During her live budget 2023 update speech, Finance Minister Nirmala Sitharaman stated that the focus will remain on broadening the scope of economic growth, boosting key areas such as infrastructure and manufacturing, and creating jobs.
Finance Minister Nirmala Sitharaman presented the Union Budget 2023 in Parliament on Wednesday, at a time when India’s economy is facing challenges from a variety of global factors, including a sharp rise in inflation and a possible slowdown in GDP growth in FY24.
“This is the first budget in Amrit Kaal, and it hopes to build on the foundation laid by the previous budget as well as the blueprint drawn for India at 100,” Sitharaman said. During her budget speech, the finance minister stated that the focus will continue to be on broadening the scope of economic growth by boosting key areas such as infrastructure, manufacturing, and job creation.
Here are some of the highlights from the Finance Minister’s budget speech
1. The Indian economy is on the right track
Finance Minister Nirmala Sitharaman stated that the Indian economy is on the right track and, despite challenges, is on track for a prosperous future. “Our focus on wide-ranging reforms and sound policies helped us perform well in trying times. India’s rising global profile is due to several achievements, including a one-of-a-kind world-class digital public infrastructure, a COVID vaccination drive, and a proactive role in frontier areas.
2. PM Garib Kalyan Anna Yojana’s free food grain scheme
Under the PM Gaarib Kalyan Anna Yojana, the finance minister stated that the government has implemented a scheme to provide free food grains to priority households for the next year. The government will bear the entire expenditure of approximately Rs 2 lakh crore, according to the finance minister.
According to the finance minister, the Union Budget will be focused on seven priorities. They are inclusive development, going the extra mile, infrastructure and investment, unleashing potential, green growth, youth power, and the financial sector.
- Amrit Kaal’s financial situation
The finance minister stated that the Amrit Kaal budget will lay the groundwork for technology-driven growth and a knowledge-based economy. “Our vision for the Amrit Kaal includes a knowledge-based, technology-driven economy with strong public finances and a thriving financial sector. It is necessary to achieve this ‘janbhagidari’ through ‘sab ka saath, sab ka prayers.’ She stated.
- Agriculture receives a significant boost
As expected, the finance minister made several announcements to boost the overall agricultural sector, including providing affordable solutions to farmers’ challenges. She announced an agriculture accelerator fund to “transform” the industry.
The agricultural credit target will be raised to Rs 20 lakh crore, with a focus on animal husbandry, dairy, and fisheries. “We will launch a new sub-scheme with a targeted investment of Rs 6,000 crore to support the activities of fishermen, fish vendors, and MSMEs,” Nirmala Sitharaman said.
- Health Education and Skill Development
According to the finance minister, 157 new nursing colleges will be established alongside the existing 157 medical colleges established since 2014. To encourage collaborative research and innovation, ICMR labs will be made available for research by public and private medical college faculty and private sector R&D teams.
She also announced a new program to promote pharmaceutical research and innovation. In addition, the government will encourage the industry to invest in research and development in priority areas.
According to the finance minister, a National Digital Library for Children and Adolescents will be established to facilitate the availability of quality books across geographies, languages, genres, and levels, as well as device-agnostic accessibility.
- The budget for the PM Awas Yojana has been increased.
The budget for the Pradhan Mantri Awas Yojana, a Government of India initiative to provide affordable housing for the urban poor, has been increased by 66% to over Rs 79,000 crore.
- Capital investment has received a significant boost.
The finance minister stated in her budget speech that investment and job creation remain the government’s top priorities. She stated that the capital is
Finance Minister Nirmala Sitharaman stated during her budget speech that the capital investment outlay will be increased by 33% to Rs 10 lakh crore, or 3.3% of GDP.
She also announced that the provision for state governments to receive interest-free loans for 50 years has been extended for another year. With an increased outlay of Rs. 1.3 lakh crore, this will be done to stimulate infrastructure investment and incentivize complementary policy actions.
- Railway expenditure is estimated to be Rs 2.40 lakh crore.
The finance minister announced that the total expenditure for the Indian Railway budget will be Rs 2.40 lakh crore, which is nine times the total expenditure in 2013–14.
- PAN to be used as a universal identifier
According to the finance minister, for businesses that are required to have a permanent account number, the PAN will be used as a common identifier for all digital systems of specified government agencies.
- Fiscal Deficit Goal for Fiscal Year 24
The fiscal deficit target for FY24 has been reduced to 5.9 percent of GDP, down from 6.4% in FY23. “I reiterate my intention to bring the fiscal deficit below 4.5 percent of GDP by 2025–26,” said the finance minister.
- Customs duty on specific items, such as cigarettes
The finance minister proposed lowering the number of basic customs duty rates on goods other than textiles and agriculture from 21% to 13%. As a result, some basic customs duties, cesses, and surcharges on items such as toys, bicycles, and automobiles will change slightly. The duty on cigarettes has been raised yet again.
“I propose to provide Customs Duty relief on the import of certain parts and inputs, such as camera lenses, as well as to extend the concessional duty on lithium-ion cells for batteries for another year,” the finance minister said.
- Significant changes in the new income tax regime
According to Finance Minister Nirmala Sitharaman, the income tax rebate has been increased to Rs 7 lakh under the new tax regime.
“The new personal income tax regime with six income slabs, beginning at Rs 2.5 lakhs, will be implemented in 2020. I propose that the tax structure in this regime be changed by reducing the number of slabs to 5 and raising the tax exemption limit to Rs 3 lakh, “she stated.
She also proposed making tax slabs more flexible under the new tax regime. “The new tax rates are 0 to Rs 3 lakhs – nil, Rs 3 to 6 lakhs – 5%, Rs 6 to 9 lakhs – 10%, Rs 9 to 12 lakhs – 15%, Rs 12 to 15 lakhs – 20%, and above 15 lakhs – 30%,” said Finance Minister Nirmala Sitharaman.