All ABOUT UNION BUDGET INDIA

Haanji,

Union Budget Presentation Ceremony

    Under Article 112 of the Indian Constitution, the annual Union budget is the declaration of the government's estimated receipts and expenditure for that particular year, which is also referred to as the Annual Financial Statement. Actually, there is no such word like the budget is used in the constitution it just the Annual Financial Statement.

    The Union Budget keeps the government's financial statements for the fiscal year from 1st April to 31st March. The Budget presentation depends on the government. The Union Budget is divided into two parts: Revenue and Capital.

    Revenue Budget:- The budget for revenue includes income and expenditure from the Government. Revenue expenses are expenses of the government's day-to-day operation and the various services offered to all of its citizens. Revenue receipts may additionally be classified into tax revenue (income tax, corporate tax, excise duty, etc.) and non-tax revenue (profit, fines, interest, fees, etc.). If revenue spending is higher than revenue collections, it is claimed that the government has income deficits.

    Capital Budget:- The Capital budget covers government income from assets and payments. The government's capital receipts include mainly government loans, foreign governments, and RBI. Capital expenditure is the expenses for machinery production, equipment development, construction, healthcare, education, and so on. If the expenditure of the government exceeds the total revenue, the fiscal deficit is established.

ORIGIN AND HISTORY OF UNION BUDGET:

    The first budget of India was introduced on April 7, 1860, at a time of British colonial rule. James Wilson, India's Finance Minister at the time, was the one who proposed it.

    On 26 November 1947, the first Finance Minister of Independent Indian, Sir R.K. Shanmugham Chetty, presented the first Union Budget of Independent India. It should be noted that the first Union budget was presented during widespread riots caused by the partition of India. This budget was aimed for seven and a half months and then from 1 April 1948, the next budget was to be carried out. This was the first Union budget, which decided to share the same currency with both India and Pakistan until September 1948.

    Sir R.K. Shanmugham Chetty resigned as India's Finance Minister and ultimately passed the responsibility to John Mathai, who submitted subsequent 1949-50 and 1950-51 Union Budgets. The 1949-1950 budget was the first instance in which a United India budget was prepared, including all the Principal States. 

Timeline of Finance Minister presenting Union Budget after Independence

HOW UNION BUDGET IS FORMED? WHAT FACTORS ARE CONSIDERED FOR THE FORMATION OF BUDGET?

    Every year, the Ministry of Finance's Department of Economic Affairs prepares the Union Budget, which is presented by the Finance Minister. It lays out the country's financial strategy for the coming fiscal year. The planning, presentation, and execution of the Union Budget involve many phases.

    The first steps in the budget-making process begin in August-September, about six months before the budget is presented. Budget Circulars, containing basic forms and required guidelines, are sent by the Finance Ministry to respective ministries and departments. These circulars are then issued to field officers, who provide information on their department's financial expenses and receipts for the current and previous fiscal years, as well as their financial criteria for the coming fiscal year.

    Top officials in their departments analyze the data given by ground-level officials. After approval, the data and estimates are submitted to the relevant ministries for further review. Finally, the data and estimates are submitted to the Ministry of Finance. To calculate their viability, the Finance Ministry analyses these forecasts and compares them to the current economic situation and available resources.

    The Finance Ministry assigns revenues to different administrative ministries and implements new public welfare schemes after carefully studying every aspect. After allocating resources to prospective expenses, the Finance Ministry, in collaboration with the Central Board of Direct Taxes and the Central Board of Excise and Customs, prepares a report detailing the expected revenues for the coming fiscal year. The final phase consolidates all of these reports to produce the final Union Budget. Various departments of the Finance Ministry consult public stakeholders (such as farmers and small business owners) during this process to gain more input and plan an effective budget. And then the printing process of the Union Budget starts with the Halwa ceremony.

PRINTING FORMALITIES AND SECURITY MANAGEMENT:

    As Union Budget is a very sensitive document for the country’s development. The documents on the Union budget are treated with great confidentiality since any leakage in official figures can have serious impacts. The documents are so secretly managed that even the Minister of Finance is not allowed to hold a blue sheet. Based on the data and the major numbers in the blue sheet, the Union Budget is developed. Only the Joint Secretary (Budget) will be expected to carry this valuable sheet. 

