Tracking the latest updates as Finance Minister Arun Jaitley presents the Modi government’s last Union Budget before the next general elections.
1:00 pm: No big bang budget from Modi sarkar
ThePrint’s YP Rajesh on the budget:
“Lots for rural and farm sector. Not good for investors and stock markets. Some slippage on fiscal front. Not much joy for salaried class either. Certainly not a big bang last budget by Modi Sarkar.”
What do you think?
12:45 pm: Jaitley bites bullet on Long Term Capital Gains tax
Jaitley bites the bullet on long term capital gains tax, says ThePrint’s YP Rajesh.
Long term capital gains exceeding Rs 1 lakh will be taxed at 10 per cent as opposed to nil now. Stock exchanges that were flat so far, dip after this announcement. But this is a good revenue mopping step for the government, says Rajesh.
Jaitley says reforms introduced by government and incentives given so far have caused equity markets to become buoyant. Return on investment in equity markets have become very attractive even without tax exemption. So there is a strong case for Long Term Capital Gains. But since we need a vibrant stock market to push growth the proposal is for a modest tax, Jaitley says.
12:35 pm: No change in Income Tax exemptions
No new changes in the Income Tax exemptions. There were a few boos from some MPs. Reason: We’ve given many concessions in last 3 years, says Jaitley.
Quite a gamble in election year. Standard deduction of Rs 40,000 instead of medical and transport reimbursements for salaried class. That’s a consolation though, says ThePrint’s YP Rajesh though it means a gain of just over Rs 15,000 per year.
But there were a lot of sops for Medium and Small Enterprises.
The Finance Minister says they will pay reduced corporate tax 25 per cent to companies of reported turnover Rs 250 cr in the financial year 2016-17. Jaitley says this will benefit the entire MSME which amount to 95 percent of companies filing tax returns.
The estimated revenue forgone will be 7,000 crore during 2018-19.
Significant concessions in #UnionBudget2018 to MSMEs. To be noted- RSS affiliate Swadeshi Jagran Manch had flagged this as key concern.
— Anubhuti Vishnoi (@anubhutivishnoi) February 1, 2018
12:33 pm: Why the Sela pass tunnel at Tawang matters
In his budget speech, Finance Minister shared that allocations are being made this year to construct a new tunnel at the Sela pass – a critical project that will cut down travel time to Tawang by over an hour, besides giving all weather access for troops to the China border in the disputed region.
Jaitley spoke of the tunnel being a boost for tourism in the region but the big beneficiary of the tunnel would be the army, which is deployed heavily in Tawang – one of the most contentious pieces of land between India and China.
ThePrint’s Manu Pubby says Sela also has special significance for India, given how it brought into focus defences in the 1962 after the Army had to abandon it while retreating from Chinese forces. The situation now is different, with Indian forces heavily deployed along the border.
The Border Roads Organisation (BRO) had announced the tunnel construction projects at Sela in July 2017, sharing details of two tunnels that will pass through the 4170 meter high pass in Arunachal Pradesh.
12:32 pm: Big numbers on direct tax collection front
Jaitley says it grew 12.6 per cent last fiscal and until 15 January this year it grew 18.7 per cent. There is a huge increase in number of returns filed, Jaitley says.
Acccording to ThePrint’s YP Rajesh, then comes the punch line: Demonetisation was received by honest tax payers as “imaandari ka uthsav” or festival of honesty. Really, sir?
12:30 pm : A raise for the President, Vice President and MPs
The salary of the President, Vice President and Governors has been revised. It is now Rs 5 lakh for the President, Rs 4 lakh for the Vice President and 3.5 lakh for Governors. They’re not there in Parliament but they’re applauding wherever they are.
The NDA government making sure in its last budget of this term that constitutional functionaries are happy, says ThePrint’s YP Rajesh.
MPs haven’t been ignored. Now their salaries will be revised every 5 years indexed to inflation. Hope Mr Jaitley won’t disappoint us middle classes!
