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Finance Minister Arun Jaitley presented the Union budget 2017-2018

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Union Finance Minister Shri Arun Jaitley presented his fourth Union budget 2017-2018 in Lok Sabha on February 1, 2017. This is the fourth budget by the Narendra Modi government.

What is Budget?

The Union Budget of India is also referred to as the Annual financial statement in the Article 112 of the Constitution of India.

  • It is the annual budget of the Republic of India which is being presented by the Government on the first day of February for 2017-18 so that it could be materialized before the commencement of new financial year in April.
  • Till 2016 it was presented on the last working day of February by the Finance Minister of India in Parliament.
  • The budget is presented by means of the Finance bill and the Appropriation bill and has to be passed by both the Houses before it coming into effect from April 1.
  • The first Union budget of independent India was presented by R. K. Shanmukham Chetty on November 26, 1947.

Union Budget 2017-2018 Q&A PDF Download

Union Budget 2017-2018 Mock Test

Union Budget 2017-18

It is the first budget after major changes in Indian economy like Goods and Services Tax  and Demonetization in 2016.

The Budget for 2017-18 contains three major reforms.

  1. Presented on Februray 1, 2017 instead of usual practice of being presented on last day of February.
  2. Merger of Railway Budget with the General Budget
  3. Abolition of Planned & Non-Planned Expenditure

Agenda of Union Budget 2017-18

The agenda for the Union Budget 2017-18 is TEC India, where T stands for Transform, E stands for Energize and C for Clean.

  • The agenda seeks to transform the quality of governance and life of people;  Energise various sections of society especially the youth and the vulnerable to bring out the best in them and Clean the country from the evils of corruption, black money and non-transparent political funding.

10 Pillars of Budget 2017-18

The Budget 2017-18 is based on 10 distinct pillars to meet the TEC India agenda.

  1. Farmers
  2. Rural PopulationBudget
  3. Youth
  4. Poor and the Underprivileged
  5. Infrastructure
  6. Financial Sector
  7. Digital Economy
  8. Public Service
  9. Prudent Fiscal Management
  10. Tax Administration

Major Highlights of Union Budget of India 2017-18

The total Budget expenditure allocated for 2017-18 is Rs. 21.47 lakh crores.

DEMONETIZATION

Demonetisation move will not have a lasting impact on the economy.It would lead to higher, cleaner and real GDP growth and tax revenues with elimination of corruption, black money, counterfeit currency and terror funding.

  • Potential to generate long term benefits by transfer of resources from the tax evaders to the Government which can be used for the welfare of the poor and the deprived.
  • Increased capacity of Banks to lend at reduced interest rates and a huge shift towards digitisation among all sections of society.

FARMERS

The agriculture sector is expected to grow at 4.1% in the current fiscal with a better monsoon.

Important Allocations

Total Agriculture Credit to Farmers in 2017-18 Rs. 10 lakh crore
Allocation under Fasal Bima Yojana for 2017-18 Rs. 9000 crore
Long Term Irrigation Fund in NABARD created in 2016-17 Rs. 20000 crore
Dedicated Micro Irrigation Fund to be created in NABARD Rs. 5000 crore
Digital transformation of Primary Agriculture Credit Societies (PACS) in the next 3 years by NABARD. Rs. 1900 crore

 

Dairy Processing and Infrastructure Development Fund in NABARD Rs. 8000 crore

NABARD would work to computerize and integrate all the 63,000 functional Primary Agriculture Credit Societies (PACS) with the Core Banking System of District Central Cooperative Banks

  • The budget aims to increase the coverage under Fasal Bima Yojana from 30% of cropped area in 2016-17 to 40% in 2017-18 and 50% in 2018-19.
  • Long Term Irrigation Fund in NABARD created in last year budget has been allotted Rs. 20000 crore for 2017-18 making total allocation of Rs. 40000 crore for the fund.
  • Micro Irrigation Fund will be set up in NABARD to achieve the goal of ‘per drop more crop’.
  • The Diary Processing and Infrastructure Development Fund in NABARD with total corpus of Rs. 8000 over 3 years would start with initial corpus of Rs. 2000 crore.
  • Interest Subvention of 60 days for farmers in respect of their loans from the cooperative credit structure, as announced by Prime Minister Narendra Modi
  • Government to set up new mini labs in Krishi Vigyan Kendras (KVKs) to test soil quality under Soil Health Cards and ensure 100% coverage of all 648 KVKs in the country. Additionally, 1000 mini labs to be set up by qualified local entrepreneurs for which Government will provide credit linked subsidy.
  • Coverage of National Agricultural Market (e-NAM) increased from the current 250 Agriculture Produce Marketing Committees (APMCs) to 585 APMCs. Each APMCs would get maximum assistance of Rs. 75 lakh for establishment of cleaning, grading and packaging facilities.
  • Create model law on contract farming to integrate fruit and vegetable farmers with  agro processing units for better price realisation and reduction of post-harvest losses.