    In Rashtrapati Bhavan, all major financial papers have been printed until 1950. However, the imminent leak of data left the government with no option but to shift the government-operated press in Minto Road until 1980. The printing of budget documents was done in the basement of North Block, where the Ministry of Finance is located, after 1980.

Central Revenue and Expenditure In Percentage

IMPORTANCE OF UNION BUDGET:

    The overall objective of the Union Budget is to present the government's annual financial record and planning and help the government to grow our country's economy rapidly. It also empowers the government to fulfill its constitutional obligations such as social, equality, and justice for everyone. India also has a parliamentary democracy, in which it is unable to spend, borrow, or tax money arbitrarily. Budgeting and planning are therefore necessary for the        --_ government to work effectively and to improve the country's economic and social framework.  

    The following key objectives emphasize its importance in India for the Union budget:

• As we all know that resources are limited so with limited resources, the government aims to use them wisely to increase income with the help of a union budget.
• To enhance the downtrodden parts of society through poverty reduction and job creation.
• Creating programs for people to meet necessities like food, housing, healthcare, and education.
• Nowadays there is a huge increment in the price of many products so the union budget helps to control the price hike.
• Union budget ensures that the revenue from taxation and subsidies is fairly distributed.
• In order to ensure economic stability in that country, the Union Budget takes measures to manage inflation, deflation, and currency fluctuations.
• The Union budget will make adjustments to the country's taxation system.
• Any country's Union budget is important because it has a wide impact on the economic stability of the country and general life as well.
• There is no world free of economic inequality. The government attempts to close the division bridge between the wealthy and the poor through its budgetary policies.

    The above information was some of the basic about Union Budget. So let's shortly discuss the Union Budget of the year 2021-2022 which was presented on 1st February 2021 by Union Minister of Finance and Corporate Affairs Smt. Nirmala Sitharaman. The budget for this year is crucial because it is being planned to help the economy recover after the COVID-19 pandemic in 2020. This year Union Budget Presentation is different from previous years. i.e The Minister of finance was seen holding a tablet in a red-colored case with a golden national emblem embossed on it. Finance Minister Nirmala Sitharaman replaced the Swadeshi 'bahi-khata' and moved to one tablet with the Union Budget 2021 which was to be presented for the first time paperless. According to the Ministry of Finance, the Finance Minister introduced the "Union Budget Mobile App" for easy access to budget documents by Members of Parliament (MPs) and the general public using the simplest type of digital comfort. The App provides full access to 14 Union budget files, including the Annual Financial Statement (frequently referred to as the Budget), the Demand for Grants (DG), and the Finance Bill as provided by the constitution.

KEY HIGHLIGHTS OF UNION BUDGET 2021-22:

This year the union budget is figured out by considering six pillars to ensure the overall development of the country i.e.

1. Health and Wellbeing 
2. Physical & Financial Capital, and Infrastructure 
3. Inclusive Development for Aspirational India 
4. Reinvigorating Human Capital 
5. Innovation and R&D 
6. Minimum Government and Maximum Governance 

1. Health and Wellbeing:- 

    This time the Union Budget has focused more on Health and Wellbeing. Rs. 2,23,846 crore for health and well-being has been promised in 2021-22 compared to Rs. 94,452 crore in 2020-21 – there is a rise of 137 percent. This Budget Focus on improving three areas: preventive, curative, and well-being 

