Nirmala Sitharaman’s Budget 2021 Speech: Full Text

Finance Minister Nirmala Sithraman presented the Budget 2021 in Parliament.

Finance Minister Nirmala Sithraman presented the Budget 2021 in Parliament. Ms Sitharaman said the Budget was prepared in circumstances -like never before- and that the government was fully prepared to back and facilitate a reset of the economy. According to her, the total impact of Atmanirbhar Bharat and Covid relief measures was Rs. 27.1 lakh crore, which amounts to 13 per cent of the GDP.

Here is the full text of Finance Minister Nirmala Sitharaman’s Budget speech:

                                  CONTENTS                                      PART-A                                                     Page No.Introduction                                              1Aspirational India                                        6      Agriculture, Irrigation & Rural Development      Wellness, Water & Sanitation      Education & SkillsEconomic Development                                      12      Industry, Commerce & Investment      Infrastructure      New EconomyCaring Society                                            19      Women, Child & Social Welfare      Culture & Tourism      Environment & Climate ChangeGovernance                                                23Financial Sector                                          25      Financial Markets      Infrastructure Financing      DisinvestmentFiscal Management                                         29                                         (ii)                                       PART BDirect                                                                             32        Personal Income Tax and simplification of taxation        Dividend Distribution Tax        Concessional tax rate for Electricity generation companies        Tax concession for foreign investments        Start-ups        Concessional tax rate for Co-operatives        Medium, Small and Micro Enterprises (MSME        Affordable housing        Concession to real estate transactions        Charity institutions        Faceless appeals        No Dispute but Trust Scheme – ‘Vivad Se Vishwas'Scheme        Losses of merged banks        Taxpayer's Charter        Instant PAN through AadhaarIndirect Tax                                                                       41AnnexuresAnnexures to Part A of the Speech                                                 44        Budget Outlay for Major Sectors        Major Scheme Allocation        Transfer of Resources to States and Union territories with Legislature        Allocation for Major Ministries / Departments        Statement of Extra Budgetary and Other ResourcesAnnexures to Part B of the Speech                                                 50         Direct Tax         Indirect Tax                            Budget 2020-2021                                 Speech of                          Nirmala Sitharaman                           Minister of Finance                             February 1, 2020Hon'ble Speaker,       I rise to present the Budget for the year 2020-2021.Introduction       In May 2019, Prime Minister Modi received a massive mandate toform the government again. With renewed vigour, under his leadership, wecommit ourselves to serve the people of India, with all humility anddedication.2.      People of India have unequivocally given their jan-aadesh for notjust political stability and also reposed faith in our economic policies. This isthe Budget to boost their incomes and enhance their purchasing power.Only through higher growth we can achieve that and have our youthgainfully and meaningfully employed. Let our businesses be innovative,healthy and solvent with use of technology.3.     For today's youth born at the turn of the century, for every memberof Scheduled Castes and Scheduled Tribes who seeks a better life, for everywoman wishing to stand up and get counted, for every individual from theminority sections of our society – this Budget aims to have your aspirationsand hopes addressed.4.     We wish to open up vistas for a vibrant and dynamic economy with agentle breeze of new technology. This vibrant India shall be a caring societywhich shall attend to its weak, the old and the vulnerable among its citizens.                                      25.     During 2014-19, our government brought in a paradigm shift ingovernance. This shift was characterised by a twin focus: fundamentalstructural reform and inclusive growth.6.     Fundamentals of the economy are strong and that has ensuredmacroeconomic stability. Inflation has been well contained. Banks saw athorough cleaning up of accumulated loans of the past decade and thenthey were recapitalized. Companies were provided an exit through the IBC.Several steps on the formalisation of the economy were taken up.7.     Of the structural reforms, the Goods and Services Tax (GST) hasbeen the most historic in our country. Its chief architect is not with ustoday. I pay homage to the visionary leader late Shri Arun Jaitley ji. At thetime of roll out of GST, he had said and I quote:“It will be an India where the Centre and States will work harmoniouslytowards the common goal of shared prosperity. The unanimity of theConstitutional amendment and the consensus of the GST Council highlightsthat India can rise above narrow politics for the nation's interest. With theGST, neither the state nor the Centre loses its sovereignty. In contrast, theywill pool their sovereignty on decisions on indirect taxes.”8.      True to this vision for the historic structural reform, the Goods andServices Tax has been gradually maturing into a tax that has integrated thecountry economically. It has consolidated numerous taxes and cesses to onetax and facilitated formalization of economy. It has resulted in the efficiencygains in logistic and transport sectors. The turnaround time for trucks haswitnessed a substantial reduction to the tune of 20% due to abolition ofcheck posts in GST. The dreaded Inspector-Raj has also vanished.9.     It has also led to significant benefits to MSME by way of enhancedthreshold and composition limits. The effective tax incidence on almostevery commodity came down substantially.             Through several ratereductions, an annual benefit of ` one lakh crore has been extended toconsumers. It amounts to 10% reduction in overall tax incidence. Anaverage household now saves about 4% on its monthly spends on accountof reduced GST rates.10.     During this phase of maturing, GST did face certain challenges. Thiswas natural as transition was daunting. GST Council has been proactive inresolving issues during transition. In the last two years we have addedmore than 60 lakh new taxpayers, a total of about 40 crore returns were                                      3filed, 800 crore invoices were uploaded, and 105 crore e-way bills weregenerated. There has been extensive engagement with stakeholders. Asimplified new return system is being introduced from April 1, 2020.11.      A former Prime Minister had once voiced a concern that the fruits ofthe welfare schemes were not reaching the intended citizens – the commonand deserving citizen was only receiving 15 paisa of every rupee sent forhim. Guided by “Sabka Saath, Sabka Vikas, Sabka Vishwas”, our governmentand our Prime Minister added manifold speed and scaled up theimplementation of schemes and programmes that directly benefitted thepoor and the disadvantaged. I wish to list out only a few as examples: (a)welfare schemes with Direct Benefit Transfer (DBT) embedded in them; (b)sanitation and water as provision of basic needs and as a measure ofpreventive healthcare; (c) healthcare, through Ayushman Bharat; (d) cleanenergy through Ujjwala and solar power; (e) financial inclusion, creditsupport, insurance protection to vulnerable sections and pension scheme;(f) digital penetration with broadband and UPI; (g) Affordable Housing for allthrough PMAY.      The milestones achieved are unprecedented, globally recognisedand benchmarked against international indices.12.     This strategy, changed the established order of a few individualscornering most of the benefits and was appreciated by the people. This hadimmensely positive outcomes. We have moved on from a growth rate ofjust over 4% in 1950s to 6% in 1980s and1990s. However, during 2014-19we clocked growth of 7.4% on average with inflation, averaging around4.5%. It is worthwhile to note that inflation was close to 9% in the last twodecades of the last millennium and ranged 10.5% during 2009-14. Between2006-16, India was able to raise 271 million people out of poverty, which weall should be proud of.13.     We are now the fifth largest economy of the world. India's foreigndirect investment got elevated to the level of US$ 284 billion during 2014-19 from US$ 190 billioin that came in during the years 2009-14. The CentralGovernment debt that has been the bane of our economy got reduced, inMarch 2019, to 48.7% of GDP from a level of 52.2%in March 2014.14.      With this backdrop, our government shall work towards taking thecountry forward so that we can leapfrog to the next level of health,prosperity and well-being. We shall strive to bring Ease of living for everycitizen.                                         415.     I am mindful of presenting this budget in the backdrop of two cross-cutting developments:      a) Proliferation of technologies, specially analytics, machine learning,         robotics, bio-informatics and Artificial Intelligence; and      b) The number of people in the productive age group i.e. 15-65 years in         India, being at its highest.16.     This combination is special to contemporary India. Across the world,if there is a shrinking of globalisation, equally, there is a debate on theefficacy of monetary policy too. The efforts we have made in the last fiveyears and the energy, enthusiasm and the innovation of our youth are theignition required to push forward. The Indian spirit of entrepreneurshipwhich weathered several storms over the centuries inspire and motivate us.We recognise the need to support and further energise this spirit.17.         This budget is woven around three prominent themes:        One: Aspirational India in which all sections of the society seekbetter standards of living, with access to health, education and better jobs.       Two: Economic development for all, indicated in the PrimeMinister's exhortation of “Sabka Saath , Sabka Vikas , Sabka Vishwas”. Thiswould entail reforms across swathes of the economy. Simultaneously, itwould mean yielding more space for the private sector. Together, theywould ensure higher productivity and greater efficiency.            AND      Three: Ours shall be a Caring Society that is both humane andcompassionate. Antyodaya is an article of faith.18.    The digital revolution which has placed India in a unique leadershipposition globally will see the next wave. We shall aim:            To achieve seamless delivery of services through Digital             governance            To improve physical quality of life through National Infrastructure             Pipeline            Risk mitigation through Disaster Resilience            Social security through Pension and Insurance penetration.      Each one of these initiatives and their components would be bench-marked to international standards and the indices would be announcedsoon.                                       519.     To Summarize my introductory remarks, this Budget Speaker Sir, isdedicated to provide “Ease of Living” to all citizens. As mentioned, a littleearlier, the details under the three broad themes – Aspirational India,Economic Development and Caring India are the flowers in the bouquet thatis Ease of Living. Holding this bouquet together are two hands – one,Corruption free, policy-driven good governance and two, clean and soundfinancial sector.20.    The three themes described earlier form the basis of my subsequentpresentation. They are the flowers of the bouquet that underline the overallconcept of “Ease of Living” and need to uplift Governance, as pronouncedby our Prime Minister Shri Narendra Modi. The chapter on Finances andsubsequent Part B on Taxes provide the necessary underpinning to theBudget that lays the guide map for next year and beyond.        Before, I move to elaborate on each of the three themes, I wish torecite a small verse in Kashmiri:               Saun Watan Gulzar Shalamaar Hyur                Dal Manz Pholvun Pamposh Hyuv          Navjavan-an-hund, Vushun Khumaar Hyuv                     Myon Watan, Chyon Watan                  Saun Watan, Nundbony Watan      (Everything that we do, all of us do, is for this beautiful country)                       Poem by Pandit Dinanath Koul                                      6Aspirational India21.      I shall cover programmes and plans related to: (1) AgricultureIrrigation and Rural development (2) Wellness, Water and Sanitation and (3)Education and SkillsAgriculture, Irrigation and Rural Development22.     Our government is committed to the goal of doubling farmers'incomes by 2022. We have provided energy sovereignty through KUSUMand input sovereignty through Paramparagat Krishi Vikas Yojana. We haveprovided resilience for 6.11 crores farmers insured under PM Fasal BimaYojana. Focus on cultivation of pulses, expansion of micro-irrigation throughKrishi Sinchai Yojana, have raised the self-reliance of the country. Provisionof any annual supplement of the income to the farmer, directly is donethrough PM-KISAN. Connectivity through PMGSY, financial inclusion havehelped raise farm incomes.22 (1). Prosperity to farmers can be ensured by making farmingcompetitive. For this, farm markets need to be liberalised. Distortions infarm and livestock markets need to be removed. Purchase of farm produce,logistics and agri-services need copious investments. Substantial supportand hand-holding of farm-based activities such as livestock, apiary, andfisheries need to be provided for. Farmers desire integrated solutionscovering storage, financing, processing and marketing.23.    Adopting sustainable cropping patterns and bringing in moretechnology are integral to our plan. All this and more can be achievedthrough working with and in cooperation with the States.       The following 16 action points indicate our focus:23 (1). We propose to encourage those State governments who undertakeimplementation of following model laws already issued by the Centralgovernment:          a) Model Agricultural Land Leasing Act, 2016          b) Model Agricultural Produce and Livestock              Marketing             (Promotion and Facilitation) Act, 2017;, and                                      7            c) Model Agricultural Produce and Livestock Contract Farming               and Services (Promotion and Facilitation) Act, 201823 (2). Water stress related issues are now a serious concern across thecountry. Our government is proposing comprehensive measures for onehundred water stressed districts.23 (3). In the Budget speech of July 2019, I had stated that “annadata” canbe “urjadata” too. The PM-KUSUM scheme removed farmers' dependenceon diesel and kerosene and linked pump sets to solar energy. Now, Ipropose to expand the scheme to provide 20 lakh farmers for setting upstand-alone solar pumps; further we shall also help another 15 lakh farmerssolarise their grid-connected pump sets. In addition, a scheme to enablefarmers to set up solar power generation capacity on their fallow/barrenlands and to sell it to the grid would be operationalized.23 (4). Our government shall encourage balanced use of all kinds offertilizers including the traditional organic and other innovative fertilizers.This is a necessary step to change the prevailing incentive regime, whichencourages excessive use of chemical fertilisers.                             மி தி        தி உ                                             ஆ தி          – 82                              Bhumi tiruthi Unn        -    Wise, Old Tamil Woman Saint poet Aauvaiyar – Sangam Era                              "Aaathichoodi" verse 81       The meaning of this saying is that one must “first tend to till one'sland and then eat”. One must eat only after work.23 (5). India has an estimated capacity of 162 million MT of agri-warehousing, cold storage, reefer van facilities etc. NABARD will undertakean exercise to map and geo-tag them. In addition, we propose creatingwarehousing, in line with Warehouse Development and RegulatoryAuthority (WDRA) norms. Our government will provide Viability GapFunding for setting up such efficient warehouses at the block/taluk level.This can be achieved, where States can facilitate with land and are on a PPPmode.      Food Corporation of India (FCI) and Central WarehousingCorporation (CWC) shall undertake such warehouse building on their landtoo.                                       