RURAL POPULATION

Important Allocations

Total allocation for rural, agriculture and allied sectors Rs 1,87,223 crore
MNREGA Rs.48,000 crore
Pradhan Mantri Gram Sadak Yojana (PMGSY) Rs.27,000 crores
Pradhan Mantri Awaas Yojana  (Gramin) Rs. 23000 crore
Deendayal Upadhyaya Gram Jyoti Yojana Rs. 4,814 crore
Deendayal Antyodaya Yojana Rs. 4,500 crore

Total allocation for rural, agriculture and allied sectors for 2017-18 is Rs 1,87,223 crore which is 24 percent more than previous year’s allocation.

  • Allocation under MNREGA increased to Rs.48,000 crore in 2017-18 from Rs 38,500 crore in 2016-17. This is highest ever allocation. Women participation in MGNREGA has increased to 55% compared to less than 48% in the past.
  • Allocation under Pradhan Mantri Gram Sadak Yojana (PMGSY)  for 2017-18 is Rs. 19,000 crore by central government. Besides, with the contribution of the state government under PMGSY, a total amount of Rs. 27000 crore will be spent on PMGSY in 2017-18.
  • The pace of construction of PMGSY roads has accelerated to reach 133 km roads per day in 2016-17, as against an average of 73 km during the period 2011-2014.
  • Under Pradhan Mantri Awaas Yojana (Gramin), the allocation increased to Rs. 23,000 crore for 2017-18 compared to Rs. 15000 crore in 2016-17. Government proposes to construct 1 crore houses by 2019 for houseless and kucha house residing people.
  • Additional allocation of Rs. 4,814 crore has been proposed under the Deendayal Upadhyaya Gram Jyoti Yojana in 2017-18. Government aims to achieve 100% village electrification by May 1, 2018
  • Allocations for Deendayal Antyodaya Yojana (National Rural Livelihood Mission) for promotion of skill development and livelihood opportunities for rural area people is Rs. 4,500 in 2017-18. The allotment under Prime Minister’s Employment Generation Programme (PMEGP) and credit support schemes has been increased more than 3 times.
  • .Government will undertake Mission Antyodaya to make 1 crore households and 50000 gram panchayats poverty free by 2019, i.e. the 150th birth anniversary of Gandhiji.  For this a composite index would be developed to monitor the progress.
  • Target of completing 5 lakh farm ponds and 10 lakh compost pits from MGNREGA funds as announced in the 2016-17 Budget to be achieved by March 2017. Finance x.Ministry expects 10 lakh farm ponds would be completed instead of 5 lakh by March 2017. For 2017-18, another 5 lakh farm ponds will be taken up for drought proofing of gram panchayats.
  • Sanitation coverage in villages increased from 42 percent in October 2016 to 60 percent currently.
  • Sub mission under the National Rural Drinking Water Programme (NRDWP) to provide safe drinking water to over 28,000 arsenic and fluoride affected habitations in the next four years.
  • Mason training to be imparted to 5 lakh persons by 2022 with an immediate target of training at least 20,000 persons by 2017-18 to develop new skills among rural people.
  • Human Resource Reforms For Results Programme to be launched during 2017-18 to implement development programme in Panchayati raj institutions.

YOUTH

Pradhan Mantri Kaushal Kendras (PMKK) has been extended to more than 600 districts across the country. It is already promoted in more than 60 districts.

  • 100 India International Skills Centres would be set up across the country to offer advanced training and courses in foreign languages to help youths seeking job outside the country.
  • Skill Acquisition and Knowledge Awareness for Livelihood Promotion programme (SANKALP) to be launched in 2017-18 at a cost of Rs. 4,000 crore to provide market relevant training to 3.5 crore youth.
  • Next phase of Skill Strengthening for Industrial Value Enhancement (STRIVE) to be launched in 2017-18 at a cost of Rs. 2,200 crore.
  • Five Special Tourism Zones anchored on (Special Purpose Vehicle) SPVs would be set up in partnership with the States. Incredible India 2.0 Campaign will be launched across the world.
  • For Higher Education, government would undertake reforms in UGC to give colleges and institutions greater administrative and academic autonomy
  • SWAYAM (Study Webs of Active –Learning for Young Aspiring Minds) platform would be launched with at least 350 online courses and further link it to DTH channels, dedicated to education to enable students to virtually attend the courses taught by the best faculty; access high quality reading resources; participate in discussion forums; take tests and earn academic grades
  • National Testing Agency to be set up as an autonomous organization to conduct all entrance examinations for higher education institutions

