2014 Union budget of India
Appearance
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Submitted | 10 July 2014 |
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Submitted by | Arun Jaitley, Finance Minister |
Party | Bharatiya Janata Party |
Website | www |
2015› |
The 2014 Union Budget of India was presented by Finance Minister, Arun Jaitley on 10 July 2014,11 am.[1] This was the first budget of Narendra Modi led NDA government.[2]
Salient features of the budget
[edit]- ₹70.6 billion (US$850 million) provided for the development of Smart Cities in India
- ₹10 billion (US$120 million) provided for irrigation
- 5 New IITs and IIMs and four new AIIMS in India.
- New airports scheme in tier 1 and 2 cities
- Schemes for development of sports across the country.
Foreign Direct Investment
[edit]- FDI cap in Defense and Insurance sector has been increased to 49% from 26%.
- FDI in real estate for low cost housing
Personal tax and exemption limit
[edit]- No changes in personal income tax slabs. But tax exemption limit has been increased to ₹250,000 (US$3,000) from ₹200,000 (US$2,400) for those below the age of 60. Income tax exemption limit for senior citizens has been raised to ₹300,000 (US$3,600).
- Investment limit under Section 80C has also been increased to ₹150,000 (US$1,800) from the current ₹100,000 (US$1,200).
- Housing loan interest rate deduction limit has been increased to ₹200,000 (US$2,400).
Budget 2014: Highlights of Finance Minister Arun Jaitley’s Budget speech
[edit]- Two years of sub-five per cent growth has led to challenges to the economy
- Green shoots of recovery seen in global economy
- Slow decision making has resulted in loss of opportunity
- We look forward lower level of inflation
- Will usher in policy regime that will usher in higher growth, low inflation
- Aim to achieve 7-8 per cent economic growth rate in next 3-4 years
- Will leave no stone unturned to create a vibrant India
- Budget proposes Plan expenditure of ₹5.75 trillion (US$69 billion) for the current fiscal
- Anti-poverty programmes will be targeted well.
- We need to revive growth particularly in manufacturing sector and infrastructure
- There is urgent need to generate more resources
- Should we allow economy to suffer because of indecisiveness and populism
- Task before us is challenging
- We must continue to be watchful of CAD
- Target of 4.1 per cent fiscal deficit is daunting but accepting it as a challenge [3]
- Finance Minister emphasizes on fiscal prudence, need to generate more resources.
- Iraq crisis having impact on oil prices
- We must address the problem of black money fully
- We must take bold steps to enhance economic activity
- Expenditure Management Commission will be constituted to look at expenditure reforms
- We are for minimum government, maximum governance
- Overall subsidy regime will be reviewed, especially food and oil. Marginalised sections and SC/ST to be protected
- New urea policy will be formulated
- We have no option but to take some bold steps to spurt economy; these are only the first steps and are directional
- This govt will not ordinarily change policies retrospectively which creates a fresh liability
- All future indirect transfers under the retro tax regime will be scrutinised by a high level committee of CBDT before action is taken
- We are committed to providing stable tax regime which is investor friendly
- Govt to set up a high-level Committee to interact with industry to bring about changes in tax laws if required
- FM Proposes to enhance the scope of income tax settlement commission.
- Govt proposes to strengthen authority for advance ruling in tax, set up more benches
- Transfer pricing regulations for residents and non-residents being done
- FDI in Defence sector raised to 49 per cent
- Finance Minister Arun Jaitley takes 5-minute break; Lok Sabha adjourned for 5 minutes
- Financial stability is foundation of rapid recovery
- Our domestic manufacturing is still at nascent stage
- Manufacturing units will be allowed to sell their products through retail and e-commerce
- Budget proposes 49 per cent FDI in insurance through FIPB route.