823 (6). As a backward linkage, a Village Storage scheme is proposed to berun by the SHGs. This will provide farmers a good holding capacity andreduce their logistics cost. Women, SHGs shall regain their position as“Dhaanya Lakshmi”.23 (7). To build a seamless national cold supply chain for perishables,inclusive of milk, meat and fish, the Indian Railways will set up a “Kisan Rail”– through PPP arrangements. There shall be refrigerated coaches in Expressand Freight trains as well.23 (8). Krishi Udaan will be launched by the Ministry of Civil Aviation oninternational and national routes. This will immensely help improve valuerealisation especially in North-East and tribal districts.23 (9). Horticulture sector with its current produce of 311million MTexceeds production of food grains. For better marketing and export, wepropose supporting States which, adopting a cluster basis, will focus on“one product one district”.23 (10). Integrated farming systems in rainfed areas shall be expanded.Multi-tier cropping, bee-keeping, solar pumps, solar energy production innon-cropping season will be added. Zero-Budget Natural Farming(mentioned in July 2019 budget) shall also be included. The portal on “jaivikkheti” – online national organic products market will also be strengthened.23 (11). Financing on Negotiable Warehousing Receipts (e-NWR) hascrossed more than`6000 crore. This will be integrated with e-NAM.23 (12). Non-Banking Finance Companies (NBFCs)and cooperatives areactive in the agriculture credit space. The NABARD re-finance scheme willbe further expanded. Agriculture credit target for the year 2020-21 hasbeen set at ` 15 lakh crore. All eligible beneficiaries of PM-KISAN will becovered under the KCC scheme.23 (13). Our government intends to eliminate Foot and Mouth disease,brucellosis in cattle and also peste des petits ruminants (PPR) in sheep andgoat by 2025. Coverage of artificial insemination shall be increased fromthe present 30% to 70%. MNREGS would be dovetailed to develop fodderfarms. Further, we shall facilitate doubling of milk processing capacity from53.5 million MT to 108 million MT by 2025.23 (14). Blue Economy: Our government proposes to put in place aframework for development, management and conservation of marinefishery resources.                                      923 (15). Youth in coastal areas benefit through fish processing andmarketing. By 2022-23, I propose raising fish production to 200 lakhtonnes. Growing of algae, sea-weed and cage Culture will also be promoted.        Our government will involve youth in fishery extension through 3477Sagar Mitras and 500 Fish Farmer Producer Organisations. We hope to raisefishery exports to ` 1 lakh crore by 2024-25.23 (16). Under Deen Dayal Antyodaya Yojana for alleviation of poverty, 58lakh SHGs have been mobilised. We shall further expand on SHGs.24.    Now, for the fund allocation for the 16 different steps mentionedabove, they are being stated under two different categories:         For the sector comprising of Agriculture and allied activities,Irrigation and Rural Development an allocation of about ` 2.83 lakh crorehas been made for the year 2020-21 . Its divided, inter-alia;   a) For Agriculture, Irrigation & allied activities   - ` 1.60 lakh crore   b) For Rural development & Panchayati Raj            - ` 1.23 lakh crore   Wellness, Water and Sanitation   Under Aspirational India, I shall now speak about Wellness, Water andSanitation.25.     We have a holistic vision of healthcare that translates into wellnessof the citizen. Mission Indradhanush has been expanded to cover 12 suchdiseases, including five new vaccines. FIT India movement is a vital part offight against Non communicable diseases coming out of life style issues . Avery focused safe water (Jal Jeevan Mission) and comprehensive sanitationprogram (Swachch Bharat Mission) have been launched to support thehealth vision. That would reduce the disease burden on the poor.26.    Presently, under PM Jan Arogya Yojana (PMJAY) ,there are morethan 20,000 empanelled hospitals. We need more in Tier-2 and Tier-3 citiesfor poorer people under this scheme.                                      1026 (1). It is proposed to set up Viability Gap funding window for setting uphospitals in the PPP mode. In the first phase, those Aspirational Districts willbe covered, where presently there are no Ayushman empanelled hospitals.This would also provide large scale employment opportunities to youth.Proceeds from taxes on medical devices would be used to support this vitalhealth infrastructure26 (2). Using machine learning and AI, in the Ayushman Bharat scheme,health authorities and the medical fraternity can target disease with anappropriately designed Preventive regime.27.    “TB Harega Desh Jeetega” campaign has been launched. I propose tostrengthen these efforts realise our commitment to end Tuberculosis by2025.28.     I propose to expand Jan Aushadhi Kendra Scheme to all districtsoffering 2000 medicines and 300 surgicals by 2024.        I have provided for the health sector about `69,000 crores that isinclusive of ` 6400 crores for Prime Minister Jan Arogya Yojana (PMJAY)29.    Our government is committed to ODF Plus in order to sustain ODFbehaviour and to ensure that no one is left behind. Now, more needs to bedone towards liquid and grey water management. Focus would also be onSolid waste collection, source segregation and processing.      Total allocation for Swachh Bharat Mission is about `12,300 crore in2020-21.30.     Aiming to provide piped water supply to all households, PrimeMinister announced from the Red Fort the Jal Jeevan Mission. Ourgovernment has approved `3.60 lakh crore for this Mission. This schemealso places emphasis on augmenting local water sources, recharging existingsources and will promote water harvesting and de-salination. Cities withover a million population will be encouraged to meeting this objectiveduring the current year itself.       During the year 2020-21 the scheme would be provided budget of` 11,500 crore.                                      11       Education and Skills       The third and the final item under Aspirational India is Educationand Skills.31.      By 2030, India is set to have the largest working-age population inthe world. Not only do they need literacy but they need both job and lifeskills. Dialogues have been held with State Education Ministries, Membersof Parliament and other stake-holders about Education policy. Over 2 lakhsuggestions were also received. The New Education Policy will beannounced soon.32.     It is felt that our education system needs greater inflow of finance toattract talented teachers, innovate and build better labs. Therefore stepswould be taken to enable sourcing External Commercial Borrowings and FDIso as to able to deliver higher quality education.33.     Students in the general stream (vis-à-vis services or technologystream) need their employability improved. About 150 higher educationalinstitutions will start apprenticeship embedded degree/diploma courses byMarch 2021.34.    The government proposes to start a programme whereby urbanlocal bodies across the country would provide internship opportunities tofresh engineers for a period up to one year.35.     In order to provide quality education to students of deprived sectionof the society as well as those who do not have access to higher education,it is proposed to start degree level full-fledged online educationprogramme. This shall be offered only by institutions who are ranked withintop 100 in the National Institutional Ranking framework. Initially, only a fewsuch institutions would be asked to offer such programmes.36.    India should be a preferred destination for higher education. Hence,under its “Study in India” programme, Ind-SAT is proposed to be held inAsian and African countries. It shall be used for benchmarking foreigncandidates who receive scholarships for studying in Indian higher educationcentres.                                     1237.    A National Police University and a National Forensic ScienceUniversity are being proposed in the domain of policing science, forensicscience, cyber-forensics etc.38.     There is a shortage of qualified medical doctors, both generalpractitioners as well as specialists. In order to meet this requirement;38 (1). It is proposed to attach a medical college to an existing districthospital in PPP mode. Those states that fully allow the facilities of thehospital to the medical college and wish to provide land at a concession,would be able to receive Viability Gap Funding. Details of the scheme wouldbe worked out.38 (2). National Board of Examination imparts PG medical qualifications ;Diploma and fellow of National Board (DNB/FNB). The Government will,therefore encourage large hospitals with sufficient capacity to offer residentdoctors DNB/FNB courses under the National Board of Examinations.39.     There exists a huge demand for teachers, nurses, para-medical staffand care-givers abroad. However, their skill sets, many a time, do notmatch the employer's standards and therefore need to be improved. Ipropose that special bridge courses be designed by the Ministries of Health,Skill Development together with professional bodies to bring in equivalence.Language requirements of various countries need also to be included. Allthese should be achieved through special training packages.       Our Government proposes to provide about ` 99,300 crore foreducation sector in 2020-21 and about ` 3,000 crores for skill development.Economic DevelopmentIndustry, Commerce and Investment       The guilds of Saraswati-Sindhu civilization & the Harappan seals areremarkable. They belong to 3300 BCE. Words from the Indus Script-hieroglyphs have been deciphered. Commerce and trade related wordsshow how India for a millennia is continuing as rich in skills, metallurgy,trade etc. “Takara Kolimi=Tin smithery”, “ Sreni “= Guild ,” Sethi”=wholesale merchant, “Poddar”= Assayer of metal into treasury.                                     1340.     Entrepreneurship has always been the strength of India. Even today,young men and women have given up greener pastures elsewhere tocontribute to India's growth. They are risk-taking and come up withdisruptive solutions to festering challenges. Equally, established oldindustries are resetting themselves in a changing global and domesticsituation. We recognise the knowledge, skills and risk-taking capabilities ofour youth. He is no longer the job seeker. He is creator of jobs. Now wewish to create more opportunities and remove road-blocks from his path.        I propose to set up an Investment Clearance Cell that will provide“end to end” facilitation and support, including pre-investment advisory,information related to land banks and facilitate clearances at Centre andState level. It will work through a portal.41.      There is a case for maximising the benefits of three separatelydeveloping economic activities: (1) the upcoming economic corridors; (2)revitalisation of manufacturing activities; and (3) Technology and thedemands of aspirational classes. We have to benefit from theirconvergence. Hence, it is proposed to develop five new smart cities incollaboration with States in PPP mode. Such sites would be chosen thatoffer the best choices in terms of aforementioned principles.42.     India needs to manufacture Networked products. That will make it apart of global value chains. This in turn gets more investment and generatesmore employment for our youth.42 (1). Electronics manufacturing industry is very competitive and India hasshown its cost advantages. The potential of this industry in job creation isimmense. India needs to boost domestic manufacturing and attract largeinvestments in the electronics value chain. Here, I propose a schemefocussed on encouraging manufacture of mobile phones, electronicequipment and semi-conductor packaging. Details would be announcedlater.42(2). With suitable modifications, this scheme can be adapted formanufacture of medical devices too43.     India imports significant quantity of technical textiles worth US$ 16billion every year. To reverse this trend and to position India as a global                                      14leader in Technical Textiles, a National Technical Textiles Mission isproposed with a four-year implementation period from 2020-21 to 2023-24at an estimated outlay of ` 1480 crore.44.     From the Red Fort, our Prime Minister spoke about quality andstandards when he spoke of “Zero Defect-Zero Effect” manufacturing. InSeptember last year, I had called for a time-bound adoption by industry ofall necessary, mandatory technical standards and their effectiveenforcement. All Ministries, during the course of this year, would be issuingquality standard orders.45.     To achieve higher export credit disbursement, a new scheme, NIRVIKis being launched, which provides for higher insurance coverage, reductionin premium for small exporters and simplified procedure for claimsettlements.46.    It is proposed to digitally refund to exporters, duties and taxes leviedat the Central, State and local levels, such as electricity duties and VAT onfuel used for transportation, which are not getting exempted or refundedunder any other existing mechanism. This Scheme for Reversion of dutiesand taxes on exported products will be launched this year.47.    It is the vision of the Prime Minister that each District shoulddevelop as an export hub. Efforts of the Centre and State governments arebeing synergised and institutional mechanisms are being created.48.    Government e-Marketplace (GeM) is moving ahead for creating aUnified Procurement System in the country for providing a single platformfor procurement of goods, services and works. It offers a great opportunityfor Medium, Small and micro Enterprises(MSMEs). 3.24 lakh vendors arealready on this platform. Its proposed to take its turnover to ` 3lakh crores.      I propose to provide about ` 27,300 crore for development andpromotion of Industry and Commerce for the year 2020-21.        Under the theme “Economic Development”, the second focus is onInfrastructure.                                      15Infrastructure49.      Hon'ble Speaker, Sir, in his Independence Day speech 2019, PrimeMinister had highlighted that ` 100 lakh crore would be invested oninfrastructure over the next 5 years. As a follow up measure, I had launchedthe National Infrastructure Pipeline on 31st December 2019 of ` 103 lakhcrore. It consists of more than 6500 projects across sectors and areclassified as per their size and stage of development.        These new projects will include housing, safe drinking water, accessto clean and affordable energy, healthcare for all, world-class educationalinstitutes, modern railway stations, airports, bus terminals, metro andrailway transportation, logistics and warehousing, irrigation projects, etc.The National Infrastructure Pipeline envisions improving the ease of livingfor each individual citizen in the country. It's also will bring in generic andsectoral reforms in development, operation and maintenance of theseinfrastructure projects.       A huge employment opportunity exists for India's youth inconstruction, operation and maintenance of infrastructure. National SkillDevelopment Agency will give special thrust to infrastructure-focused skilldevelopment opportunities.50 (1). I propose to set up a project preparation facility for infrastructureprojects. This programme would actively involve young engineers,management graduates and economists from our Universities.50 (2). It is also proposed to direct all infrastructure agencies of thegovernment to involve youth-power in start-ups. They will help in rollingout value added services in quality public infrastructure for citizens.51.     A National Logistics Policy will be released soon. Inter alia; it willclarify the roles of the Union Government, State Governments and keyregulators. It will create a single window e-logistics market and focus ongeneration of employment, skills and making MSMEs competitive.52.     Accelerated development of highways will be undertaken. This willinclude development of 2500 Km access control highways, 9000 Km ofeconomic corridors, 2000 Km of coastal and land port roads and 2000 Km ofstrategic highways.                                      16      Delhi-Mumbai Expressway and two other packages would becompleted by 2023 . Chennai-Bengaluru Expressway would also be started.53.   FASTag      mechanism      encourages     us     towards    greatercommercialisation of our highways so that NHAI can raise more resources. Ipropose to monetise at least twelve lots of highway bundles of over 6000Km before 2024.54.     In carrying out its duty, the Indian Railways performs a service to thenation.    a) Within 100 days of assumption of this government, it has       commissioned 550 wi-fi facilities in as many stations.    b) Eliminated unmanned crossings    c) Aims to achieve electrification of 27000 Km of tracks.    This will call for optimisation of costs. Railways has small operatingsurplus. About Indian Railways, there are five measures, among others, thatI wish to highlight:      Setting up a large solar power capacity alongside the rail tracks, on       the land owned by the railways. A proposal is under consideration.      Four station re-development projects and operation of 150       passenger trains would be done through PPP mode. The process of       inviting private participation is underway.      More Tejas type trains will connect iconic tourist destinations.      High speed train between Mumbai to Ahmedabad would be actively       pursued.      148 km long Bengaluru Suburban transport project at a cost of       ` 18600 crore, would have fares on metro model. Central       Government would provide 20% of equity and facilitate external       assistance up to 60% of the project cost.                                    1755.   Our sea-ports need to be more efficient. Technology has to used toimprove performance. A governance framework keeping with globalbenchmarks needs to be put in place.       This government would consider corporatizing at least one majorport and subsequently its listing on the stock exchanges.56.    Inland Waterways received a boost in the last five years. The JalVikas Marg on National Waterway-1 will be completed. Further, the 890 KmDhubri-Sadiya connectivity will be done by 2022.       Developing waterways has its impact on the eco-system on both thebanks of the river. Our Prime Minister has conceptualised “Arth Ganga”.Plans are afoot to energise economic activity along river banks.57.     Air traffic has been growing rapidly in the country as compared toglobal average. One hundred more airports would be developed by 2024 tosupport Udaan scheme. It is expected that the air fleet number shall go upfrom the present 600 to 1200 during this time.        I propose to provide about ` 1.70 lakh crore for transportInfrastructure in 2020-21.58.     