THE POOR AND THE UNDERPRIVILEGED

  • Mahila Shakti Kendra to be set up at village level with an allocation of Rs. 500 crores in 14 lakh Integrated Child Development Services (ICDS) Anganwadi Centres.
  • Allocation for Women and Children welfare under various schemes across all Ministries increased from Rs. 1,56,528 crores in 2016-17 to Rs. 1,84,632 crores in 2017-18.
  • Under Maternity Benefit Scheme Rs. 6,000 will be transferred directly to the bank accounts of pregnant women who undergo institutional delivery and vaccinate their children
  • National Housing Bank to refinance individual housing loans of about Rs. 20,000 crore in 2017-18.
  • Action plan made to eliminate Kala-Azar and Filariasis by 2017, Leprosy by 2018, Measles by 2020 and tuberculosis by 2025.
  • Similarly, action plan prepared to reduce Infant Mortality Rate (IMR) from 39 in 2014 to 28 by 2019 and Measles, Mumps, and Rubella (MMR) from 167 in 2011-13 to 100 by 2018-2020.
  • 1.5 lakh Health Sub Centres will be transformed into Health and Wellness Centres.
  • Government to create additional 5,000 Post Graduate seats per annum in Medical colleges.
  • Two new All India Institutes of Medical Sciences to be set up in the States of Jharkhand and Gujarat.
  • Propose to amend the Drugs and Cosmetics Rules to ensure availability of drugs at reasonable prices and promote use of generic medicines
  • Allocation for the welfare schemes of Scheduled Castes increased 35 percent from Rs. 38,833 crores in 2016-17 to Rs. 52,393 crores in 2017-18.
  • Allocation for Scheduled Tribes is Rs. 31,920 crores and for Minority Affairs to Rs. 4,195 crores.
  • Aadhar based Smart Cards to be issued for senior citizens containing their health details with pilot service in 15 districts during 2017-18.
  • LIC to implement scheme providing assured pension with a guaranteed return of 8% per annum for 10 years to senior citizen.

INFRASTRUCTURE

Total Infrastructure Allocation Rs. 3,96,135 crores
Allocation in Transportation Sector including rail, roads, shipping Rs. 2,41,387 crores
Railway Sector Rs. 1,31,000 crores
Allocation for Highway Rs. 64,900 crores

RAILWAYS

The total capital and development expenditure of Railways has been allotted Rs. 1,31,000 crores out of which Rs. 55,000 crores would be funded by the Government.

The 4 major areas that Railways will focus on in 2017-18 includes

  1. Passenger safety
  2. Capital and development works
  3. Cleanliness
  4. Finance and accounting reforms

Rashtriya Rail Sanraksha Kosh to be created with a corpus of Rs. 1 lakh crores over a period of 5 years for safety of Passengers.

  • Unmanned level crossings on Broad Gauge lines to be eliminated by 2020
  • It is proposed to feed about 7,000 stations with solar power in the medium term
  • Railway lines of 3,500 kms to be built in 2017-18, as against 2,800 kms in 2016-17.
  • 500 stations will be made differently-abled friendly with lifts and escalators.
  • Coach Mitra facility to be launched to register all coach related complaints and requirements. Indian Railways coaches to be fitted with bio-toilets by 2019.
  • Railways to offer competitive ticket booking facility. Service charge on booking e-tickets through IRCTC has been withdrawn.

ROAD TRANSPORT

  • The total allocation for highways increased from Rs. 57,976 crores in 2016-17 to Rs. 64,900 crores in 2017-18.
  • 2,000 kms of coastal connectivity roads have been identified for construction and development
  • Total length of roads, including those under PMGSY, built from 2014-15 till the current year is about 1,40,000 kms which is significantly higher than previous three years

TELECOM SECTOR

  • BharatNet Project allocated Rs. 10,000 crores in 2017-18.
  • High speed broadband connectivity on optical fibre to be made available in more than 1,50,000 gram panchayats at low tariff by the end of 2017-18
  • A DigiGaon initiative to be launched to provide tele-medicine, education and skills through digital technology.

ELECTRONIC MANUFACTURING

  • Nearly 250 investment proposals for electronics manufacturing have been received in the last 2 years with total investment of Rs. 1.26 lakh crores.
  • Allocation for incentive schemes like M-SIPS and EDF increased to all time high Rs. 745 crores in 2017-18.
  • Trade Infrastructure for Export Scheme (TIES) to be launched in 2017-18 to promote export infrastructure.