Steps to improve health and well-being,

• Vaccines:- In the financial year 2021-22, ₹35,000 crores will be spent on the COVID-19 vaccine. If necessary, the government will provide additional funds. Currently, the pneumococcal vaccine is only available in 5 states. Now it will be introduced throughout the world. Which will avoid the deaths of 50,000 child deaths annually.  
• Health Systems:- ₹64,180 crores to be invested in the 'AtmaNirbhar Swastha Bharat Yojana' centrally funded scheme in the coming six years. There will be a formation of Critical care hospital blocks to Strengthening the National Centre for Disease Control. There will be the establishment of integrated public health laboratories in each district.
• Nutrition:- POSHAN Abhiyaan and Supplementary Nutrition Program will be combined and form Mission POSHAN 2.0. In which nutritional quality, distribution, and result will all be improved.                                                                                                As a result, the health budget was raised to 2,23,846 crores. so now there is a 137 % increase over the previous year's budget.
• Universal Coverage of Water Supply (Jal Jeevan Mission Urban ):- The government is planning to provide a universal water supply to 4378 urban bodies to improve health and quality of life by Spending ₹2.87 lakh crores. 
• Swachh Bharat, Swasth Bharat:- The Urban Swachh Bharat 2.0 Mission will be released, with a budget of Rs.1.41 lakh crore distributed over five years. Which will include terms like Fecal sludge management, Management of waste from urban construction, Wastewater treatment.
• Clean Air:- The Finance Ministry proposed a budget of Rs 2217 crores to counter air pollution. Which 42 urban centers will be covered.
• Scrapping Policy:- Vehicles will be tested for fitness in automated fitness centers. After 20 years in the case of personal vehicles and 15 years in the case of commercial vehicles. And there will be regulation of voluntary vehicle scrapping to phase out old and inefficient automobiles.

Health and Wellbeing Expenditure has been increased by 137%

2. Physical and Financial Capital and Infrastructure:-

• Production Linked Incentive scheme (PLI):- Production Linked Incentive Schemes will cost 1.97 lakh crores over the next five years, which begins this fiscal year. As a result, global manufacturing champions will emerge. And this is important for an AatmaNirbhar Bharat and leads to job creation and youth empowerment.
• Textiles:- Mega Investment Textile Parks will be opened as a scheme to build world-class textile infrastructure with connecting capabilities. Over the next three years, 7 textile parks will be built, to develop international export champions.
• Infrastructure:- To provide more momentum to the National Infrastructure Pipeline, three concrete steps must be taken i.e Creating institutional structures, Assets Monetising, Increase the share of capital spending in central and state budget. Establish a professionally operated Development Financial Institution, Will provide, enable & catalyze infra financing. The investment of ₹ 20,000 crores to capitalize on this institution is done by the government. National Monetization Pipeline of potential brownfield infrastructure assets will be launched, which will help to monetize the functioning of public infrastructure assets. Asset Monetisation Dashboard will be provided to track progress and provide visibility to investors. Assets worth 7,000 crores will be transferred to PGCIL. After commissioning, Railways will monetize dedicated freight corridor assets to generate revenue for operations and maintenance. In the next lot, Airports will be monetized for operation & management concessions.
• Roads and Highways Infrastructure:-  Under the Bharat Mala Pariyojna scheme, 11,000 km of NH corridors will be completed. The Ministry of Road Transport and Highways will receive ₹1,18,101 crore funding. & Another 8,500 kilometers of roads will be created by March 2022.  A new plan to improve public bus service has been proposed which will cost ₹18,000 crores approximately. This new move will make it easier for private companies to finance, purchase, run, and maintain over 20,000 buses through creative PPP models.
• Railway Infrastructure:- By December 2023, all broad gauge rail lines will be completely electrified. High-density rail networks and high-use rail routes to be equipped with an indigenous automatic train safety system. As a result, train collisions caused by human error will be eliminated. Massive amount of 1,10,055 crore to be given to the Indian Railways. MetroLite and new Metro Technologies to be implemented in metro rail systems in tier 2 cities and peripheral areas of tier 1 cities.
• Power Infrastructure:- The framework to be set in place to provide customers with options to choose from multiple power distribution companies. The reformed power-distribution scheme is to be launched, on a result-based basis, which has an investment of ₹ 3,05,984 over 5 years. Which will assist distribution companies for infrastructure creation. The Comprehensive National Hydrogen Energy Mission will be launched soon, this will aid in the production of hydrogen from renewable energy sources. 
• Ports, Shipping, Waterways:- Seven port projects worth more than 2,000 crores will be offered in PPP mode by major ports. Which will lead to a model where the private partner manages the port operations. Scheme to promote flagging of merchant ships to be launched in India.
• Petroleum & Natural Gas:- The Ujjwala scheme has supported 8 crore households to date. It will now be extended to cover 1 crore of additional beneficiaries. In the next three years, City Gas Distribution Network will add another 100 districts
• Increasing FDI in Insurance Sector:- The Insurance Act of 1938 will be modified. Increase the maximum amount of foreign direct investment (FDI) allowed in insurance companies from 49 percent to 74 percent. 
• Stressed Asset Resolution:- Asset Reconstruction Company Ltd to be established. It will strengthen and take on current debts under stress. Besides, it will control and dispose of properties to maximize their worth.
• Deposit Insurance:- Bank customers' deposit insurance coverage will be expanded from 1 lakh to 5 lakh. Depositors should be able to access funds under the insurance coverage limits if the provision is simplified.
• Disinvestment and Strategic Sale:- Apart from IDBI, two public sector banks and one general insurance firm will be targeted for strategic disinvestment in 2021-22. This year, LIC will launch its initial public offering (IPO). The Strategic Disinvestment of Public Sector Enterprises Policy has been approved by the government. The receipts from strategic disinvestment are expected to be about ₹ 1.75 lakh crore in 2021-22.
• Company Matters:- The definition of a small business under the Companies Act of 2013 will be updated. Companies with paid-up capital up to a maximum of ₹ 2 crores and turnover up to a maximum of ₹ 20 crores would operate as small companies. Encouraging the creation of One Person Companies (OPCs) to promote start-ups and innovators. Non-Resident Indians (NRIs) would be able to form OPCs in India. A separate administrative structure for cooperatives will be developed to further Ease of Doing Business. 