Taking electricity to every household has been a major achievement.However, the distribution sector, particularly the DISCOMS are underfinancial stress. The Ministry intends to promote “smart” metering. I urgeall the States and Union Territories to replace conventional energy metersby prepaid smart meters in the next 3 years. Also, this would giveconsumers the freedom to choose the supplier and rate as per theirrequirements.       Further measure to reform DISCOMs would be taken.       I propose to provide about ` 22,000 crore to power and renewableenergy sector in 2020-2159.     In the upstream sector of oil and gas, the Open Acreage LicensingPolicy (OALP) is a success having awarded 1,37,000 sq km for exploration toprivate sector and to the CPSEs. City gas distribution rights are alsoawarded.                                       1860 (1). Further, it is proposed to expand the national gas grid from thepresent 16200 km to 27000 km, and60 (2). To deepen gas markets in India, further reforms will be undertakento facilitate transparent price discovery and ease of transactions.New Economy61.    The new economy is based on innovations that disrupt establishedbusiness models. Artificial intelligence, Internet-of-Things (IoT), 3D printing,drones, DNA data storage, quantum computing, etc., are re-writing theworld economic order. India has already embraced new paradigms such asthe sharing economy with aggregator platforms displacing conventionalbusinesses. Government has harnessed new technologies to enable directbenefit transfers and financial inclusion on a scale never imagined before.62.     It is now a cliché – “data is the new oil” and it is true that Analytics,Fintech and Internet of Things (IOT) are changing the way we deal with ourlives. To take advantage of this, I propose:62 (1). To bring out soon a policy to enable private sector to build DataCentre parks throughout the country. It will enable our firms to skilfullyincorporate data in every step of their value chains.62 (2). Our vision is that all “public institutions” at Gram Panchayat levelsuch as Anganwadis, health and wellness centres, government schools, PDSoutlets, post offices and police stations will be provided with digitalconnectivity. So, Fibre to the Home (FTTH) connections through Bharatnetwill link 100,000 gram panchayats this year.       It is proposed to provide ` 6000 crore to Bharatnet programmein 2020-21.63.     We need to expand the base for knowledge-driven enterprises.Intellectual property creation and protection will play an important role.Several measures are proposed in this regard, which will benefit the Start-ups.                                     1963 (1). A digital platform would be promoted that would facilitate seamlessapplication and capture of IPRs. Also, in an Institute of Excellence, a Centrewould be established that would work on the complexity and innovation inthe field of Intellectual Property.63 (2). Knowledge Translation Clusters would be set up across differenttechnology sectors including new and emerging areas.63 (3). For designing, fabrication and validation of proof of concept, andfurther scaling up Technology Clusters, harbouring such test beds and smallscale manufacturing facilities would be established.63 (4). Mapping of India's genetic landscape is critical for next generationmedicine, agriculture and for bio-diversity management. To support thisdevelopment, we will initiate two new national level Science Schemes, tocreate a comprehensive database.63 (5). The government proposes to provide early life funding, including aseed fund to support ideation and development of early stage Start-ups.64.    Quantum technology is opening up new frontiers in computing,communications, cyber security with wide-spread applications. It isexpected that lots of commercial applications would emerge fromtheoretical constructs which are developing in this area.        It is proposed to provide an outlay of ` 8000 crore over a period fiveyears for the National Mission on Quantum Technologies and Applications.                               Caring Society       In our third theme we focus on Women & Child, Social Welfare;Culture and Tourism and also on Environment and Climate Change.Women & Child, Social Welfare65.     I am pleased to inform the House that “Beti Bachao Beti Padhao”has yielded tremendous results. Gross enrolment ratio of girls across alllevels of education is now higher than boys. At elementary level, it is 94.32% as against 89.28% for boys. At Secondary level, it is 81.32 % as comparedto 78 %, At higher secondary level girls have achieved a level of 59.70 % ascompared to 57.54 % for boys.                                     2066.      Health of mother and child are closely corelated. Nutrition is thecritical component of health. To improve the nutritional status of children(0-6 years), adolescent girls, pregnant women and lactating mothers, ourPrime Minister launched a “Poshan Abhiyan” in 2017-18. More than sixlakh anganwadi workers are equipped with smart phones to upload thenutritional status of more than 10 crore households. The scale of thesedevelopments is unprecedented.67.     Women's age of marriage was increased from fifteen years toeighteen years in 1978, by amending erstwhile Sharda Act of 1929. As Indiaprogresses further, opportunities open up for women to pursue highereducation and careers. There are imperatives of lowering MMR as well asimprovement of nutrition levels. Entire issue about age of a girl enteringmotherhood needs to be seen in this light. I propose to appoint a task forcethat will present its recommendations in six months' time.        I propose to provide ` 35600 crore for nutrition-related programmesfor the financial year 2020-21.68.     In continuing with our government's commitment to the welfare ofwomen, this budget provides for about ` 28,600 crore for programs that arespecific to women.69.      Our government is determined that there shall be no manualcleaning of sewer systems or septic tanks. Suitable technologies for suchtasks have been identified by the Ministry of Housing and Urban Affairs. TheMinistry is working with urban local bodies for the adoption of thesetechnologies. We will now take this to its logical conclusion throughlegislative and institutional changes. Financial support for wider acceptanceof such technologies will be provided.70     In furthering this government's commitment towards the welfare ofScheduled Castes and Other Backward classes, I propose a budget provisionof about ` 85,000 crore for 2020-21.71. In furthering development and welfare of Scheduled tribes, I provide inthe Budget for the year 2020-21 an amount of about ` 53,700 crore.                                     2172.    This government is mindful of the concerns of senior citizens andDivyang. Accordingly, an enhanced allocation of about ` 9,500 crore is beingprovided for 2020-21.Culture & Tourism73.    Our government proposes to establish an Indian Institute ofHeritage and Conservation under Ministry of Culture; it shall have the statusof a deemed University to start with. Acquisition of knowledge in disciplinessuch as museology and archaeology are essential for collecting andanalysing scientific evidence of such findings and for dissemination throughhigh quality museums. Currently lack of trained man-power is a handicapfor both these disciplines. This also affects tourism.74.    Five archaeological sites would be developed as iconic sites with on-site Museums. They are: Rakhigarhi (Haryana), Hastinapur (Uttar Pradesh)Shivsagar (Assam), Dholavira (Gujarat) and Adichanallur (Tamil Nadu).75.    Our Prime Minister in January 2020 announced re-curation of theIndian Museum in Kolkata, which is the oldest in the country.75 (1). In the historic Old Mint building Kolkata, a museum on Numismaticsand Trade will also be located. Four more museums from across thecountry shall be taken up for renovation and re-curation so that a worldclass experience can be offered to visitors. Our government shall alsosupportsetting up of a Tribal Museum in Ranchi (Jharkhand).75 (2). A maritime museum would be set up at Lothal - the Harrapan agemaritime site near Ahmedabad, by Ministry of Shipping.      I propose to provide ` 3,150 crore for Ministry of Culture for2020-21.76.    India has moved up from rank 65 in 2014 to 34 in 2019 in the Travel& Tourism Competitive Index (World Economic Forum). Foreign exchangeearnings grew 7.4% to `1.88 lakh crores for the period January toNovember 2019 from `1.75 lakh crores                                      22        Growth of tourism directly relates to growth and employment.States have a critical role to play. I expect the State governments to developa roadmap for certain identified destinations and formulate financial plansduring 2021 against which specified grants will be made available to theStates in 2020-21.        For purpose of tourism promotion, I propose to allocate ` 2,500crore for 2020-21.Environment & Climate Change77.     In September 2019, the Prime Minister has launched the Coalitionfor Disaster Resilient Infrastructure (CDRI) with its Secretariat in Delhi. Thisglobal partnership is the second such international initiative after thelaunch of International Solar Alliance in 2015. This Global Partnership willhelp in addressing a number of Sustainable Development Goals (SDGs), asalso the aims of Sendai framework. It will enhance climate changeadaptation with a focus on disaster resilient infrastructure78.    India submitted its Nationally Determined Contribution, under theParis Agreement in 2015 on a “best effort” basis, keeping in mind thedevelopment imperative of the country. Its implementation effectivelybegins on 1st January 2021. Our commitments as action will be executed invarious sectors by the Departments/Ministries concerned through thenormal budgeting process.79.    There are yet, thermal power plants that are old and their carbonemission levels are high.        For such power plants, we propose that utilities running them wouldbe advised to close them, if their emission is above the pre-set norms. Theland so vacated can be put to alternative use.80.    In large cities having population above one million, clean air is amatter of concern. The government proposes to encourage such States thatare formulating and implementing plans for ensuring cleaner air in citiesabove one million. Parameters for the incentives would be notified by theMinistry of Environment, Forests and Climate change. Allocation for thispurpose is `4400 crore for 2020-21.                                     23                               ந    ல நாபணய          ைம,          ெச     வ             வ ைளவ        ப         ஏமஅண ெய          ப நா             ைவ         .                                                                  ற     - 738(The meaning of this kural is that Freedom from illness, wealth, produce,happiness and protection (to subjects); these five, are the ornaments of akingdom).                                Governance81.      Hon'ble Speaker, Sir, all the while I have explained the colour andcomposition of the bouquet of flowers – schemes and programmes. Theywere grouped under Aspirational India, Economic Development and CaringIndia. Now I speak about the two hands that will hold them. One such handis Governance – clean, corruption-free, policy driven and good in intent andmost importantly trusting in faith. Trusting every citizen, the aspirationalyouth, the hard-working women, the risk-taking entrepreneur, the everhopeful and untiring farmer or the wise and old senior citizen. Many amongthem are taxpayers. Others may not be taxpayers today. Our PrimeMinister has laid before us Ease of Living as a goal to be achieved on behalfof all citizens. An important aspect of both ease of living and ease of doingbusiness is fairness and efficiency of tax administration. We wish toenshrine in the statutes a “taxpayer charter” through this budget. Ourgovernment would like to reassure taxpayers that we remain committed totaking measures so that our citizens are free from harassment of any kind.82.      There has been a debate about building into statutes, criminalliability for acts that are civil in nature. Hence, for Companies Act, certainamendments are proposed to be made that will correct this. Similarly, otherlaws would also be examined, where such provisions exist and attemptswould be made to correct them.83.    The Government intends to introduce major reforms in recruitmentto Non-Gazetted posts in governments and public sector banks. At present,candidates have to appear for multiple examinations conducted by multipleagencies at different points of time, for similar posts This places enormous                                      24burden on time, effort and cost of young people. To mitigate their hardshipfaced, it is proposed to set up a National Recruitment Agency (NRA) as anindependent, professional, specialist organisation for conduct of acomputer-based online Common Eligibility Test for recruitment to Non-Gazetted posts. A test-centre in every district, particularly in theAspirational Districts would be set up.84.    For speedy disposal of commercial and other disputes, Governmenthas constituted various Tribunals and specialised bodies. It is proposed toevolve a robust mechanism for appointment including direct recruitment tothese bodies to attract best talents and professional experts.85.    A stable and predictable business environment is a key objective ofthis government. There is also a strong argument for ensuring thatcontracts are honoured. India has a sound framework related to ContractsAct. We shall deliberate upon strengthening it.86.      There is a growing need for the Indian Statistical system to meet thechallenges of real time monitoring of our increasingly complex economy.Data must have strong credibility. The proposed new National Policy onOfficial Statistics would use latest technology including AI. It would lay downa road-map towards modernised data collection, integrated informationportal and timely dissemination of information.87.     I am happy to inform that India will host G 20 presidency in the year2022 - the year of 75th anniversary of independence of Indian Nation. Duringthis presidency, India would be able to drive considerably the globaleconomic and development agenda. For this historic occasion, I allocate asum of ` 100 crore to begin the preparations.88.     North Eastern region has a very high priority in Government'sDevelopmental agenda. Government is ensuring smooth access to financialassistance from multilateral and bilateral funding agencies to help introduceinnovative and global best practices. Central Government has effectivelyused an online portal to reduce gestation period of online. This hasimproved the flow of funds to the northeast region.89.    The Government is fully committed to supporting the all-rounddevelopment of the newly formed Union Territories of J&K and the Union                                      25Territory of Ladakh. Accordingly, an amount of `30,757 crore has beenprovided for the Financial Year 2020-21. An amount of `5,958 crore hasbeen provided for the Union Territory of LadakhFinancial Sector90.     If Governance was described as one of the pair of hands holding thebouquet consisting of Aspirational India, Economic Development and CaringIndia, the other is the Financial Sector. A clean, reliable and robust financialsector is critical to the economy. In our efforts to achieve the USD 5 trillioneconomy, the financial architecture should keep evolving and move fromstrength to strength.91.     We had earlier approved consolidation of 10 banks into four. In thelast few years, Government of India has infused about ` 3,50,000 crore byway of capital into Public Sector Banks for regulatory and growth purposes.Governance reforms would be carried out in these banks, so that theybecome more competitive.        A few among them will be encouraged to approach capital market toraise additional capital.92.    I wish to inform this august House that robust mechanism is in placeto monitor the health of all Scheduled Commercial Banks and thatdepositors' money is safe.       Further, the Deposit Insurance and Credit Guarantee Corporation(DICGC) has been permitted to increase Deposit Insurance Coverage for adepositor, which is now ` one lakh to ` five lakh per depositor.93.    To strengthen the Cooperative Banks, amendments to the BankingRegulation Act are proposed for increasing professionalism, enabling accessto capital and improving governance and oversight for sound bankingthrough the RBI.94.     The limit for NBFCs to be eligible for debt recovery under theSecuritization and Reconstruction of Financial Assets and Enforcement ofSecurity Interest (SARFAESI) Act 2002 is proposed to be reduced from ` 500                                      26crore to asset size of ` 100 crore or loan size from existing ` 1 crore to ` 50lakh.95.    In the last few years, the government has taken concrete steps tobring our banking system to be robust. However, there is a need for greaterprivate capital. Accordingly, it is proposed to sell the balance holding ofGovernment of India IDBI Bank to private, retail and institutional investorsthrough the stock exchange.96.    There is a need to take further steps to bring in transparency andgreater professionalism in Public Sector Banks. The government will takeappropriate measures.97.     To help easy mobility while in jobs, we wish to infuse into theUniversal Pension coverage with auto enrolment; also, we wish to placesuch mechanisms which can enable inter-operability and provide safeguardsfor the accumulated corpus.        Regulating role of PFRDAI requires strengthening. Necessaryamendments would be carried out in Pension Fund RegulatoryDevelopment Authority of India Act that will also facilitate separation ofNPS trust for government employees from PFRDAI. This would also enableestablishment of a Pension Trust by the employees other than Government.I am confident that this will motivate citizens to plan for their old age.98.    