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Economic Times | 04 Feb, 2021 | 11.56PM IST
Budget 2021 Updates: IMF welcomes India's focus on growth in Union Budget
The IMF welcomed India's Union Budget for focussing on growth and said fiscal policy can and should play an important role in facilitating a strong and inclusive economic recovery.
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South Central Railway gets Rs 7,222 cr in 2021-22 budgetary allocations for infra works
This Budget mark a clear directional change for the Indian economy and that directional change is not what the government has offered as a sudden response, but it was something that was preoccupying the Indian minds for over 30 years.
- Finance Minister, Nirmala Sitharaman
Highest ever allocation for West Bengal in rail budget; non-availability of land delaying projects: Piyush Goyal
Niti Aayog's next list of companies for disinvestment in a few weeks: Rajiv Kumar
NITI Aayog's list of companies for disinvestment in few weeks
Niti Aayog will prepare the next list of central public sector companies for disinvestment in the next few weeks, its Vice Chairman Rajiv Kumar said on Thursday and expressed hope that the proposed asset reconstruction and management companies to address banks' bad loan woes will do a good job like the UTI.
Our revenue figure is under-stated not overstated. We have taken nominal GDP at 14.4%and revenue growth at 16.7%. So the buoyancy is only 1.16%. We are hopeful we will get more than this. We will definitely be within 6.8% and could be lower also
- Tarun Bajaj, Economic Affairs Secretary
Modi's crony centric budget means- Struggling MSMEs given no low-interest loans, no GST relief. The employers of India's largest workforce betrayed
- Rahul Gandhi
Govt has lost patience to hear criticism, says Manoj Kumar Jha, RJD
Opening the second day of discussion on a motion thanking the President for his address to the joint sitting of Parliament at the start of the Budget Session, Manoj Kumar Jha of the RJD said the government has lost the patience to hear and any criticism is painted as anti-national.
You all make an account of household expenditure by keeping in mind present needs and future responsibilities. But earlier governments made budgets a medium of such announcements that they could not fulfil. Now the country has changed such 'soch' (thought) and approach.
- PM Modi
From decades, the meaning of budget in our country was only restricted to what announcements have been made on whose name. Budget was turned into an account for the vote bank.
- PM Modi
Previous governments drafted Union Budget with eye on vote bank, said PM Modi
Prime Minister Narendra Modi on Thursday targeted previous governments, saying they drafted the Union Budget with an eye on their vote bank and made budgets a medium of announcements they could not fulfil but now the country has changed its approach.
Ropeways, innovative mobility solutions brought under the ambit of Road, Transport and Highways Ministry, says Union Minister Nitin Gadkari
Budget offers incentives for stakeholders
The budget recognises that the multiplier effects of public investment, especially in infrastructure, crowd in private investment and raise medium-term productive capacity and growth potential. Capital expenditure budgeted outlay for FY2022 has, accordingly, been raised by 34.5% over 2020-21.
Contributions to Employees’ Provident Fund (EPF) above Rs 2.5 lakh a year will be kept in a separate basket and taxed in a similar way as fixed deposits, without any double taxation.
- Kamlesh Varshney, joint secretary, tax policy division at the CBDT
Budgets in previous governments were medium of such announcements which could not be fulfilled, said PM Modi
Companies fear more tax burden on transactions
A request by an automobile company to its parent located outside India for shipping back certain spare parts through an internal system, hotel booking made by an Indian CEO in a foreign location or an email exchange about developing a particular software—all these could now attract equalisation levy.
The greatest thing about this Budget to my mind is the reformist zeal which this government has demonstrated that it is willing to take on this criticism and accelerate the pace of growth.
- Niti Aayog CEO Amitabh Kant
The challenge before the Budget makers was not that we go back to pre-Covid levels but we accelerate the pace of growth to 8%-9%. That means we should continue to grow over long period of time by sheer efficiency and while Niti Aayog has already given five different sets of recommendations on disinvestment.
- Niti Aayog CEO Amitabh Kant
Govt mopped up 80% more from fuel cess in 2020-21 than estimated
The government has mopped up nearly 80% more road and infrastructure cess levied on petrol and diesel compared to what it had estimated for 2020-21. According to the budget documents, the receipts on this account increased to nearly Rs 2.3 lakh crore in the revised estimates compared to the nearly Rs 1.3 lakh crore, which was projected in the budget.