3. Inclusive Development for Aspirational India:-

• Agriculture:-  Agricultural credit goal increased to 16.5 lakh crore. It will focus on ensuring enhanced credit flow for the livestock, dairy, and fishery sectors. Operation's Scope Greens Scheme will be expanded to include 22 perishable crops in addition to tomatoes, onions, and potatoes. A total of 5,000 crores will be added to the Micro Irrigation Fund. More than 1,000 mandis will be linked to the National Agriculture Market or eNAM. APMCs would have access to an Agricultural Development Fund to help them improve their infrastructure. Union Budget also ensured MSP at a minimum of 1.5 times the cost of yield across all commodities.                                                                                                                                                                                             (To Know More About Agriculture and Farmer Protest).
• Fisheries:- Government is planning to invest in the creation of modern fishing harbors and fish landing centers, both in the sea and on land. Kochi, Chennai, Visakhapatnam, Paradip, and Petuaghat are five major fishing ports that will be established as economic hubs.
• Defense:- A total fund of Rs 4,78,195.62 crore has been allocated to the Ministry of Defense. Except for pensions, it is attached at Rs 3.62 lakh crore from last year's Rs 3.37 lakh crore. The armed forces' modernization fund has increased from Rs 1,13,734 crore last year to Rs 1,35,060 crore for the financial year 2021-22.
• Migrant Workers and Labourers:- Beneficiaries of the One Nation, One Ration Card scheme can demand rations anywhere in the world, with migrant workers benefiting the most. A portal will be launched that will collect relevant information on gig workers, building and construction workers, and others. For all migrant workers, will assist in the development of health, accommodation, ability, food, credit, and insurance schemes.