MSMEs are vital to keep the wheels of economy moving. They alsocreate job, innovate and are risk takers. Several measures for the MSMEshave been taken in the past few years. There are more steps proposed inthis budget also.98(1). I propose to make necessary amendments to the Factor RegulationAct 2011. This will enable NBFCs to extend invoice financing to the MSMEsthrough TReDS, thereby enhancing their economic and financialsustainability.98(2). Working capital credit remains a major issue for the MSMEs. It isproposed to introduce a scheme to provide subordinate debt forentrepreneurs of MSMEs. This subordinate debt to be provided by bankswould count as quasi-equity and would be fully guaranteed through the                                      27Credit Guarantee Trust for Medium and Small Entrepreneurs (CGTMSE). Thecorpus of the CGTMSE would accordingly be augmented by thegovernment.98(3). More than five lakh MSMEs have benefitted from restructuring ofdebt permitted by RBI in the last year. The restructuring window was toend on March 31, 2020. Government has asked RBI to consider extendingthis window till March 31, 2021.98(4). An app-based invoice financing loans product will be launched. Thiswill obviate the problem of delayed payments and consequential cash flowsmismatches for the MSMEs.99.     Many mid-size companies are successful domestically but not inexport markets. For selected sectors such as pharmaceuticals, autocomponents and others, we propose to extend handholding support – fortechnology upgradations, R&D, business strategy etc. A scheme of ` 1000crore will be anchored by EXIM Bank together with SIDBI. Both theseinstitutions would contribute ` 50 crore each. This ` 100 crore would beachieved towards equity and technical assistance. Debt funding of `900crore from banks would be made available.Financial Markets100. Last year, in the budget speech, I had mentioned about deepeningthe bond market. To achieve the aspirational growth rate, we would requireflow of capital in our financial system. A lot of work has been done on this inconsultation with the RBI.       Hon'ble Speaker, Sir, I am pleased to inform this House of thedevelopments:100 (1). Certain specified categories of Government securities would beopened fully for non-resident investors, apart from being available todomestic investors as well.100 (2). The limit for FPI in corporate bonds, currently at 9% of outstandingstock, will be increased to 15% of the outstanding stock of corporate bonds.                                      28100(3). To improve investors' confidence and to expand the scope of creditdefault swaps, we propose to formulate a legislation, to be placed soonbefore the House, for laying down a mechanism for netting of financialcontracts.101. The Debt-based Exchange Traded Fund (ETF) recently floated by thegovernment was a big success. Government proposes to expand this byfloating a new Debt-ETF consisting primarily of government securities.       This will give retail investors access to government securities asmuch as giving an attractive investment for pension funds and long-terminvestors.102. To address the liquidity constraints of the NBFCs/HFCs, post theUnion budget 2019-20, the government formulated a Partial CreditGuarantee scheme for the NBFCs. To further this support of providingliquidity, a mechanism would be devised. Government will offer support byguaranteeing securities so floated.Infrastructure Financing103. Government's commitment for investment in infrastructure wasreiterated when `103 lakh crore National Infrastructure Pipeline projectswere announced. I would also like to inform that about ` 22,000 crore hasalready been provided, as support to Infrastructure Pipeline. This wouldcater for equity support to Infrastructure Finance Companies such as IIFCLand a subsidiary of NIIF. They would leverage it, as permissible, to createfinancing pipeline of more than `1,00,000 crore. This would create a majorsource of long term debt for infrastructure projects and fulfil a longawaited requirement.104. IFSC, GIFT city has the potential to become a centre of internationalfinance as well as a centre for high end data processing:104 (1). GIFT IFSC has an approved Free Trade zone for housing vaults. Italready has 19 insurance entities, 40 banking entities. It has also providedfor setting up of precious metals testing laboratories and refining facilities.With the approval of the regulator, GIFT City would set up an InternationalBullion exchange(s) in GIFT-IFSC as an additional option for trade by global                                      29market participants. This will enable India to enhance its positionworldwide, create jobs in India and will lead to better price discovery ofgold.104 (2). In recent years there has been a surge in trading volumes of Indianrupee in the offshore financial centres. The Government and RBI has takenvarious measures to permit Rupee derivatives to be traded in theInternational Financial Services Centre at GIFT city, Gujarat.Disinvestment105. Listing of companies on stock exchanges discipline a company andprovides access to financial markets and unlocks its value. It also givesopportunity for retail investors to participate in the wealth so created. Thegovernment now proposes to sell a part of its holding in LIC by way of InitialPublic Offer (IPO).Fiscal Management106. XV Finance Commission has given its first report pertaining toFinancial Year 2020-21. In the spirit of co-operative federalism, I ampleased to announce that we have, in substantial measure, accepted therecommendations of the Commission. The commission would submit itsfinal report to the President during the latter part of the year, for five yearsbeginning 2021-22.107. It is decided to transfer to the GST Compensation Fund balances dueout of collection of the years 2016-17 and 2017-18, in two instalments.Hereinafter, transfers to the fund would be limited only to collection by wayof GST compensation cess.108. A fundamental overhaul of Centrally Sponsored Schemes andCentral Sector Schemes is necessary, to align them with emerging social andeconomic needs of tomorrow, and to ensure that scarce public resourcesare spent optimally.109. Recently there has been a debate over transparency and credibilityof the projected fiscal numbers. Let me assure the House that the                                     30procedure adopted is compliant with the FRBM Act. This is also consistentwith the practices hitherto followed.       However, for greater clarity, I have enumerated those centralGovernment debt that are not part of market borrowing and are used tofund the expenditure at the annexes. Servicing of interest and repaymentof these debts as hitherto, are done out of Consolidated fund of India.110. Revised Estimates of Expenditure for the Financial Year 2019-20 areat a level of ` 26.99 lakh Crore and the receipts are estimated at `19.32 lakhcrore.          We have estimated nominal growth of GDP for year 2020-21, on thebasis of trends available, at 10%. Accordingly, receipts for the year 2020-21are estimated at ` 22.46 lakh cr and, keeping in mind commitment of theGovernment towards various schemes and need for improvement in qualityof life, level of expenditure has been kept at ` 30.42 lakh crore.        During the year Government has unfailingly worked towards keepingup the capital expenditure. Actually, there is substantial enhancement. Allthe flagship schemes of the government have been fully provided for.Details may be seen at the annexes to the printed copy of my speech.111. Every budget must appropriately address the issue of fiscal deficit.Recently Government has undertaken very significant tax reforms forboosting investments. However, expected tax buoyancy will take time.      We estimate a fiscal deficit of 3.8% in RE 2019-20 and 3.5% forBE 2020-21. This estimation is consistent with Government's abidingcommitment to macroeconomic stability. It comprises of,   (a) 3.3% for year 2019-20, and 3% for the 2020-21 budget estimate;   (b) Section 4 (2) of the FRBM Act provides for a trigger mechanism for       a deviation from the estimated fiscal deficit on account of structural       reforms in the economy with unanticipated fiscal implications.       Therefore, I have taken a deviation of 0.5%, consistent with Section       4(3) of FRBM Act, both for RE 2019-20 and BE 2020-21.                                     31      Accordingly, the return path is being laid before the parliament as a   part of Medium Term Fiscal Policy cum Strategy Statement. This fiscal   path commits us to the path of fiscal consolidation without   compromising the needs of investment out of public funds.        Accordingly, net market borrowings for the year 2019-20 would be` 4.99 lakh crore and for the year 2020-21, it would be ` 5.36 lakh crore.112. A good part of the borrowings for the financial year 2020-21 wouldgo towards Capital expenditure of the Government that has been scaled upby more than 21%. As, I had previously mentioned another about ` 22,000crore have been allocated for equity to fund certain specified infrastructurefinance companies, who would leverage it manifold and provide muchneeded long-term finance to Infrastructure sector. That should spur growthimpulses in the economy.       I would, now, move to Part B of my speech.                                      32                                   PART BDirect Tax113. Mr Speaker, Sir, our Government has spearheaded radical fiscalmeasures to ensure that India's economy continues to tread the path ofhigh growth. These are times when countries are competing with eachother like never before to become the most attractive destination for doingbusiness. Therefore, to make sure that India stays globally competitive anda favoured destination for investment, we took a bold historic decision ofreducing the corporate tax rate for new companies in the manufacturingsector to an unprecedented level of 15%. Similarly, for the existingcompanies, the rate has also been brought down to just 22%. As a result,our corporate tax rates are now amongst the lowest in the world. This willenable companies to expand their businesses and make fresh investmentsin the coming future. Though we will have loss of substantial revenue due tothese measures in the short-run, I am certain that our economy will reaphuge returns on this score in due course.                        जानामेवभू थसता ोबिलम हीत्।                        सह गु णमु टु माद ेिहरसंरिवः॥ Surya, the Sun, collects vapour from little drops of water. So does the King.     They give back copiously. They collect only for people's wellbeing.                  [Verse 18, Sarga 1 Raghuvamsa by Kalidasa]114. In continuation of the reform measures already taken so far, the taxproposals in this budget will introduce further reforms to stimulate growth,simplify tax structure, bring ease of compliance, and reduce litigations.115.   Personal Income Tax and simplification of taxation    In the interim Budget of 2019, our government exempted       individuals having income up to ` 5 Lakh from paying any income       tax. Presently, an individual pays 20% on income between ` 5 Lakh       to ` 10 Lakh and 30% on income above ` 10 Lakh.             Further,       currently the Income Tax Act is riddled with various exemptions and       deductions which make compliance by the taxpayer and       administration of the Income Tax Act by the tax authorities a                                33   burdensome process. It is almost impossible for a taxpayer to   comply with the Income-tax law without taking help from   professionals. In order to provide significant relief to the individual taxpayers and   to simplify the Income-tax law, I propose to bring a new and   simplified personal income tax regime wherein income tax rates will   be significantly reduced for the individual taxpayers who forgo   certain deductions and exemptions. Under the new regime, an individual shall be required to pay tax at   the reduced rate of 10% for income between ` 5 Lakh to ` 7. 5   Lakh against the current rate of 20%. For income between ` 7.5 Lakh to ` 10 Lakh he will pay at the   reduced rate of 15% against the current rate of 20 %. Similarly for the income between ` 10 Lakh to ` 12.5 Lakh the   taxpayer will pay at the reduced rate of 20% against the current rate   of 30 %. The income between ` 12.5 Lakh to ` 15 Lakh will be taxed at the   reduced rate of 25% against the existing rate of 30 %. Incomes   above ` 15 lakh will be continued to be taxed at the rate of 30 %. Those earning up to ` 5 lakhs shall not pay any tax either in the old   regime or in the new regime. The proposed tax structure will provide significant relief to   taxpayers and more so to those in the middle class.      Taxable Income        Existing Tax     New Tax Rates          Slab (`)             Rates        0-2.5 Lakh            Exempt             Exempt         2.5-5 Lakh               5%               5%         5-7.5 Lakh             20%               10%        7.5-10 Lakh             20%               15%        10-12.5 Lakh            30%               20%        12.5-15 Lakh            30%               25%       Above 15 Lakh            30%               30%                                    34    In the new tax regime, substantial tax benefit will accrue to a       taxpayer depending upon exemptions and deductions claimed by       him. For example, a person earning ` 15 lakh in a year and not       availing any deductions etc. will pay only `, 1,95,000 as compared       to `, 2,73,000 in the old regime. Thus his tax burden shall be       reduced by 78,000 in the new regime. He would still be the gainer       in the new regime even if he was taking deduction of ` 1.5 Lakh       under various sections of Chapter- VI-A of the Income Tax Act under       the old regime.    The new tax regime shall be optional for the taxpayers. An individual       who is currently availing more deductions & exemption under the       Income Tax Act may choose to avail them and continue to pay tax in       the old regime.    The new personal income tax rates will entail estimated revenue       forgone of ` 40,000 crore per year. We have also initiated measures       to prefill the income tax return so that an individual who opts for       the new regime would need no assistance from an expert to file his       return and pay income tax.    In order to simplify income tax system, I have reviewed all the       exemptions and deductions which got incorporated in the income tax       legislation over the past several decades. It was surprising to know       that currently more than one hundred exemptions and deductions of       different nature are provided in the Income-tax Act. I have removed       around 70 of them in the new simplified regime. We will review       and rationalise the remaining exemptions and deductions in the       coming years with a view to further simplifying the tax system and       lowering the tax rate.116.   Dividend Distribution Tax    Currently, companies are required to pay Dividend Distribution Tax       (DDT) on the dividend paid to its shareholders at the rate of 15%       plus applicable surcharge and cess in addition to the tax payable by       the company on its profits.    It has been argued that the system of levying DDT results in increase       in tax burden for investors and especially those who are liable to                                    35       pay tax less than the rate of DDT if the dividend income is included       in their income.    Further, non-availability of credit of DDT to most of the foreign       investors in their home country results in reduction of rate of return       on equity capital for them. In order to increase the attractiveness of       the Indian Equity Market and to provide relief to a large class of       investors, I propose to remove the DDT and adopt the classical       system of dividend taxation under which the companies would not       be required to pay DDT. The dividend shall be taxed only in the       hands of the recipients at their applicable rate.    Further, in order to remove the cascading effect, I also propose to       allow deduction for the dividend received by holding company from       its subsidiary. The removal of DDT will lead to estimated annual       revenue forgone of ` 25,000 Crore.      This is another bold move which will further make India an       attractive destination for investment.117.   Concessional tax rate for Electricity generation companies    In order to give boost to the manufacturing sector, new provisions       were introduced in September 2019 offering a concessional       corporate tax rate of 15% to the newly incorporated domestic       companies in the manufacturing sector which start manufacturing       by 31st March, 2023.    In order to attract investment in power sector, I propose to extend       the concessional corporate tax rate of 15% to new domestic       companies engaged in the generation of electricity.118.   Tax concession for foreign investments    In order to incentivise the investment by the Sovereign Wealth Fund       of foreign governments in the priority sectors, I propose to grant       100% tax exemption to their interest, dividend and capital gains       income in respect of investment made in infrastructure and other                                     36       notified sectors before 31st March, 2024 and with a minimum lock-       in period of 3 years.    In order to make available foreign funds at a lower cost, I propose to       extend the period of concessional withholding rate of 5% under       section 194LC for interest payment to non-residents in respect of       moneys borrowed and bonds issued up to 30th June, 2023.    