If MPs' allowances are auto linked to inflation, how about threshold limits for common man? How about auto linking exemption limits for allowances for salaried class?@bcasglobal #Budget2018withBCAS #TaxFunwithBCAS
— Ameet Patel (@patelameet) February 1, 2018
Revised emoluments for MPs in #Budget2018. The demand was made many a times by MPs across parties. MPs look happy.
— pragya kaushika (@pragyakaushika) February 1, 2018
If Members of Parliament can link their own salaries to inflation, why not do the same for farmers?#KisanSeDhokha
— Yogendra Yadav (@_YogendraYadav) February 1, 2018
12:25 pm: More disinvestment
Here come the big numbers. Arun Jaitley sets Rs 80,000 crore target for disinvestment, compared to Rs 72,500 crore.
The Finance Minister says Rs 5 lakh crore additional lending will be possible after recapitalisation of public sector banks. Now over to the private sector, to borrow, invest and grow, says ThePrint’s YP Rajesh.
Meanwhile Devendra Fadnavis can’t stop tweeting his thanks:
Celebrate Mumbai !
₹40,000 crore for enhancing transportation in #Mumbai with expansion of suburban railway system & new airports.
This is big boost to infrastructure sector & economy !
Thank You Hon @narendramodi ji, @arunjaitley ji & @PiyushGoyal ji! #NewIndiaBudget
— Devendra Fadnavis (@Dev_Fadnavis) February 1, 2018
12:22 pm: A boost for bamboo
The Modi govt will also restructure national bamboo mission with an outlay of Rs 1,290 crore, says ThePrint’s Jayanta Kalita.
India is only second to China in bamboo reserves, accounting for 20 per cent of the global production. Given that 66 per cent of India’s bamboo stock comes from the northeast, the allocation in the law will provide a major boost to small farmers and handicraft entrepreneurs of the bamboo-rich region.
12:20 pm: What’s in Budget 2018 for India’s defence sector
ThePrint’s Manu Pubby says the Finance Minister has announced a number of initiatives to develop defence industry and give adequate resources.
Two defence industrial developmental corridors to come up. Will bring up a new policy for domestic production by public, private sector and MSMEs
We do not consider them as legal tender, says Jaitley. But he had very high praise for Blockchain.
Will this give more teeth to law enforcement agencies to crack down on all the suspect, Indian versions of Bitcoin?
The Finance Minister has also talked of taking broadband (or what we call broadband in India) to villages.
Not a bad idea but can we also think of moving higher in overall speeds in the country, considering tiny Sri Lanka next door ranks higher than India when it comes to average net speeds, asks ThePrint’s YP Rajesh.
12:10 pm: Railway budget gone in 10 minutes
Jaitley wraps up what used to be Railway budget in less than 10 minutes, ThePrint’s YP Rajesh says.
He thinks its a good show. And to think we used to spend an entire day on railway budget and reams and reams of newsprint, he says.
The highlights: Capital expenditure pegged at Rs 1.48 lakh crore, large part of it for increasing capacity.
Focus will be on making entire network profitable, increasing electrification, pushing eastern and western dedicated freight corridor, a safety first policy to eliminate accidents, maintenance of tracks, increasing use of technology, a fog-safe train protection and warning system, eliminating unmanned crossings, redeveloping railway stations, adding escalators, WiFi, CCTVs, producing state-of-the-art coaches, augment Mumbai locals and of course, the bullet train project.
12:02 pm: Bigger push for Aadhaar-based subsidy transfer
The government makes a strong pitch for Aadhaar-based Direct Benefit Transfer, Jaitley says it has helped improve delivery.
Ironically, DBT was brought in by Cong with theme ‘Aapka Paisa Aapke Haath’ with much fanfare, but the party failed to own the scheme politically or give it adequate push, says ThePrint’s Ruhi Tewari.
