts as “Saptarishi guiding through the Amrit Kaal.”