I also propose to extend the period up to 30th June, 2023 for lower       rate of withholding of 5% under section 194LD for interest payment       to Foreign Portfolio Investors (FPIs) and Qualified Foreign Investors       (QFIs) in respect of bonds issued by Indian companies and       government securities.    I further propose to extend the concessional rate of withholding of       5% under section 194LD to the interest payment made on the       Municipal Bonds.    In order to incentivise listing of bonds at IFSC exchange, I propose to       further reduce the withholding rate from 5% to 4% on interest       payment on the bonds listed on its exchange.119.   Start-ups       Start-ups have emerged as engines of growth for our economy. Over       the past year, our Government has taken several measures to hand-       hold them and support their growth. During their formative years,       Start-ups generally use Employee Stock Option Plan (ESOP) to       attract and retain highly talented employees. ESOP is a significant       component of compensation for these employees. Currently, ESOPs       are taxable as perquisites at the time of exercise. This leads to cash-       flow problem for the employees who do not sell the shares       immediately and continue to hold the same for the long-term. In       order to give a boost to the start-up ecosystem, I propose to ease       the burden of taxation on the employees by deferring the tax       payment by five years or till they leave the company or when they       sell their shares, whichever is earliest.                                    37    Further, an eligible Start-up having turnover up to 25 crores is       allowed deduction of 100% of its the profits for three consecutive       assessment years out of seven years if the total turnover does not       exceed 25 crore rupees. In order to extend this benefit to larger       start-ups, I propose to increase the turnover limit from existing ` 25       crore to ` 100 crores. Moreover, considering the fact that in the       initial years, a start-up may not have adequate profit to avail this       deduction, I propose to extend the period of eligibility for claim of       deduction from the existing 7 years to 10 years.120.   Concessional tax rate for Co-operatives      Co-operative societies play an extremely important role in our       economy in facilitating access to credit, procurement of inputs and       marketing of products to their members. These cooperatives are       currently taxed at a rate of 30% with surcharge and cess. As a major       concession and in order to bring parity between the co-operative       societies and corporates, I propose to provide an option to       cooperative societies to be taxed at 22% plus 10% surcharge and 4%       cess with no exemption/deductions. Further, I also propose to       exempt these co-operative societies from Alternative Minimum Tax       (AMT) just like companies under the new tax regime are exempted       from the Minimum Alternate Tax (MAT).121.   Medium, Small and Micro Enterprises (MSME)    Currently, businesses having turnover of more than one crore       rupees are required to get their books of accounts audited by an       accountant. In order to reduce the compliance burden on small       retailers, traders, shopkeepers who comprise the MSME sector, I       propose to raise by five times the turnover threshold for audit from       the existing ` 1 crore to ` 5 crore. Further, in order to boost less       cash economy, I propose that the increased limit shall apply only to       those businesses which carry out less than 5% of their business       transactions in cash.122.   Affordable housing      For realisation of the goal of ‘Housing for All' and affordable       housing, in the last budget I had announced an additional deduction                                    38       of up to one lakh fifty thousand rupees for interest paid on loans       taken for purchase of an affordable house. The deduction was       allowed on housing loans sanctioned on or before 31st March, 2020.       In order to ensure that more persons avail this benefit and to further       incentivise the affordable housing, I propose to extend the date of       loan sanction for availing this additional deduction by one more       year.      Further, in order to boost the supply of affordable houses in the       country, a tax holiday is provided on the profits earned by       developers of affordable housing project approved by 31st March,       2020. In order to promote the affordable housing projects, I propose       to extend the date of approval of affordable housing projects for       availing this tax holiday by one more year.123.   Concession to real estate transactions    Currently, while taxing income from capital gains, business profits       and other sources in respect of transactions in real estate, if the       consideration value is less than circle rate by more than 5 percent,       the difference is counted as income both in the hands of the       purchaser and seller. In order to minimize hardship in real estate       transaction and provide relief to the sector, I propose to increase       the limit of 5% to 10%.124.   Charity institutions    Acknowledging the important role played by the charitable       institutions in the society, the income of these institutions is fully       exempt from taxation. Further, donation made to these institutions       is also allowed as deduction in computing the taxable income of the       donor.    Currently, a taxpayer is required to fill the complete details of the       donee in the income tax return for availing deduction.    In order to ease the process of claiming deduction for donation, it is       proposed to pre-fill the donee's information in taxpayer's return on       the basis of information of donations furnished by the donee. This                                      39       would result in hassle-free claim of deduction for the donation made       by the taxpayer.    Further, in order to claim the tax exemption, the charity institutions       have to be registered with the Income Tax Department. In the past,       the process of the registration was completely manual and scattered       all over the country.    In order to simplify the compliance for the new and existing charity       institutions, I propose to make the process of registration       completely electronic under which a unique registration number       (URN) shall be issued to all new and existing charity institutions.       Further, to facilitate the registration of the new charity institution       which is yet to start their charitable activities, I propose to allow       them provisional registration for three years.125.   Faceless appeals        Our government is committed to bringing in transformationalchanges so that maximum governance is provided with minimumgovernment. In order to impart greater efficiency, transparency andaccountability to the assessment process, a new faceless assessmentscheme has already been introduced. Currently, most of the functions ofthe Income Tax Department starting from the filing of return, processing ofreturns, issuance of refunds and assessment are performed in the electronicmode without any human interface. In order to take the reforms initiatedby the Department to the next level and to eliminate human interface, Ipropose to amend the Income Tax Act so as to enable Faceless appeal onthe lines of Faceless assessment.126.   No Dispute but Trust Scheme – ‘Vivad Se Vishwas'Scheme    Sir, in the past our Government has taken several measures to       reduce tax litigations. In the last budget, Sabka Vishwas Scheme was       brought in to reduce litigation in indirect taxes. It resulted in settling       over 1,89,000 cases. Currently, there are 4,83,000 direct tax cases       pending in various appellate forums i.e. Commissioner (Appeals),       ITAT, High Court and Supreme Court. This year, I propose to bring a       scheme similar to the indirect tax Sabka Vishwas for reducing       litigations even in the direct taxes.                                    40    Under the proposed ‘Vivad Se Vishwas' scheme, a taxpayer would       be required to pay only the amount of the disputed taxes and will       get complete waiver of interest and penalty provided he pays by 31st       March, 2020. Those who avail this scheme after 31st March, 2020       will have to pay some additional amount. The scheme will remain       open till 30th June, 2020.    Taxpayers in whose cases appeals are pending at any level can       benefit from this scheme.       I hope that taxpayers will make use of this opportunity to get relief       from vexatious litigation process.127.   Losses of merged banks    As a part of consolidation of the financial sector, our Government       has brought out schemes for merger and amalgamation of public       sector banks. In order to ensure that the amalgamated entities are       able to take the benefit of unabsorbed losses and depreciation of       the amalgamating entities, I propose to make necessary       amendments to the provisions of the Income-tax Act.128.   Taxpayer's Charter    Any tax system requires trust between taxpayers and the       administration. This will be possible only when taxpayer's rights are       clearly enumerated. Towards this end, and with the objective of       enhancing the efficiency of the delivery system of the Income Tax       Department, I propose to amend the provisions of the Income Tax       Act to mandate the Central Board of Direct Taxes (CBDT) to adopt a       Taxpayers' Charter. The details of the contents of the charter shall       be notified soon.129.   Instant PAN through Aadhaar      In the last Budget, I had introduced the interchangeability of PAN       and Aadhaar for which necessary rules were already notified. In       order to further ease the process of allotment of PAN, soon we will       launch a system under which PAN shall be instantly allotted online       on the basis of Aadhaar without any requirement for filling up of       detailed application form.                                     41130. Our Government brought in the GST as a historic reform of theindirect taxes in 2017. We also took a path-breaking step of simplifying andrationalising corporate tax in September, 2019. More importantly, weoffered a rate of corporate tax, which perhaps is the lowest in the world.Continuing on this path, we have now put the personal income tax at itslowest ever rate and totally removed DDT at the company's hands. Further,the direct taxes are now the lowest, simplest, and smoothest. Direct tax onthe Start-ups also has seen many reformatory steps in quick succession.Even ease of compliance is seeing unprecedented changes. Last but not theleast, personal interface with tax administration is at the minimum ever.Indirect Tax131. As I mentioned earlier in Part A of my speech, reforms arecontinuing in GST. A simplified return shall be implemented from the 1stApril, 2020. This is under pilot run. It will make return filing simple withfeatures like SMS based filing for nil return, return pre-filling, improvedinput tax credit flow and overall simplification.132. Refund process has been simplified and has been made fullyautomated with no human interface.133. Electronic invoice is another innovation wherein critical informationshall be captured electronically in a centralized system. It will beimplemented in a phased manner starting from this month itself on optionalbasis. It will facilitate compliance and return filing.134. Several measures have been taken for improving compliance.Aadhaar based verification of taxpayers is being introduced. This will help inweeding out dummy or non-existent units. Dynamic QR-code is proposedfor consumer invoices. GST parameters will be captured when payment forpurchases is made through the QR-code. A system of cash reward isenvisaged to incentivise customers to seek invoice. Deep data analytics andAI tools are being used for crackdown on GST input tax credit, refund, andother frauds and to identify all those who are trying to game the system.Invoice and input tax credit matching is being done wherein returns havingmismatch more than 10 percent or above a threshold are identified andpursued. Significant policy level changes have also been made. GST ratestructure is also being deliberated so as to address issues like inverted dutystructure.                                    42135. On Customs side, a number of measures have been taken for ease ofdoing business. India's quantum leap in the Trading Across Borderparameter of Ease of Doing Business rankings by the World Bank is atestimony to these efforts. India's rank on this parameter improved from146 to 80 in 2018 and further to 68 in 2019. Measures have also beentaken for providing a level playing field to our domestic manufacturers,particularly the MSME sector and for securing borders.136. It has been observed that imports under Free Trade Agreements(FTAs) are on the rise. Undue claims of FTA benefits have posed threat todomestic industry. Such imports require stringent checks. In this context,suitable provisions are being incorporated in the Customs Act. In thecoming months we shall review Rules of Origin requirements, particularlyfor certain sensitive items, so as ensure that FTAs are aligned to theconscious direction of our policy.137. We are also strengthening provisions relating to safeguard dutieswhich are applied when surge in imports causes serious injury to domesticindustry. Amended provisions shall enable regulating such surge in importsin a systematic way. The provisions for checking dumping of goods andimports of subsidized goods are also being strengthened for ensuring a levelplaying field for domestic industry. These changes are in line with theinternational best practices.138. Exemptions from customs duty have been given in public interestfrom time to time. However, a number of these have outlived their utility orhave become outdated. On review, certain such exemptions are beingwithdrawn. Remaining custom duty exemptions shall be comprehensivelyreviewed by September, 2020 for taking a view on their relevance. Ipropose to crowd source suggestions for such reviews. Suggestions wouldalso be invited in respect of the Customs laws and procedures for aligningthem with the needs of changing times and ease of doing business.139. Labour intensive sectors in MSME are critical for employmentgeneration. Cheap and low-quality imports are an impediment to theirgrowth. Special attention has been taken to put measured restraint onimport of those items which are being produced by our MSMEs with betterquality. Keeping in view the need of this sector, customs duty is beingraised on items like footwear and furniture.140. Our policy of Make in India has started giving dividends. India is nowmaking world class goods and exporting such products. We have madeconsiderable progress in medical equipment too. Till few years back we                                        43were dependent on imports for medical equipment. Now, not only we aremanufacturing medical equipment but also exporting them in largequantities. This sector deserves further fillip. Government has also beencommitted to provide health services to all. Ayushman Bharat has made itpossible. To achieve the twin objectives of giving impetus to the domesticindustry and also to generate resource for health services, I propose toimpose a nominal health cess, by way of a duty of customs, on the importsof medical equipment keeping in view that these goods are now beingmade significantly in India. The proceed from this cess shall be used forcreating infrastructure for health services in the aspirational districts.141. Under Make in India initiative, well laid out customs duty rates werepre-announced for items like mobile phones, electric vehicles and theircomponents. This has ensured gradual increase in domestic value additioncapacity in India. Customs duty rates are being revised on electric vehicles,and parts of mobiles as part of such carefully conceived PhasedManufacturing Plans.142. In other changes, customs duty is being reduced on certain inputsand raw materials while it is being revised upward on certain goods whichare being made domestically. In the previous budget, basic custom duty of10% was imposed on the news print and lightweight coated paper.However, since then I have received several references that this levy hasput additional burden on print media at a time when it is going through adifficult phase. I, therefore, propose to reduce basic customs duty onimports of news print and light-weight coated paper from 10% to 5%.143. Chemicals are crucial feed stocks for downstream users. PTA, forexample, is a critical input for textile fibres and yarns. Its easy availability atcompetitive prices is desirable to unlock immense potential in textile sectorwhich is a significant employment generator. Therefore, in the largerpublic interest, anti-dumping duty on PTA is being abolished.144. As a revenue measure, I propose to raise excise duty, by way ofNational Calamity Contingent Duty on Cigarettes and other tobaccoproducts. However, no change is being made in the duty rates of bidis.145. Finally, continuing the tax reform is an ongoing challenge and wepropose to pursue them with full vigour.146. Details of my budget proposals relating to direct and indirect taxesare in the Annexure to my speech.147. Mr. Speaker Sir, with these words I commend the Budget to thisaugust House.                                           44                                                                           Annex-I                           Budget Outlay for Major Sectors                                                                        (` crore)Sl.                