- Our Banking system needs to be further strengthened. Need to infuse ₹2.4 trillion (US$29 billion) in our banks
- Bank capital to be raised through retail sale of shares; Govt to continue to hold majority in PSU banks
- Govt proposes to provide finance to 500,000 landless farmers through NABARD
- Will examine proposal to give additional autonomy to banks and make them more responsible
- E-visa to be introduced at 9 airports in the country
- Govt proposes to set up 100 Smart Cities in India. Govt to provide ₹70.6 billion (US$850 million) for development of such cities
- Public sector banks need ₹2.4 trillion (US$29 billion) equity to conform with Basel-III norms by 2018
- ₹50 crore (US$6.0 million) set aside for indigenous cattle breed and blue revolution for inland fisheries
- We expect PSUs to invest ₹2,479.41 billion (US$30 billion) this fiscal
- Infrastructure Investment Trust being set up to finance infra projects and reduce burden on banks
- Total sanitation by 2019
- Budget proposes ₹10 billion (US$120 million) for Pradhanmantri Krishi Seechai Yojana to improve irrigation facility
- National multi-scale programme ‘Skill India’ to be introduced to provide training and support for employment
- ₹2 billion (US$24 million) set aside for the Sardar Patel statue project in Gujarat
- Deen Dayal Upadhyaya Gram Jyoti Yojana to be launched to augment power supply in rural areas
- Pension scheme for senior citizens being revived
- Govt committed to providing 24×7 power supply to all homes
- ₹505.48 billion (US$6.1 billion) proposed for SC development
- EPFO will launch a unified account scheme for portability of Provident Fund accounts
- Govt proposes to set up committee to examine how to utilise large funds lying unused in postal schemes
- Govt approves minimum monthly pension of ₹1,000 (US$12) per month under EPS-95 scheme run by EPFO
- Committee will be set up to examine how unused money in postal schemes can be utilised
- Govt announces schemes for disabled persons; to set up 15 new Braille press and revive 10 existing ones
- ₹143.89 billion (US$1.7 billion) provided for Pradhan Mantri Gram Sadak Yojana.
- Govt to launch ‘Beti Bachao, Beti Padhao’ scheme; sets aside ₹1 billion (US$12 million) for it
- Crisis Management Centres for women to be set up at all government hospitals in NCR region
- Govt increases wage ceiling for EPFO schemes to ₹15,000 (US$180) from existing ₹6,500 (US$78) per month
- ₹36 billion (US$430 million) provided for safe drinking water in 20,000 habitations in villages facing problem of impure drinking water
- Budget proposes National Housing Banking programme; sets aside ₹80 billion (US$960 million)
- ₹2.29 trillion (US$27 billion) allocated for Defence budget.
- 4 more AIIMS in Andhra Pradesh, West Bengal, Vidharba and Purvanchal are under consideration; ₹5 billion (US$60 million) provided
- Each state where there is no AIIMS will be added in the coming years
- Govt proposes to add 12 more medical government colleges
- 5 new IIMs and 5 new IITs proposed to be set up
- ‘Kisan’ TV channel to be launched by DD at cost of ₹1 billion (US$12 million): ₹1 billion (US$12 million) for Community radio stations proposed
- FM proposes National Rural Internet and Technology Mission; ₹5 billion (US$60 million) set aside.
- Metro rail services to be launched in Lucknow and Ahmedabad₹1 billion (US$12 million); ₹1 billion (US$12 million) set aside for it.
- Budget proposes to set up agri-infrastructure fund at a cost of ₹1 billion (US$12 million); two more agri-research institutes in Jharkhand and Assam
- FM announces ₹1 billion (US$12 million) for modernisation of madrasas
- Govt sets aside ₹2 billion (US$24 million) for setting up of agriculture university in Andhra Pradesh and Rajasthan, and horticulture university in Haryana, Telangana
- ₹1 billion (US$12 million) provided for providing soil card to every farmer
- Govt committed to achieve 4 per cent farm growth; to use new technologies to boost crop yields
- ₹5 billion (US$60 million) price stabilisation fund to be set up
- Govt sets aside ₹1 billion (US$12 million) for initiating scheme to provide a soil health card and ₹560 million (US$6.7 million) for soil testing labs.
- No change in income tax rate; personal income tax exemption limit raised from ₹200,000 (US$2,400) to ₹250,000 (US$3,000).