FINANCIAL SECTOR :

Foreign Investment Promotion Board (FIPB) to be abolished in 2017-18

Computer Emergency Response Team for Financial Sector (CERT-Fin) will be established.

  • The shares of Railway PSEs like IRCTC, IRFC and IRCON will be listed in stock exchanges.
  • Rs. 10,000 crore allocated for recapitalization of Banks in 2017-18 in line with the ‘Indradhanush’ roadmap.
  • Allocation under the Pradhan Mantri Mudra Yojana has been doubled in 2017-18 at Rs. 2.44 lakh crore from previous 1.22 lakh crore with priority to Dalits, Tribals, Backward Classes, Minorities and Women.

DIGITAL ECONOMY

Two new schemes would be launched under BHIM App. Referral Bonus Scheme for individuals and a Cashback Scheme for merchants.

  • Mission would be set up to undertake Rs.2,500 crore digital transactions in 2017-18 through UPI, USSD, Aadhar Pay, IMPS and debit cards.
  • Banks to introduce additional 10 lakh new PoS terminals by March 2017 and 20 lakh Aadhar based PoS by September 2017.
  • Government to create Payments Regulatory Board in the Reserve Bank of India replacing the existing Board for Regulation and Supervision of Payment and Settlement Systems.

PUBLIC SERVICE

  • Head Post Offices to function as front offices for rendering passport services.
  • Centralised Defence Travel System developed to enable soldiers and officers to book travel tickets.
  • Tribunals with overlapping functions to be merged
  • A High Level Committee under the Chairmanship of Honourable Prime Minister to be set up to improve the standards of public service and transparent governance
  • Centenary year of Champaran Satyagrah to be commemorated in 2017-18
  • Government of India will support Government of Gujarat to commemorate 100 years of Sabarmati Ashram in 2017.
  • A comprehensive web based interactive Pension Disbursement System for Defence Pensioners will be established.
  • Government proposes to introduce a system of single registration and two tier system of examination.
  • Government to introduce legislation to confiscate the assets of economic offenders

FISCAL MANAGEMENT

  • The total expenditure in Budget for 2017-18 has been allocated Rs. 21.47 lakh crores.
  • Capital expenditure increased by 25.4% compared to the previous year.
  • Total resources being transferred to the States and the Union Territories with Legislatures is Rs. 4.11 lakh crores as against Rs. 3.60 lakh crores in 2016-17.
  • FRBM Committee has recommended 3% fiscal deficit for the next three years
  • The fiscal deficit projected for 2017-18 is 3.2% of GDP and 3% in the following year.
  • The Revenue Deficit of 2.3% in 2016-17 was reduced to 2.1% in the Revised Estimates.
  • The Revenue Deficit is estimated at 1.9% in 2017-18 as against 2.1 percent in 2016-17.
  • Net market borrowing of Government to be limited to Rs. 3.48 lakh crores  in 2017-18 compared to Rs. 4.25 lakh crores in 2016-17

TAX PROPOSAL

Measures for Promoting Affordable Housing and Real Estate Sector

  • The holding period for considering the Capital Gain Tax of immovable property has been increased from 2 years to 3 years.
  • Minimum Alternate Tax (MAT) has been proposed to be carry forwarded for 15 years instead of 10 years.
  • In MSME sector for companies with turnover upto Rs. 50 crore the income tax will be reduced to 25%.
  • Basic customs duty on LNG reduced from 5% to 2.5%.

Promoting Digital Economy

  • For tax payers with annual turnover of less than Rs. 2 crore, the rate of 6% of annual turnover will be used for calculating tax(presumptive income) instead of earlier 8%.
  • Limit of cash donation reduced from Rs. 10,000 to Rs. 2000.
  • No cash transaction above Rs 3 lakh will be permitted.

Transparency in Electoral Funding

A political party can receive a maximum of Rs 2000 in cash per person.

Ease of Doing Business

  • Business entity that will opt for presumptive income scheme the threshold of audit has been increased from Rs 1 Crore to Rs 2 Crore.
  • No TDS deduction on commission payable to individual insurance agents if their income is below taxable limit.

Personal Income-Tax

  • For individuals with income between Rs. 2.5 Lakh and Rs.5 lakh rate of taxation has been reduced from 10% to 5%.
  • For individuals whose annual taxable income is between Rs. 50 lakhs and Rs. 1 crore a surcharge of 10% of tax payable will be levied.
  • Single Page Income Tax Return filing form for taxable income under Rs. 5 lakh
  • Small firms with turnover up to Rs.50 crore will now only need to pay 25% tax instead of 30%.

Union Budget 2017-2018 Q&A PDF Download

Union Budget 2017-2018 Mock Test