Sector Name                     BE 19-20     RE 19-20    BE 20-21No. I    Aspirational India                        4,67,517     4,36,913     4,82,401 a    Agriculture & Allied, Irrigation &        2,76,380     2,49,910     2,83,202      Rural Developmentb     Wellness, Water, Sanitation                93,294       89,618        96,885 c    Education & Skill Development              97,843       97,385      1,02,314II    Economic Development                      2,23,695     2,24,941     2,37,604 a    Industry & Commerce                        27,043       28,608        27,227b     Transport Infrastructure                  1,57,437     1,58,207     1,69,637 c    Energy                                     39,215       38,127        40,740III   New Economy                                40,534       34,724        42,852 a    Information Technology & Space             19,127       18,979        20,379      Technologyb     Communication (Bharat Net)                  8,350        3,000         8,000 c    Science & Technology                       13,056       12,745        14,473IV    Caring Society                             59,036       54,831        62,626 a    Women & Child Development                  50,850       48,210        53,876      and Social welfareb     Culture & Tourism                           5,232        3,963         5,650 c    Environment & Climate Change                2,955        2,658         3,100V     Financial Sector                           19,002       23,686        40,433 a    Banking, Insurance, Financial              19,002       23,686        40,433      Market and Infra Finance                                           45                                                                               Annex – II                                 Major Scheme Allocation                                                                                (` crore) S.              Name of the Scheme                  BE            RE          BENo.                                                2019-20       2019-20     2020-211     National Social Assistance Progam                9,200         9,200       9,1972     Mahatma Gandhi National Rural                   60,000       71,002       61,500      Employment Guarantee Program3     Umbrella Scheme for Development of               5,445         5,568       6,242      Schedule Castes4     Umbrella Programme for Development of            3,810         4,194       4,191      Scheduled Tribes5     Umbrella Programme for Development of            1,590         1,709       1,820      Minorities6     Umbrella Programme for Development of            1,818         1,846       2,210      Other Vulnerable Groups7     National Ganga Plan                                  750        353          8009     Pradhan Mantri Gram Sadak Yojna                 19,000       14,070       19,50010    Pradhan Mantri Awas Yojna (PMAY)                25,853       25,328       27,50011    Jal Jeevan Mission (JJM)                        10,001       10,001       11,50012    Swachh Bharat Mission                           12,644         9,638      12,29413    National Health Mission                         33,651       34,290       34,11514    National Education Mission- Samgra              38,547       37,672       39,161      Shiksha15    PMJAY-Ayushman Bharat                            6,556         3,314       6,42916    Pradhan Mantri Kisan Samman Nidhi (PM-          75,000       54,370       75,000      KISAN)17    Deen Dayal Antyodaya Yojana- National            9,774         9,774      10,005      Livelihood Mission - Ajeevika18    Pardhan Mantri Swasthya Suraksha Yojana          4,000         4,733       6,02019    Umbrella Integrated Child development           27,584       24,955       28,557      Scheme20    National Programme of Mid Day Meal in           11,000         9,912      11,000      Schools                                             46                                                                                     Annex – III          Transfer of Resources to States and Union Territories with Legislature                                                                                       (` crore)                                                    BE           RE               BE                                                  2019-20      2019-20         2020-21I. Devolution of States share in taxes             8,09,133      6,56,046        7,84,181II. Some Important Items of Transfer                 54,581        57,344          73,2751. Assistance to States from NDRF                    10,000        20,000          25,0002. Central Pool of Resources for North                  392           380             407Eastern Region and Sikkim3. Externally Added Projects - Grants                4,500           3,000            4,0004. Externally Aided Projects-Loan                   19,723          25,000           25,0005. Schemes of North East Council                       326             324              2876. Schemes under Provision to Article 275(1)         2,321           2,321            1,199of the Constitution7. Special Assistance under the demand -            15,000           4,000           15,000Transfers to States8. Special Central Assistance to Scheduled           1,074           1,074            1,172Castes under Demand- Department of SocialJustice and Empowerment9. Special Central Assistnace to Tribal Area         1,245           1,245            1,210under the Demand - Ministry of Tribal AffairsIII. Finance Commission Grants                     1,20,466       1,23,710          1,49,9251. Grant for local bodies - Rural Bodies             52,558         58,616            69,9252. Grants for Urban Local Bodies                     23,359         25,843            30,0003. Grants-in-Aid for SDRF                            10,344         10,938            20,0004. Post Devolution Revenue Deficit Grants            34,206         28,314            30,000IV. Total Transfer to States [Other than           3,35,220       3,22,443          3,35,878(I)+(II)+(III)]1. Under Centrally Sponsored Schemes               2,92,003       2,83,057          2,95,269(Revenue)2. Under Central Sector Schemes (Revenue)           42,076          38,227           39,4513. Under Other Categories of Expenditure             1,033           1,055            1,066(Revenue)4. Capital Transfers                                   109             104               93V. Total Transfer to Delhi and Puducherry           10,028          28,419           47,4081. Under Centrally Sponsored Schemes                 2,026           1,999            5,603(Revenue)2. Under Central Sector Schemes (Revenue)               89             222              2993. Under Other Categories of Expenditure             7,613          25,972           41,355(Revenue)4. Capital Transfers                                    300            225               150Total Transfer to States/UTs                      13,29,428      11,87,961         13,90,666                                              47                                                                                    Annex – IV                         Allocation for Major Ministries/ Departments                                                                                      (` crore)Sl.             Ministry/Department                   BE             RE              BENo.                                                 2019-20        2019-20         2020-211     Department of Agriculture, Cooperation          1,30,485          1,01,904     1,34,400      and Farmers' Welfare2     Department of Agricultural Research and            8,079            7,846         8,363      Education3     Atomic Energy                                     16,926           17,426        18,2294     Ministry of Ayurveda, Yoga and                     1,940            1,857         2,122      Naturopathy, Unani, Siddha and      Homoeopathy (AYUSH)5     Department of Fertilisers                         80,035           80,035        71,3456     Ministry of Civil Aviation                         4,500            3,700         3,7987     Department of Commerce                             6,219            7,219         6,2198     Department for Promotion of Industry and           5,675            6,490         6,606      Internal Trade9     Department of Posts                               11,299            12,398       15,52510    Department of Telecommunications                  27,338            23,350       66,43211    Department of Consumer Affairs                     2,272             2,050        2,30012    Department of Food and Public Distribution      1,92,240          1,15,240     1,22,23513    Ministry of Culture                                3,042             2,547        3,15014    Defence Services (Revenue)                      2,01,902          2,05,902     2,09,31915    Capital Outlay on Defence Services              1,03,394          1,10,394     1,13,73416    Defence Pensions                                1,12,080          1,17,810     1,33,82517    Ministry of Development of North Eastern           3,000            2,670         3,049      Region18    Ministry of Earth Sciences                         1,902            1,810         2,07019    Ministry of Electronics and Information            6,654            5,839         6,899      Technology20    Ministry of Environment, Forests and               2,955            2,658         3,100      Climate Change21    Ministry of External Affairs                      17,885            17,372       17,34722    Department of Economic Affairs                    14,312            15,952       29,30823    Department of Financial Services                   4,690             7,734       11,12524    Department of Revenue                           1,02,048          1,22,066     1,36,64025    Interest Payments                               6,60,471          6,25,105     7,08,20326    Pensions                                          48,565            50,565       61,16927    Transfers to States                             1,55,447          1,55,447     2,00,44728    Department of Fisheries                              805               700          82529    Department of Animal Husbandry and                 2,932             2,790        3,289      Dairying30    Ministry of Food Processing Industries             1,197            1,043         1,23331    Department of Health and Family Welfare           62,659           62,659        65,01232    Department of Health Research                      1,900            1,950         2,100                                             48Sl.             Ministry/Department                 BE            RE            BENo.                                               2019-20       2019-20       2020-2133    Ministry of Home Affairs                        4,896        19,955         8,00234    Ladakh                                              ...           ...       5,95835    Transfers to Jammu and Kashmir                      ...           ...      30,75736    Ministry of Housing and Urban Affairs          48,032        42,267        50,04037    Department of School Education and             56,537        56,537        59,845      Literacy38    Department of Higher Education                 38,317        38,317        39,46739    Ministry of Information and Broadcasting        4,375         4,065         4,37540    Department of Water Resources, River            8,245         7,518         8,960      Development and Ganga Rejuvenation41    Department of Drinking Water and               20,016        18,360        21,518      Sanitation42    Ministry of Labour and Employment              11,184        11,184        12,06543    Ministry of Micro, Small and Medium             7,011         7,011         7,572      Enterprises44    Ministry of Minority Affairs                     4,700         4,700         5,02945    Ministry of New and Renewable Energy             5,255         3,892         5,75346    Ministry of Panchayati Raj                         871           500           90147    Ministry of Petroleum and Natural Gas           42,901        42,901        42,90148    Ministry of Power                               15,875        15,875        15,87549    Ministry of Railways                            68,019        69,967        72,21650    Ministry of Road Transport and Highways         83,016        83,016        91,82351    Department of Rural Development               1,17,647      1,22,649      1,20,14752    Department of Land Resources                     2,227         1,900         2,25153    Department of Science and Technology             5,580         5,481         6,30254    Department of Biotechnology                      2,580         2,381         2,78755    Department of Scientific and Industrial          4,896         4,883         5,385      Research56    Ministry of Shipping                            1,903         1,523         1,80057    Ministry of Skill Development and               2,989         2,531         3,002      Entrepreneurship58    Department of Social Justice and                8,885         8,885        10,104      Empowerment59    Department of Empowerment of Persons            1,205         1,100         1,325      with Disabilities60    Department of Space                            12,473        13,139        13,47961    Ministry of Statistics and Programme            5,231         5,231         5,444      Implementation62    Ministry of Textiles                            4,831         4,831         3,51563    Ministry of Tourism                             2,189         1,416         2,50064    Ministry of Tribal Affairs                      6,895         7,340         7,41165    Ministry of Women and Child Development        29,165        26,185        30,00766    Ministry of Youth Affairs and Sports            2,217         2,777         2,827                                                                    49                                                                                                                          Annex-V   Statement of Extra Budgetary & Other Resources (Govt. fully serviced bonds, NSSF etc.)                                                                                                                                (` crore) Part-A – EBRs mobilised through issue of Govt. fully serviced bondsDemand          Name of the Ministry/Department and Name of                            BE                   RE                 BE  No.                            the Scheme                                          2019-20              2019-20            2020-21       42       Department of Health & Family Welfare                Pradhan Mantri Swasthya Suraksha Yojana                                 5,000.00            2,700.00           3,000.00       57       Ministry of Housing & Urban Affairs                Pradhan Mantri Awas Yojana (PMAY) - Urban                              20,000.00          10,000.00           10,000.00       59       Department of Higher Education                Revitalising Infrastructure and Systems in                              5,000.00            1,000.00           3,000.00                Higher Education (RISE)       61       Department of Water Resources, River                Development & Ganga Rejuvenation                (i) Polavaram Irrigation Project                                              ---           1,850.00                (ii) Pradhan Mantri Krishi Sinchai Yojana (AIBP &                       4,882.00            3,033.96           5,000.00                     other Projects)       62       Department of Drinking Water & Sanitation                (i) Swachh Bharat Mission (Rural)                                       5,000.00            5,000.00                (ii) Jal Jeevan Mission/National Rural Drinking                         6,300.00            2,000.00          12,000.00                     Water Programme       70       Ministry of New & Renewable Energy                Pradhan Mantri-Kisan Urja Sanrakshan Evam                Utthan Mahabhiyan (PM-KUSUM)                                               822.00             500.00           1,000.00       77       Ministry of Power                Deen Dayal Upadhyaya Gram Jyoti                Yojana/SAUBHAGYA                                                        9,000.00            8,500.00           5,500.00       85       Department of Rural Development                Pradhan Mantri Awas Yojana (PMAY) - Rural                                        ---      10,000.00           10,000.00       90       Ministry of Shipping                Inland Waterways Authority of India (IWAI)                              1,000.00                    ---                 ---                Projects                                                              Total                    57,004.00          44,583.96           49,500.00 Part-B – Financial support extended through loans from NSSF Sl.                Name of the Ministry/Department/                                   BE                   RE                 BENo.                        Name of the Entity                                        2019-20              2019-20            2020-21   1        Department of Food & Public Distribution             Food Corporation of India                                                           ---    1,10,000.00         1,36,600.00  2.        Ministry of Housing & Urban Affairs            Building Materials & Technology Promotion                                           ----      15,000.00                    ---            Council(BMTPC)  3.        Department of Fertilizers            (i) Rashtriya Chemicals & Fertilizers Ltd.                                           ---       1,805.00                  ---            (ii) Metals & Minerals Trading Corporation                                           ---       1,310.00                  ---                                                                       Total                     ---    1,28,115.00         1,36,600.00                                                      Grand Total (A+B)                57,004.00        1,72,698.96         1,86,100.00Notes:(i)         Estimates of financial support through NSSF as indicated in RE 2019-20 & BE 2020-21 is arrived on the basis of gap betweentotal requirement for funds (including repayment of NSSF loan in FY 2019-20 & FY 2020-21), proposed by Department of Food & PublicDistribution during these years and budgetary provision made in RE 2019-20 & BE 2020-21.(ii)        Capital Infusion in Public Sector Banks: Capital to the extent of `80,000 crore in 2017-18 and ` 1,06,000 crore in 2018-19 wasinfused for Recapitalization of Public Sector Banks to enable them to maintain their Regulatory Capital, Growth Capital and PromptCorrective Action (PCA) at desirable levels. For this purpose, a provision of ` 70,000 crore has also been made available in the 2019-20.Currently, the capital infusion is made through issuance of GoI special Securities carrying a fixed coupon. In the current Financial Year, sofar `64,612 crore has been infused as Government's fresh capital.(iii)       Statement of liability on annuity projects is given in Part-B of the Receipt Budget 2020-21.                                         50                                              Annex to Part B of Budget Speech                                Direct Tax Proposals:1.       Tax Incentives1.1      Relief in personal income-tax and simplification of taxation: In order         to provide relief and simplify the taxation regime, it is proposed to         provide an option to individual and Hindu undivided family to be         taxed at following lower rates if they do not avail specified         exemption/deductions:                          Total Income (Rs)                    Rate (%)             Upto 2,50,000                                        Nil             From 2,50,001 to 5,00,000                            5             From 5,00,001 to 7,50,000                            10             From 7,50,001 to 10,00,000                           15             From 10,00,001 to 12,50,000                          20             From 12,50,001 to 15,00,000                          25             Above 15,00,000                                      30         Surcharge and cess shall be continued to be levied at the existingrates.1.2      Relief and simplification for co-operative societies: In order to provide         relief and simplify the taxation regime, it is proposed to provide an         option to cooperative societies to be taxed at 22% plus 10% surcharge         plus 4% cess, if they do not avail certain specified         deduction/exemption. Further, it is also proposed to exempt these         cooperative societies from Alternative Minimum Tax (AMT).1.3      Tax concession for foreign investments: In order to promote         investment of sovereign wealth fund, including the wholly owned         subsidiary of Abu Dhabi Investment Authority (ADIA),it is proposed to                                      51      grant tax exemption to interest, dividend and capital gains income of      Sovereign Wealth Fund and wholly owned subsidiary of the ADIA      subject to fulfilment of certain conditions, in respect of investment      made in the infrastructure sector or other deserving notified sectors      before 31st March, 2024 and with a minimum lock-in period of 3 years.1.4   Removal of Dividend Distribution Tax: At present dividend is taxed in      the hands of company distributing such dividend. This is found to be      iniquitous. It is proposed to shift to classical system of taxing dividend      in the hands of shareholders.1.5   Incentives for IFSC, municipal bonds and offshore borrowing: The      concessional rate of Tax Deductible at Source (TDS) at five per cent      currently available under section 194LC and 194LD for borrowing from      overseas is proposed to be extended for three years to 30th June      2023. Further, specified municipal bonds would also be eligible for      such concession on overseas borrowing. It is also proposed to provide      that the withholding tax rate shall be four per cent on fresh overseas      borrowing on or after the 1st day of April, 2020 but before the 1st day      of July, 2023 which is listed only on a recognised stock exchange      located in any IFSC.1.6   Incentives to Affordable Housing: Currently, an additional deduction      up to one lakh fifty thousand rupees is allowed for interest paid on      loans sanctioned upto 31st March, 2020 for purchase of an affordable      house. In order to incentivise the purchase of affordable housing, it is      proposed to extend the date of sanction of loan to 31st March, 2021.      Hence, this deduction will also be available in respect of housing loans      sanctioned by 31st March, 2021.      Further, in order to boost the supply of affordable houses in the      country, a tax holiday is provided on the profits earned by developers      of affordable housing project approved by 31st March, 2020. In order      to promote the affordable housing projects, it is proposed to extend      the date of approval of affordable housing projects for availing this tax      holiday by one more year. Accordingly, developers of affordable      housing projects approved by 31st March, 2021 can also avail of the      tax holiday.1.7   Concession to Real Estate sector: Currently, safe harbour of 5% is      allowed for computation of income in respect of transaction of                                      52      immovable property where the consideration is less than the circle      rate. In order to boost housing sector, it is proposed to increase this      safe harbour to 10%.1.8   Incentives to start-up: In order to encourage the start-ups to employ      highly talented employees at a relatively low salary by granting them      Employee Stock Option Plan (ESOPs), it is proposed to defer the tax      payment on these ESOPs granted by start-up to their employees by      five years or till the employee leaves the company or when the said      employee sells those shares, whichever is earliest.      Further, in order to extend benefit of tax holiday to larger start-ups, it      is proposed to increase the turnover threshold for claiming tax holiday      from existing Rs. 25 crore to Rs. 100 crores. Further, in order to      address the concerns of start-ups which may not have adequate profit      in initial years for availing this holiday, it is proposed to extend the      period of eligibility for claim of 100% deduction from the existing 7      years to 10 years.1.9   Allowing carry forward of losses or depreciation in certain      amalgamations: It is proposed to provide that the amalgamated public      sector banks and insurance companies shall be eligible to take the      benefit of unabsorbed losses and depreciation of the amalgamating      entities.1.10 Widening the definition of “business trust”: In order to encourage     unlisted Infrastructure Investment Trust (InvIT) or a Real Estate     Investment Trust (REIT), it is proposed to extend the same taxation     regime as available to listed InvITs and listed REIT to unlisted REIT and     InvIT.1.11Exemption to Indian Strategic Petroleum Reserves Limited: It is     proposed to provide exemption to Indian Strategic Petroleum     Reserves Limited (ISPRL) in respect of income accruing or arising as a     result of an arrangement for replenishment of crude oil stored in its     storage facility in pursuance to directions of the Central Government     in this behalf subject to the condition of replenishment of crude oil     within three years.                                     531.12 Concessional tax rate for electricity generation companies: In order to     attract investment in the power sector, it is proposed to extend the     concessional corporate tax rate of 15% provided by the Taxation Laws     (Amendment) Act, 2019 to new domestic companies that are engaged     in the generation of electricity subject to the condition that they start     generating electricity by 31st March, 2023.2.    Measures to provide tax certainty2.1   Widening the scope of Safe Harbour Rules and Advance Pricing      Agreement: In order to provide tax certainty to taxpayers in the      matter of attribution of profit to permanent establishment (PE), it is      proposed to widen the scope of Advanced Pricing Agreement (APA)      and Safe Harbour Regime (SHR), by providing that determination of      attribution of profit to PE shall also be in the scope of SHR and APA.2.2   Rationalisation of deduction to insurance companies: It is proposed to      provide that expenses disallowed in the hands of insurance companies      for late payment of statutory dues shall be allowed in the year of      payment.2.3 Reduction in rate of Tax Deduction at Source (TDS): In order to reduce     litigation, it is proposed to reduce rate for TDS in case of fees for     technical services (other than professional services) to two per cent     from existing ten per cent in order to align the same with the rate of     TDS on works contract.2.4   Vivad se Vishwas Scheme: It is proposed to bring out a scheme for      reducing the direct tax litigation. Taxpayers in whose case appeals are      pending at any level can take the benefit from this scheme. Under the      scheme, taxpayer would be required to pay only the amount of the      disputed taxes and there will be complete waiver of interest and      penalty provided they make payment by 31st March, 2020. For      disputed penalty, interest and fee not connected with the disputed      tax, the taxpayer would be required to pay only 25% of the same for      settling the dispute. A tax payer shall be required to pay 110% of the      disputed tax (the excess 10% shall be limited to the amount of related      penalty and interest, if any) and 30% of penalty, interest and fee in      case of payment after 31st March, 2020.                                      543.    WIDENING AND DEEPENING OF TAX BASE3.1   TDS on E-commerce transactions: In order to widen and deepen the      tax net, it is proposed to provide that e-commerce operator shall      deduct TDS on all payments or credits to e-commerce participants at      the rate of 1% in PAN/Aadhaar cases and 5% in non-PAN/Aadhaar      cases. In order to provide relief to small businessman, it is proposed      to provide exemption to an individual and HUF who receives less than      Rs. 5 lakh and furnishes PAN/Aadhaar.3.2   Enlarging the scope of TDS on interest: It is proposed to extend the      TDS on interest paid by certain large co-operative societies whose      gross receipts exceeds fifty crore rupees during the last financial year.3.3   Widening the scope of TCS: It is proposed to provide for tax collection      at source (TCS) on remittance under Liberalised Remittance Scheme      of Reserve Bank of India exceeding seven lakh rupees in a year and on      sale of overseas tour package. Further, TCS is also proposed on sale of      goods in excess of fifty lakh rupee in a year by a seller whose turnover      is more than 10 crore rupees.3.4   Limit on exemption of Employer's contribution to certain funds: It is      proposed to put an upper cap of seven lakh and fifty thousand rupees      in a year on tax exempt employer's contribution in recognized      provident fund, superannuation fund and NPS in the accounts of an      employee.4.    IMPROVING EFFECTIVENESS OF TAX ADMINISTRATION4.1   Faceless appeal: In order to impart greater efficiency, transparency      and accountability to the assessment process, a new faceless      assessment scheme has already been introduced. In order to ensure      that the reforms initiated by the Income Tax Department to eliminate      human interface from the system reach the next level, it is proposed      to provide enabling power for launching of Faceless appeal on the      lines of Faceless assessment.4.2   Widening the scope of Dispute Resolution Panel(DRP): It is proposed      to widen the scope of references to DRP by including all non-residents                                      55      as eligible assessee and to clarify that all variation which are      prejudicial to the assessee shall be within the scope of DRP.4.3   Taxpayer's Charter: With the objective of enhancing the efficiency of      the delivery system of the Income Tax Department, it is proposed to      provide that the CBDT shall adopt a Taxpayer's Charter and issue      necessary direction for the implementation of the Charter.4.4   Modification in the scope of faceless assessment: It is proposed to      widen the scope of faceless assessment scheme to cover those cases      in which assessment is being completed ex-parte.5.    EASE OF COMPLIANCE5.1   Raising of limit for tax audit: In order to help small and medium      enterprises, it is proposed to raise the turnover threshold for      compulsory tax audit from existing Rs. 1 crore to Rs. 5 crore in a case      where cash receipt is not more than 5% of total receipt and cash      payment is not more than 5% of total payment. Further, in order to      reduce the compliance cost, it is also proposed to provide that tax      audit report to be filed a month before the due date of filing income-      tax return. Accordingly, the said due date for filing of income-tax      returns is proposed to be changed from 30th September to 31st      October of the relevant assessment year so that there is no change in      the date of finalisation of tax audit.5.2   Exempting non-resident from filing of Income-tax return on certain      conditions: In order to reduce compliance burden of non-residents, it      is proposed to exempt them from filing income-tax return on their      income of the nature of royalty or fee for technical services, if tax has      been deducted at the rate given in section 115A.6.    RATIONALISATION OF PROVISIONS OF THE INCOME-TAX ACT, 19616.1   It is proposed to withdraw the exemption on certain perquisites and      allowances provided to Chairman and members of Union Public      Service Commission and to Chief Election Commissioner and Election      Commissioners.                                      566.2   It is proposed to rationalise the definition of ‘taxable commodities      transactions' for the purposes of levy of Commodity Transaction Tax.6.3   It is proposed to enable the Central Government for notifying scheme      for levying penalty in a faceless manner.6.4   To increase transparency in survey operation, it is proposed to      provide that if the survey is not based on information provided by      prescribed authority, then approval of Commissioner or Principal      Commissioner of Income-tax is required.6.5   It is proposed to provide that Income Tax Appellate Tribunal can grant      stay of demand only if the taxpayer has either paid twenty per cent of      amount of demand or have provided security for an equal amount.6.6   It is proposed to reduce the time of stay in India from 182 days to 120      days for an Indian citizen or person of Indian origin to become      resident in India. Consequently, it is proposed to relax the provision of      “resident but not ordinarily resident” so that a resident who has been      non-resident in seven out of ten previous years would be resident but      not ordinarily resident. It is also proposed to provide that an Indian      citizen who is not liable to tax anywhere would be deemed to be      resident in India.6.7   It is proposed to amend the definition of “work” for the purpose of      TDS under section 194C to provide that in a contract manufacturing,      the raw material provided by the assessee or its associate shall fall      within the purview of the ‘work' under section 194C.6.8   To discourage taxpayers to manipulate their books of accounts by      recording false entries including fake invoices to claim wrong input      credit in GST, it is proposed to provide for penalty for these      malpractices.6.9   It is proposed to amend the provision allowing India to enter into      Double Taxation Avoidance Agreements (DTAA) with other countries      or territories or association, to align with the new preamble      mandated by Multilateral Convention to Implement Tax Treaty      Related Measures to Prevent Base Erosion and Profit Shifting      (commonly referred to as MLI), as India has already ratified MLI.                                      576.10 It is proposed to defer the enactment of Significant Economic     Presence (SEP) to Financial Year 2021-22 as G-20 OECD report on     digital economy is expected by that time. It is also proposed to     provide for source rule for revenue from advertisement targeted to     India customers and revenue from sale of Indian sourced data.6.11 It is proposed to align exemption from the provision of indirect     transfer to Foreign Portfolio Investors in line with new SEBI FPI     regulations. It is also proposed to rationalise the definition of royalty.6.12 It is proposed to rationalise the provisions of section 115BAA and     section 115BAB to provide that any domestic company (both existing     as well as new) opting for concessional tax regime will not be allowed     to claim any deduction under Chapter VI-A of the Act except     deductions specifically allowed under said sections.6.13 The conditions for setting up of offshore fund are proposed to be     rationalised so as to facilitate setting up of fund management activity     in India.6.14 It is proposed to clarify that in case of a capital asset, being land or     building or both, the fair market value of such an asset on 1st day of     April, 2001 shall not exceed the stamp duty value of such asset as on     1st day of April, 2001, where such stamp duty value is available.6.15 It is proposed to rationalise the process of registration in the case of     trusts, institutions, funds, university, hospital etc. and approval in the     case of association, university, college, institution or company etc. It is     also proposed to provide filing of statement of donation by donee so     that the deduction claimed by the donor in its tax return can be pre-     filled.6.16 It is proposed to rationalise the provision regarding uploading of     Form 26AS so as to include all the prescribed information.6.17 It is proposed to rationalise the provisions relating to cost of     acquisition and period of holding with respect to segregated portfolios     to provide clarity to taxpayers holding such portfolios.                                     