12:00 pm What’s in it for women so far
The Modi government has talked a big game when it comes to women’s empowerment, and Finance Minister Arun Jaitley’s Budget Speech 2018-19 was in line with this agenda, says ThePrint’s Sanya Dhingra.
The three key takeaways for women from his speech so far include:
- an increase in the Mudra Yojana loans, whose 76 percent beneficiaries are women
- increase of Ujjwala Yojana beneficiaries from 5 crore to 8 crores
- easing payments under schemes for women workers administered by the Employees’ Provident Fund Organisation (EPFO) from 12 per cent to 8 per cent.
The Economic Survey had noted that women’s employment has gone down by 12 percent since 2006-07 to 2016-17 – a reduced rate of contribution for women workers would act as an incentive to hire women workers.
11:55 am: Boost for infrastructure, tourist sites to be made ‘iconic’
India needs Rs 50 lakh crore investment to boost infrastructure, Jaitley says, and adds that PM Modi personally reviews progress in the sector.
We need to boost our roads, railways, airports, ports, inland waterways to increase GDP growth, he says.
There’s also a new tunnel to improve transport to Tawang. Here’s why it matters apart from tourism:
Govt to construct a new tunnel at Sela pass to promote tourism and improve connectivity for border defences. Will reduce road distance and travel time to the China border at Tawang.
— Manu Pubby (@manupubby) February 1, 2018
There’s a boost for tourism in the naton with a proposal to make 10 prominent tourist sites into ‘iconic’ tourist sites. Not clear yet which the are. ThePrint’s YP Rajesh wonders if the Taj Mahal will make it to the list.
11:50 am: Finance Minister says Clean Ganga is going good, we found otherwise
Cleaning Ganga is doing well claims Jaitley, although reports from ground don’t seem to match that. 187 projects sanctioned, 47 completed, he says.
ThePrint team found little change on a recent reporting trip.
11:45 am: New scheme for public healthcare
The Finance Minister has announced a flagship national health protection scheme for 10 crore families with Rs 50 cr allocated for it, a scheme ThePrint predicted.
The scheme will cover a hospital bill up to Rs 5 lakh per family per year.
The Finance Minister says this will be largest government funded health programme ever.
This scheme will be expanded after this pilot project to achieve universal basic health, Jaitley says.
It’s another big social welfare scheme but not a big surprise in election year, says ThePrint’s YP Rajesh.
11:40 am: FM clears new funding model for IITs, IIMs
ThePrint’s Anubhuti Vishnoi says that the Finance Minister has announced a major reform for higher education sector in India.
Union Budget 2018 has announced a new model for funding infrastructure in the central government-funded higher educational institutions, calling on IITs, NITs and IIMs to pitch in with 25 per cent of total funds needed, she says.
11:38 am: Focus on rural employment
The Finance Minister says the government will allocate Rs 5700 core for the National Rural Livelihoods Mission (NRLM).
The Finance Minister says total allocation to improve rural livelihood will be Rs 14.3 lakh crore.
ThePrint’s Ruhi Tewari had reported the thrust of Rural Development ministry in 2018-19 will be on enhancing livelihoods.
11:35 am: Ahead of 2019 polls, more gas connections for poor families
Here come the freebies, says ThePrint’s YP Rajesh as the Finance Minister announces a bump in the government’s Ujjwala scheme for gas connections.
The Finance Minister has raised the Ujjwala Yojana target, and will now give free gas connections to 8 crore poor households.
ThePrint’s Ruhi Tewari points out that Ujjwala scheme worked greatly in BJP’s favour electorally among rural electorate in state elections like UP.
11: 30 am: Taking on pollution by subsidising machinery for stubble
The Finance Minister announces a special scheme to subsidise machinery for Haryana, Punjab, and Uttar Pradesh farmers to address the problem of stubble burning that leads to severe air pollution in National Capital Region.
Need to see if this is a substantial allocation or just lip service, says ThePrint’s YP Rajesh.