Only a few PSUs to remain in strategic sectors, says Amitabh Kant, Niti Aayog CEO
Niti Aayog CEO Amitabh Kant says there will be a few PSUs in strategic sectors once the public sector policy is rolled out and the Budget for 2021-22 has sent out a strong message about government's reformist zeal.
Apart from the vehicle-scrapping policy helping India to tackle its pollution problems, it provides much impetus to the deeply impacted automotive industry by spurring demand. Infrastructure spend had been the biggest casualty in Covid-affected FY2021.
- Gopichand P Hinduja, co-chairman, Hinduja Group
Marketing support to MSMEs get a jolt
This year, the government has drastically reduced the outlay to many marketing based schemes for the MSMEs. The total outlay for Market Promotion Scheme - has been reduced from Rs 74.63 crore to Rs 39.96 crore this year. Under the same category, the outlay for Procurement and Marketing Support Scheme — has been reduced from Rs 54.59 crore to Rs 24.96 crore.
Budgetary allocation for MSMEs
To help the MSMEs face the challenging times, the government has increased outlays for many MSME targeted schemes as well. Noteworthy is the total outlay for Prime Minister Employment Generation Programme (PMEGP) and Other Credit Support Scheme, which has seen a steep hike this time — from Rs 2800 crore to Rs 12499.70 crore.
Tech culture, policy push may speed up investments in Bengaluru’s aerospace sector
A number of private players in the aerospace and defence sector with units in Bengaluru are planning expansion in the coming months, spurred by the increase in the budget spending for modernisation of armed forces and demand from multinational aviation giants.
Divestment is the missed opportunity of FY2021, and for right reasons. GoI now has a strong batting line-up of candidates: the financial markets are flush with liquidity, valuations are high, and risk-taking for emerging market assets is in place, while the rupee is stable.
- Gopichand P Hinduja, co-chairman, Hinduja Group
Health infrastructure has always been India’s Achilles heel, adversely impacting its human development index (HDI). It is unfortunate that it took a pandemic to finally set our priorities right. An outlay of Rs 2,24,000 crore is 224% higher than the Rs 93,000 crore in FY2021.
- Gopichand P Hinduja, co-chairman, Hinduja Group
What traditionally happened was the new (schemes) kept coming and the old also remained. In a modern dynamic economy, one needs to keep changing. One or two new can come, but at the same time, the old ones need to drop off.
- Expenditure secretary TV Somanathan
Securities market code
Tarun Bajaj said the government will soon set up a committee to prepare a consolidated securities market code as announced in the budget. The new fiscal framework is likely to be presented in the monsoon session of Parliament.
The UK moved long ago to a system of a 2% contingency... We had remained for a very long time on an absolute amount and that absolute amount did not get changed with the size of the budget. This year we felt it because of the pandemic. So, basically we are catching up for what was not done… we have fixed it at 1%.
- Expenditure secretary TV Somanathan
If you exclude an exogenous shock such as what happened in 2020-21, I doubt that we’ll have a serious revenue shortfall. The numbers are reasonable, but it can still go wrong, I admit. If we do have to make adjustments, we will not touch the capital and growth-oriented parts of the budget – that would be our approach to the adjustments that are necessary.
- Expenditure secretary TV Somanathan
Implementation challenge
Tarun Bajaj said the biggest challenge of the budget is implementation. “The response has been overwhelming and unnerving. So, we have to deliver,” he said.
Borrowing plans
Tarun Bajaj said the government has been in discussions with the Reserve Bank of India (RBI) on the borrowing plan. The central bank doesn’t anticipate that it will impact yields, but if needed, short-term borrowings can be used to create room for the private sector.
Prudence doesn't mean stinginess or frugality, says TV Somanathan, Expenditure Secretary
There is a large output gap in the economy and in such a situation there is nothing wrong with pressing the fiscal pedal, expenditure secretary TV Somanathan said. The budget numbers are reasonable and if there is need for adjustment, the capital and growth-oriented parts will not be touched, he said.
Gopichand P Hinduja on Budget
The intent of the Narendra Modi government is loud and clear. It has not shied away from spending in the Covid-wracked period when it has been most essential, and the 9.5% fiscal deficit bears testament to that.
Borrowing plan won’t crowd out private sector, said Tarun Bajaj
Tarun Bajaj added that the Centre will soon engage with international credit rating agencies on the budget that was announced on Monday.
