Honourable Finance Minister Nirmala Sitharaman presented the Union Budget today, 1st February 2022 at 11am. The excitement could clearly be witnessed in the equity markets with Sensex touching as high as ~59,000pts and Nifty at ~17,500pts. Clearly, the market is happy with the Budget 2022!

The Union Budget 2022 is progressive, pro-growth with realistic and credible numbers focusing on infrastructure spending, developing rural India and economic recovery.

    • India’s FY22 GDP growth expected to be 9.2%
    • Capital expenditure stepped up to Rs 7.5 lakh crore in FY23 vs Rs 5.5 lakh crore in FY22
    • The Budget Estimates in 2022-23 for total expenditure stand at Rs 39.45 lakh crore, while the total receipts other than borrowings amount to Rs 22.84 lakh crore
    • The fiscal deficit is estimated at 6.9% of GDP in FY22 and 6.4% in FY23
    • Despite the ongoing pandemic, GST collections of January 2022 touched an all-time high of ~Rs.1,47,000 crore
    • First Budget to address the issues of mental health – this will definitely go a long way in destigmatizing this cause

Union Budget 2022 was presented in 4 segments,

    • Blueprint of the Economy from India 75 to India 100 – Foundation for India’s next 25 years
    • Activities undertaken/ commenced
    • 4 main priorities of Union Budget 2022
    • Taxation

India 75 to India 100
Vision for [email protected],

    • Transparency of financials and fiscal position
    • Strengthening of health infrastructure
    • Complementing macro-economic growth with micro-economic welfare
    • Encouraging digital economy and FinTech
    • Fostering a technology-enabled development
    • Relying on virtual cycle for private and public sector investments
    • Strengthening the ability of poor to achieve and tap job opportunities

Activities Undertaken/ Commenced

    • Productivity Linked Incentive Scheme in 14 sectors has the potential to create 60 lakh new jobs
    • Transfer of ownership of Air India has been completed
    • The National Bank for Financing Infrastructure and Development and National Asset Reconstruction Company have commenced their activities
    • The IPO of LIC is expected shortly
    • Over 25,000 compliances reduced and 1,486 Union Laws repealed since 2014

4 Priorities of Budget 2022
The Budget introduced the 4 main priorities which it will work on to lay the foundation for [email protected],

    1. PM GatiShakti
    2. Inclusive Development
    3. Productivity Enhancement and Investment, Sunrise Opportunities, Energy Transition and Climate Action
    4. Financing of Investments

1. PM GatiShakti :

    • An approach for economic growth and development
    • Driven by 7 engines namely, Roads, Railways, Airports, Waterways, Ports, Mass Transport and Logistics Infrastructure to enhance Multimodal communication
    • The crux of the PM GatiShakti National Master Plan will be world-class modern infrastructure and infrastructural development
    • To facilitate better movement of people and goods, The National Highways Network will be expanded by 25,000 kms in FY23
    • 400 new gen Vande Bharat trains to be manufactured in the next 3 years
    • Railways will develop new products and logistic services for small farmers and MSMEs
    • ‘One Station- One Product’ concept will be promoted to help local businesses and supply chains built on a hub and spoke model
    • 2,000 km of network to be brought under a new scheme, Kavach – for safety and capacity augmentation
    • National Ropeways Development Program will be taken up in PPP Mode
    • 4 multi-modal national parks contracts will be awarded in FY23
    • 100 new cargo terminals to be developed over the next 3 years