- Education cess for all tax payers including corporates will continueRestructuring Food Corporation of India to be taken up on priority
- Budget proposes ₹2 billion (US$24 million) for setting up 2000 producers’ organisations across the country
- Investment limit under 80C raised from ₹100,000 (US$1,200) to ₹150,000 (US$1,800)
- There is need to examine financial architecture of SME sector
- Kakinada port and adjoining area to be developed
- ₹100 billion (US$1.2 billion) venture capital fund to be set up for MSME sector
- Trade facilitation centres will be set up at a cost of ₹500 million (US$6.0 million) to help handloom development
- Definition of MSME to be revised for high capital ceiling
- India has emerged as the largest PPP market in the world
- ₹00 cr provided for 6 more textile clusters in Rae Bareily, Lucknow, Surat, Bhagalpur, Mysore and Tamil Nadu.
- Govt sets aside ₹500 million (US$6.0 million) for Pashmina Production programme in Jammu & Kashmir
- 1,620-km Ganga inland waterway development from Haridwar to Haldia to be completed in 6 years at a cost of ₹42 billion (US$500 million)
- Selective Expressways parallel to industrial corridors to be taken up
- Ultra modern super critical power projects to be set up
- New airports to be developed through PPP mode
- Coal linkages to be rationalised to reduce power cost
- ₹42 billion (US$500 million) set aside for Jal Marg Vikas project on river Ganga connecting Allahabad to Haldia
- ₹5 billion (US$60 million) provided for ultra modern solar power plants in Rajasthan, Tamil Nadu and Ladakh in Jammu and Kashmir.
- Use of piped cooking gas to be promoted on mission mode
- CRT TVs exempted from customs duty to help poor
- Basic custom duty on LCD and LEDs below 19 inch reduced to zero from 10 per cent
- Changes in Mines and Mineral Regulation and Development Act to be introduced; royalty on minerals to be reviewed to enhance revenue for states
- Modern monetary policy framework needed; govt to put in place such framework in close consultation with RBI
- Govt proposes developing 15,000 km additional gas pipeline through PPP mode.
- Clarification on tax treatment of foreign funds to be announced
- Govt agrees in principle on consolidation of PSU banks
- Banks will be permitted to raise long term funds without regulatory hindrances.
- RBI to frame policy for licensing of small banks, differential banks
- Govt to take up pending insurance reforms bill that provides for 49 pc FDI
- Govt to revitalise small saving scheme; special scheme to encourage saving for girl child education and marriage to be introduced
- PPF investment limit increased to ₹150,000 (US$1,800) from current ₹100,000 (US$1,200)
- ₹1 billion (US$12 million) technology development fund proposed in budget
- Govt sets aside ₹22.5 billion (US$270 million) to improve weather infrastructure
- ₹1 billion (US$12 million) allocated for War Memorial and war museum at Princess Park, near India Gate in Delhi
- ₹500 million (US$6.0 million) provided for setting up of a National Police Memorial
- ₹1 billion (US$12 million) allocated for preserving heritage characters of cities like Mathura and Agra
- Govt sets aside ₹1 billion (US$12 million) for inter-linking of rivers
- Govt announces ₹1 billion (US$12 million) for development of Archaeological sites; Gaya to be developed as world class tourist spot
- Integrated Ganga mission to be set up; ₹20.39 billion (US$240 million) provided in Budget
- ₹500 million (US$6.0 million) set aside for modernisation of Ghats in places like Varanasi and Patna
- NRI fund for conservation of river Ganga to be set up
- ₹2 billion (US$24 million) upgrading indoor and outdoor stadium in Jammu and Kashmir – both in Jammu and Kashmir Valley
- Budget proposes to set up sports university in Manipur
- ₹1 billion (US$12 million) set aside for training on sportspersons for the Asiad Games
- ₹5 billion (US$60 million) provided for rehabilitation of displaced Kashmiri migrants
- ₹1 billion (US$12 million) set aside for development of organic farming in north east region
- ₹2 billion (US$24 million) provided for power reforms, ₹5 billion (US$60 million) for water reforms in Delhi
- Govt to provide ₹10 billion (US$120 million) for rail connectivity in north east region
- Govt announces “Arun Prabha” channel for NE region; will be 24×7 channel
- Non-plan expenditure pegged at ₹12,198.92 billion (US$150 billion) for 2014-15, including fertilizer subsidy and defence spending
- Gross tax receipts pegged at ₹13,645.24 billion (US$160 billion); non-tax revenue ₹2,125.05 billion (US$25 billion); capital receipt ₹730 billion (US$8.7 billion) in 2013-14
- Income tax exemption limit for senior citizens raised from ₹250,000 (US$3,000) to ₹300,000 (US$3,600)
- Exemption on payment of income tax on interest paid on loans for self occupied houses raised to ₹200,000 (US$2,400) from ₹150,000 (US$1,800)
- 10-year tax holiday to be extended to companies that start power generation by March 31, 2017
- Investment allowance of 15 per cent for three years will be allowed to manufacturing companies which invest ₹250 million (US$3.0 million) in plant and machinery
- Concensional rate of 15 per cent on dividends to continue
- Govt to review revised Direct Taxes Code taking into account comments from stakeholders
- Direct tax proposals to involve sacrifice of ₹222 billion (US$2.7 billion)
..