4. Reinvigorating Human Capital:

• School Education:- By introducing all NEP elements, 15,000 schools will be improved. Will serve as role models for other schools in their communities. In collaboration with NGOs, private schools, and states, 100 new Sainik Schools will be created.
• Higher Education:- The Higher Education Commission of India will be established as an umbrella body with four separate vehicles for standard-setting, accreditation, regulation, and funding. To improve access to higher education in Ladakh, a Central University will be established in Leh.
• Scheduled Castes and Scheduled Tribes Welfare:- For the next six years, until 2025-26, a total of 35,219 crores has been set aside to provide post-matric scholarships to 4 crore Scheduled Caste students. The cost of establishing 750 Eklavya Model Residential Schools in tribal areas has increased from 20 crores to 38 crores per school.
• Skilling:- To improve opportunities for young people, a proposed amendment to the Apprenticeship Act has been proposed. Rs. 3000 crore for the reorganization of the current National Apprenticeship Training Scheme (NATS) for a post-education internship, as well as training of graduates and diploma holders in Engineering. Partnership initiatives with other countries to be pursued.

5. Innovation and R&D:-

• The first unmanned launch is slated for Dec 2021
• As part of the Gaganyaan mission activities, four Indian astronauts are being trained on generic space Flight aspects, in Russia.
• The National Research Foundation, with a budget of Rs. 50,000 crore, aims to improve the country's overall reach ecosystem.
•  Launching a Deep Ocean project of more than Rs. 4,000 crore to cover ocean depths exploration and protect deep biodiversity.
•  PSLV-C51 will be launched by New Space India Limited (NSIL), a PSU under the Department of Space, carrying the Amazonia Satellite from Brazil, as well as a few smaller Indian satellites.

6. Minimum Government, Maximum Governance :

• A National Commission for Allied Healthcare Professionals has also been established to ensure that the 56 allied healthcare professions are regulated transparently and effectively.
• For the same in the nursing sector, the National Nursing and Midwifery Commission Bill was adopted.
• Proposed reconciliation mechanism for the rapid settlement of CPSE contractual disputes.
• Rs. 3,768 crores for the first digital census in Indian history.
• A grant of Rs 300 crore to Goa for the celebrations of the state's diamond jubilee of Portuguese liberation.
• In Assam and West Bengal, using a special scheme, Rs. 1.000 for tea workers and in particular women and their children.

Central Government Expenditure IN Cr.

SOME OF THE MIXED FACTS RELATED TO BUDGET:-

• Relief from filing tax returns for senior citizens over 75 years of age and having an only pension and interest income tax to be deducted by paying bank.
• Rules to be notified for removing hardships faced by NRIs regarding their foreign retirement accounts.
• Rules will be published to minimize the difficulties that NRIs face when it comes to their international retirement accounts.
• Additional deduction of interest, up to Rs. 1.5 lakh, for a loan taken to buy an affordable house extended for loans taken till March 2022 
• The annual receipt waiver limit for small charitable trusts that operate schools and hospitals has been increased from ₹1 crore to ₹5 crores.
• The employer would not be able to deduct the employee's contribution if it is deposited late.
• By reviewing more than 400 old exemptions, a new, distortion-free customs duty system will be implemented on October 1, 2021.
• Some restrictions on parts of chargers and sub-parts of cell phones have been removed, and customs duty on some mobile phone parts has been revised to a 2.5 % from a zero rate.
• Customs duty on long products of non-alloy, alloy, and stainless steel was reduced uniformly to 7.5 percent. Copper scrap duty has been decreased from 5% to 2.5 %.
• Caprolactam, nylon chips, and nylon fiber & yarn have had their basic customs duty (BCD) reduced to 5%.
• Customs duties on gold and silver will be reduced.
• To encourage domestic demand, the duty on solar inverters has been raised from 5% to 20%, and the duty on solar lanterns has been raised from 5% to 15%.
• Steel screws and plastic building materials also increased by 15% duty.
• Cotton's customs duty was raised from zero to 10 % while raw silk and silk yarn's duty was raised from 10 % to 15 %. 

CONCLUSION:

    

    In the end, the Union Budget is a road map for the government's anticipated revenues and expenses for a given year. It is one of Parliament's most important presentations. This year's Budget was mainly focused on Health and well-being, Infrastructure Development, and changes in some tax systems. This time budget also focuses on the Research and Development sector which is a good thing to know. 

    so what’re your thoughts related to the Union Budget comment down below.

Note: The above information is just basic the union budget has more in-depth terms to explore, if you are interested then you can refer to the PIB official website.