2. Inclusive Development :

    • Agriculture & Food Processing
    1. Rs 2.37 lakh crores of direct payment of MSP has been credited to the farmers accounts
    2. Chemical free natural farming will be promoted
    3. 60,000 Cr allocated to cover 3.8 Cr households for tap water
    4. Announcement of Ken Bitwa River Linking Project to benefit 9.1 lakh hectare farm land
    5. 2023 marked as the International Year of Millets wherein support for post value millet production will be provided and millet will be branded nationally and internationally
    6. To reduce dependence on import of oil-seeds, a comprehensive scheme will be implemented to increase the domestic production of oil-seeds
    7. For delivery of digital and hi-tech services to farmers, a scheme in PPP mode will be launched
    8. Will promote startups to develop and manufacture ‘Kisan Drones’ to aid farmers
    9. NABARD will finance agri-tech startups
    1. The Emergency Credit Line Guarantee Scheme (ECLGS) has provided credit to more than 130 lakh MSMEs to mitigate the adverse effect of the pandemic and is further extended till March 2023
    2. Rs 6,000 cr programme of Raising and Accelerating MSME Performance (RAMP) will be rolled out over the next 5 years
    3. CGTMSE will be revamped with additional fund infusion which will create additional credit to MSME of Rs.2 lakh crore
    1. Skilling programs with industry will be rolled out to promote sustainability and employability.
    2. Digital Ecosystem for Skilling and Livelihood will be launched to empower skill and reskill through online training to find relevant jobs
    1. ‘One Class- One TV channel’ program of PM e-Vidya will be expanded to impart 200 TV channels to provide supplementary education in regional languages from classes 1 to 12
    2. Digital university will be established for world-class universal education and personalised learning opportunity at every doorstep
    3. High quality e-content in all spoken languages will be developed for delivery via internet, mobile phones, TV and radio through digital teachers
    1. Open platform for National Digital Health Ecosystem for universal access to healthcare facilities will be rolled out
    2. A National Tele-Mental Health Program with 23 tele-mental health centres will be launched with IIIT, Bangalore providing the tech support
    1. PM AWAS Yojana – By 2023, ~80 lakh houses will have been completed for both rural and urban, Rs. 48,000 cr has been allocated for this purpose
    2. Central Government will work with financial regulators to expand access to capital and reduce cost of intermediaries
    1. Proposal to set up 75 Digital Banking Units in 75 districts across India by scheduled commercial banks
    2. 100% of post offices to be brought under core banking system to give digital push
    3. PM-DevINR to fund infra and social development in the North-East
    4. IBC resolution process to be amended to allow and facilitate cross border insolvency solutions

3. Productivity Enhancement and Investment & Climate Action

    • Ease of Doing Business 2.0 and Ease of Living will be launched
    • States will be given Unique Land Parcel ID Number to facilitate IT-based management of records
    • E-passports with embedded chips will be rolled out in FY23 to enhance convenience of overseas travel
    • Roll out of 5G mobile services by private telecom provider will be facilitated in 2022-23
    • Contracts for laying optical fibre in all
      villages will be awarded under the Bharatnet
      project through PPP in FY23. Completion is expected in 2025
    • Battery swapping policy as an alternative to charging stations will be introduced to boost usage EV’s
    • To facilitate domestic manufacturing of 280 GW of installed solar capacity by 2030, an additional allocation of Rs 19,500 cr for PLI for manufacture of high efficiency modules
    • 68% of defence capex to be kept for domestic procurement
    • Defence budget increased; Defence R&D will be opened up for industry, startups and academia

4. Financing of Investments

    • RBI will issue Digital Rupee using blockchain technology starting 2022-23
    • An International Arbitration Centre will be set up in the GIFT city
    • Rs 1 lakh crores will be allocated to States for financial assistance in FY23
    • State Govts to get long term interest free loans outside of normal borrowings
    • backed NIIF and SIDBI’s Fund of Funds to develop skill capital, blended finance for sunrise sectors like deep-tech, climate action, agri-tech etc and govt. share will be limited to 20%
    • Infrastructure status for data centres and energy storage systems
    • Sovereign Green Bonds to be issued


    • Transfer of any virtual digital asset (incl. cryptocurrencies) to be taxed at 30% (no deduction of expenses and set off available except of cost of acquisition)
    • TDS at 1% to be deducted on transaction value of transferring virtual digital assets
    • Updated return can be filed within 2 years of assessment year to declare/rectify income that might have been missed/ wrongly submitted earlier
    • Tax relief will be provided to persons with disability
    • Extending period of incorporation of eligible startups for tax incentives
    • Alternate minimum tax for co-operative societies down to 15% from 18.5%
    • Cap on surcharge on any LTCG at 15%
    • Tax Deduction Limit for state government employees to NPS raised from 10% to 14%
    • Health and Education Cess and Surcharge shall not be allowed as business expenditure
    • Customs duty on critical chemicals like methanol and acetic acid reduced; 5% to 2.5% and 7.5% to 5% respectively
    • Custom Duty on unpolished diamonds reduced to 5% to give a boost to gems and jewellery
    • On import of imitation jewellery, Rs.400/kg as duty
    • Unblended fuel will attract an additional differential excise duty of Rs.2/litre from 1st Oct,22
    • Duty concession on electronics – wearables, hearables, electronic smart meters, camera lens, mobile phone chargers etc

Although there was no change in income tax slab rate for individuals and others in view of rising inflation, the vision for a digital and progressive Indian economy was an overall positive in the Union Budget 2022.



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