11:25 am : Operation Green to keep potato and onion prices in check
Special attention this year for onions and potatoes to ensure aloo-pyaaz does not ruin the run-up to the 2019 elections, says ThePrint’s YP Rajesh.
The government is going to launch Rs 500 cr ‘Operation Green’ like ‘Operation Flood’ to ensure stability of supply and prices of these two staples.
11:20 am: Lots of schemes in agricultural sector
The Prime Minister has been applauding as Jaitley says farm production is at a record high, says ThePrint’s YP Rajesh.
Finance Minister also says this government considers agriculture as an enterprise and he wants farmers to produce more from same land parcel at lesser cost and realise higher price.
The goverment is also announcing sops in the backdrop of discontent. Jaitley says there will be an emphasis on generating higher income for farmers; and the Minimum Support Price will be one & a half times cost of produce, says ThePrint’s Ruhi Tewari.
The government will focus on ‘ease of living’ of the poor and middle class, says FM Jaitley in the last full budget, which will set the election pitch for BJP ahead of 2019.
11:15 am : An Aam Aadmi Budget?
The Print’s YP Rajesh notes that the Finance Minister said the government will move from Ease of Doing Business to ‘Ease of Living’ for poor and middle classes.
It’s a clear message to the aam aadmi in the last budget of the Modi government, he says.
ThePrint’s Anjali Shukla has picked these nuggets from what the Finance Minister said:
- GDP for the second half of the year has been forecast at 7.2-7.5 per cent.
- Exports are expected to grow at 15 percent for the fiscal.
- Services growing at 8 percent.
- Total growth is estimated at over 8 per cent for next year.
11:04: FM starts presenting Budget
Arun Jaitley has started by listing the promises that the government had made before coming to power.
He said that the reforms undertaken by the Modi government has made India one of the fastest growing economies in the world.
“There is a premium on honesty,” says Arun Jaitely before talking about GST, demonetisation and other structural reforms introduced by this government.
ThePrint’s YP Rajesh says:
Arun Jaitley has started his budget speech by listing out what he says are the big gains in the four years of the NDA government. He has listed demonetisation and recapitalisation of banks as major steps and says that it has put the economy on course to achieve growth of over 8 per cent.
10:45 am: The Modi government shouldn’t forget business
The business community will be closely watching this year’s budget given what they had promised before it came to power. And all they’re looking for is an outline for reforms:
It has taken a few years for reality to match expectations, in terms of what the Budget can accomplish. With a national election looming, the scope for tectonic reforms in the Budget may be limited — except if they pertain to rural voters. But the Budget speech could be the star of the show if Jaitley can outline specific reforms the government wants to initiate, as he did in his earlier Budgets.
10:40 am: What to watch out for in the Budget
Sources have said that social spending is going to jump in the upcoming budget:
Health, education and agriculture are areas that are expected to get special attention. One major initiative is expected to be a national scheme to extend medical insurance worth Rs 5 lakh each to over 20 crore people, sources told ThePrint.
10:30 am: What the RSS and affiliated bodies are looking for
The RSS-affiliated Swadeshi Jagran Manch wants the Modi government to do a course correction in this year’s Budget.
Here’s what ThePrint’s Anubhuti Vishnoi reported:
The RSS’s economic wing, Swadeshi Jagran Manch (SJM), has recommended a ‘course correction’ to incentivise smaller and new sectors that have greater potential of generating jobs.
10:15 am: Should the Modi govt give in to populism?
Columnist Sandip Ghose wrote for ThePrint that the Modi government should hold its nerve and not give in to populism in this Budget.
Finally, as Arun Jaitley gets up to present the Budget Thursday – do we expect fireworks and any big bang? Banking on the mountain of political capital with which it came to power, so far the Modi government has not displayed any signs of diffidence either in its domestic or foreign policies. It has acted with the utmost confidence of coming back for a second innings.
10:00 am: Arun Jaitley arrives in Parliament
The Finance Minister is now in Parliament with the red suitcase that contains the Union Budget.
— ANI (@ANI) February 1, 2018