Reactions
[edit]- Former Prime Minister of India, Manmohan Singh reacted on budget saying that "Budget lacks road-maps".[4]
- The Communist Party of India (Marxist) accused the budget as "a recipe for further enriching the rich and impoverishing the poor. "[5]
- Former Chief Minister of Delhi, Arvind Kejriwal stated that "it was a directionless budget with no steps to bring down inflation in the country".[6]
- Sharad Yadav reacted on budget saying that "This Budget shows we are standing where we were. It's like distributing toffees".
- Sonia Gandhi said that Arun Jaitley copied the policies of congress government.[7]
- Rajeev Shukla stated that "This budget is intended for corporate sector and rich people. There is nothing in budget for common man"
- Sudheendra Kulkarni: Smart new cities are welcome. But far bigger challenge is to make old cities smarter. Possible only with Good Governance Reforms.[8]
- Sunil Duggal: The Union Budget 2014-15 was going to be a tough balancing act for Finance Minister Mr. Arun Jaitley, given the precarious state that the Economy was in.[9]
- President of FICCI, Sidharth Birla stated that "The FM has set the ground for repair of the economy. There has been a mix of both short-term and long-term measures geared towards boosting confidence of all key constituents."[10]
- President of CII, Ajay S. Shriram stated that "It has covered many aspects of the population and that is big plus. The finance minister has looked at policies from 2-3 year view and this is a positive direction for higher economic growth."[11]
See also
[edit]References
[edit]- ^ "Expectation from union budget 2014-15". Patrika Group. 10 July 2014. Archived from the original on 14 July 2014. Retrieved 10 July 2014.
- ^ "Union Budget 2014: Jaitley hands middle class its big tax break". India Today. 10 July 2014. Retrieved 10 July 2014.
- ^ "FM Maintains FY15 Fisc Deficit Target At 4.1%". Bloomberg TV India.
- ^ "No roadmap in budget : Manmohan". Patrika Group. 10 July 2014. Archived from the original on 14 July 2014. Retrieved 11 July 2014.
- ^ "On Union Budget". Polit Bureau of the Communist Party of India (Marxist). 10 July 2014. Archived from the original on 14 July 2014. Retrieved 11 July 2014.
- ^ "Arvind Kejriwal reacted to the general budget saying that it was a directionless budget". www.arvindkejriwal.co.in. Retrieved 11 July 2014.
- ^ "जेटली ने ज्यादातर कांग्रेस की योजनाओं को कॉपी किया है". Patrika Group. Archived from the original on 14 July 2014. Retrieved 11 July 2014.
- ^ "Twitter / SudheenKulkarni: Smart new cities are welcome". www.twitter.com. Retrieved 11 July 2014.
- ^ "Post Budget Reactions". www.adgully.com. Retrieved 11 July 2014.
- ^ "Budget 2014-15: India Inc reactions". business-standard. 11 July 2014. Retrieved 13 July 2014.
- ^ "Budget 2014 positive, implementation will be ke". Economic times. Times of India. 10 July 2014. Retrieved 11 July 2014.