586.18 It is proposed to authorise Board to prescribe person who can verify     the return of income in the cases of a company and a limited liability     partnership. It is also proposed to authorise Board to prescribe person     who can appear as an authorised representatives. This will help     companies under Insolvency proceedings and in liquidation. It is also     proposed to align the due date of Partner and Firm.6.19 In order to facilitate opting for new concessional tax regime by the     domestic companies, it is proposed to rationalise the provisions of     section 35AD so as to provide an option for claiming deduction under     section 35AD.6.20 In order to rationalise the provisions of section 94B, it is proposed to     exclude payment of interest to a branch of non-resident bank in India     from interest deductibility rule under section 94B.                                       59                                             Annex to Part B of Budget Speech                             Indirect Tax Proposals:A.        Legislative Changes in Customs:     1.   Major Amendments in the Customs Act, 1962:            S.                                     Amendment           No.             A For improving compliance             1. A new Chapter VAA (a new section 28DA) is being                incorporated in the Customs Act to provide enabling                provision for administering the preferential tariff treatment                regime under Trade Agreements. The proposed new                section seeks to specifically provide for certain obligations                on importer and prescribe for time bound verification from                exporting country in case of doubt. Pending verification                preferential tariff treatment shall be suspended and goods                shall be cleared only on furnishing security equal to                differential duty. In certain cases, the preferential tariff                treatment may be denied without further verification.            B    For reducing litigation            1.   An explanation is being inserted in section 28 to explicitly                 clarify that any notice issued under the said section, prior                 to the enactment of the Finance Act, 2018, shall continue                 to be governed by the section 28 as it existed before the                 said enactment, notwithstanding order of any Appellate                 Tribunal, Court or any other law to the contrary.            C    Other enabling provisions            1.   Clause (f) of the section 11(2) empowers the Central                 Government, for prevention of injury to the economy of                 the country by the uncontrolled import or export of gold or                 silver, to prohibit their import or export. This clause is                 being amended to include “any other goods” (in addition to                 gold and silver) in its ambit.            2.   A new section (section 51B) is being incorporated to                 provide for creation of an Electronic Duty Credit Ledger in                                   60            the customs system. This will enable duty credit in lieu of            duty remission to be given in respect of exports or other            such benefit in electronic form for its usage, transfer etc. In            this regard, enabling provisions for issuance of suitable            regulations are also being inserted in section 157(2) of the            Customs Act,1962.            The provisions for recovery of duties provided under            section 28AAA of Customs Act, 1962 are also being            expanded to include such electronic credit of duties.2.   Amendments to the Customs Tariff Act, 1975:       S.                                    Amendment      No.       A    Amendment in the Customs Tariff Act, 1975            Section 8B of the Customs Tariff Act, 1975, which provided            for imposition of safeguard duty as a trade remedy against            surge in imports of a commodity, is being amended to make            provisions for application of other safeguard measures such       1.            as Tariff Rate Quota and other safeguard measure as the            Central Government may deem necessary to protect the            domestic industry from injury due to significant surge in            imports.            Amendment in the First Schedule of the Customs Tariff       B            Act, 1975            First Schedule to the Customs Tariff Act, 1975 is being            amended to:            (i) Create new tariff item 8414 51 50 for “Wall fans”. The                  tariff rate for this item is 20% and BCD on wall fans is                  being increased from 7.5% to 20%            (ii) Create new tariff item 8529 90 30 for “Open Cell of       1.         television set”. The tariff rate for this item is 15%.                  However, these items will continue at ‘Nil' BCD.            (iii) Create tariff items 8541 40 11 for “Solar Cells, not                  assembled” and tariff item 8541 40 12 for “Solar Cells                  assembled in modules or made up into panels”. The                  tariff rate for these items is 20%. However, these items                  will continue at ‘Nil' BCD.                                      61     3.   Amendment in Countervailing Duty Rules and Anti-Dumping Duty          Rules:          These rules provide for manner and procedure for investigation into          cases of imports of subsidized goods and cases of dumping of          goods, respectively, that cause injury to domestic industry.          Following amendments are being made in these rules:            S.                    Rules                       Amendment           No.           1   Anti-Dumping    Changes are being made in the Rules to               Rules           strengthen        the      anti-circumvention                               measures by making them more                               comprehensive and wider in scope to take                               care of all types of circumventions of                               antidumping duty in line with best                               international practice. Certain other                               changes are being made in these Rules for                               bringing clarity in the scope of these rules.           2    Countervailing At present, there is no provision for                Duty Rules     investigation in case of circumvention of                               countervailing duties. A provision is being                               incorporated in the Countervailing Duty                               Rules to enable investigation into case of                               circumvention of countervailing duty for                               enabling imposition of such duty. Certain                               other changes are being made for bringing                               clarity in the Rules.B.        Review of Customs duty exemption for certain imported goods: 1. Customs exemption have been reviewed to weed out such entries    that are redundant, outdated or have outlived their utility. On such    review, 80 exemptions are being withdrawn by making suitable    amendment/rescission of relevant notifications. The exemptions    being pruned on review, inter-alia, include withdrawal of exemption/    concessional rates on the following goods, namely:            S.    Category of                                            Specific items           No.      goods           1. Agro and animal Tuna bait, skimmed milk and certain milk               based products products, sugar beet seeds, raw sugar,                              certain alcoholic beverages, whey and                              isolated soya protein, soya fibre, etc.                                      62          2.    Items of Metal     a. Lead bars, rods and wire                                   b. Zinc tubes, pipes and tubes                                   c. Tin plates, sheets and strips          3.    Machinery          Machinery imported for use in certain                                   projects such as specified electricity                                   generation projects, specified Metro                                   projects,   certain    other    specified                                   purposes;                                   Specified goods required for construction                                   of roads          4.    Electronic items   Copper and articles thereof used in                                   manufacturing of specified electronic                                   items;                                   Parts for manufacture of printers, CD                                   Writers, MP3 or MP4 or MPEG 4 players,                                   pre-recorded cassettes, audio cassettes,                                   colour television tubes, etc.          5.    Miscellaneous      a. Peanut butter, preserved potatoes                                   b. Instant    print     film,   exposed                                      cinematographic films                                   c. A few redundant and outdated                                      customs duty exemptions are being                                      withdrawn.      Further,    a    few                                      exemptions are being re-aligned for                                      consistency.C.     Changes in Customs duty for creating a level playing field for MSME       and promoting MAKE IN INDIA:     1. Level playing field for domestic producers:       Customs duty is being increased on the following goods:           S.   Category of                            Rate of Duty                                  Specific items          No.      goods                             From To          1. Household goods Tableware           and 10%      20%              and appliances kitchenware          of                             porcelain or china,                             ceramic, clay, iron,                             steel,   copper     and                           63                        aluminium, glassware,                        padlocks,          brooms,                        hand-sieves,        combs,                        vacuum flasks, etc.2.   Electrical         Fans,                  food    10%    20%     Appliances         grinders/mixers,                        shavers       and       hair                        removing appliances,                        water              heaters,                        hair/hand            drying                        apparatus,           ovens,                        cookers,          toasters,                        coffee/ tea makers,                        insect         repellents,                        heaters, irons, etc.3.   Footwear           a. Footwear                    25%    35%                        b. Parts of footwear           15%    20%4.   Furniture goods    Seats,      articles      of   20%    25%                        bedding          including                        mattresses,          lamps,                        lighting,     illuminated                        signs, and other articles                        of furniture5.   Stationery items   Filing cabinets, paper         10%    20%                        trays, binders, clips,                        staples,      sign-plates,                        name plates, numbers                        and symbols etc. made                        from base metal6.   Toys               Tricycles,       scooters,     20%    60%                        scale models, dolls, etc.7.   Machinery          a. Specified goods             5%     7.5%                             used in high voltage                             power transmission                             project                        b. Railway carriage            7.5%   10%                             fans                        c. Compressors of              10%    12.5%                             refrigerators and air                             conditioners                                  64                               d. Commercial              7.5%   15%                                  freezers                               e. Welding and             7.5%   10%                                  plasma cutting                                  machine                               f. Rotary                  2.5%   7.5%                                  tillers/weeder       8.    Other             a. Glass beads             10%    20%             miscellaneous     b. Artificial flowers             items             c. Bells,         gongs,                                  statuettes, trophies                                  and like, statuettes,                                  ornaments,                                  photograph,                                  frames, mirrors etc.                                  of base metal.2.   Changes in Customs duty to promote MAKE IN INDIA under Phased     Manufacturing Programme (PMP) for Electric Vehicles and Cellular     Mobile Phones:               Changes in customs duty under Phased       Rate of Duty        a.          Manufacturing Programme for                                                         From       To                            Electric Vehicles       1.    Completely Built Units of Bus and Trucks 25%          40%             (with effect from 01.04.2020)       2.    Semi Knocked Down (SKD) units of bus, 15%             25%             trucks and two wheelers (with effect from             01.04.2020)       3.    Semi Knocked Down (SKD) units of 15%                  30%             passenger vehicles and three wheelers             (with effect from 01.04.2020)       4.    Completely Knocked Down (CKD) units of 10%            15%             passenger vehicles, three wheelers, two             wheelers, bus and trucks (with effect from             01.04.2020)                Changes in customs duty under Phased Manufacturing        b.                        Programme for Cellular Mobile Phones       1.    PCBA of Mobile phones (with effect from 10%           20%             01.04.2020)       2.    Vibrator/Ringer of Mobile phones (with       Nil      10%             effect from 01.04.2020)                                   65      3.   Display Panel and Touch Assembly (with    Nil     10%           effect from 01.10.2020)3. Changes in Customs duty to promote MAKE IN INDIA in Electronics   sector:       S.                                            Rate of Duty                   Specific Items      No.                                           From           To      1.  Motors like Single Phase AC               7.5%          10%          motors,     Stepper     motors,          Wiper Motors etc.      2.  Specified chargers and power         Applicable Rate       20%          adapters      3.  Fingerprint readers for use in              Nil            15%          cellular mobile phones      4.  Earphones and headphones             Applicable Rate       15%4. Reduction in Customs duty on raw materials and inputs imported   by Domestic Manufacturers:       Category                                              Rate of duty S.    of Inputs/                                           From       To                              Specific ItemsNo.       Raw       materials1.    Fuels,        Very low sulphur fuel oil meeting       10%       Nil      Chemicals     ISO 8217:2017 RMG380 Viscosity      and           in 220-400 CST standards/Marine      Plastics      Fuel 0.5% (FO)                    Calcined Petroleum Coke                 10%      7.5%                    Calendared plastic sheets used in       10%       5%                    manufacturing of smart cards                    Polyester Liquid Crystal Polymers       7.5%      Nil                    for use in manufacture of                    connectors2.    Precious      Platinum or Palladium used in           12.5%    7.5%      Metals        manufacture of:                      a) Colloidal precious metals,                         inorganic       or     organic                         compounds of precious metal,                         amalgams of precious metals                      b) Catalyst with precious metal                         or precious metal compounds                         as the active substance                                 66                  Spent Catalyst or Ash containing 12.5% 11.85%                  precious metal, subject to                  specified conditions3.     Machinery Following parts of Microphone for      10%    Nil       and        use in manufacture of Microphone       Electronic namely,       Goods          a) microphone cartridge                      b) microphone holder                      c) microphone grill                      d) microphone body                  Micro-fuse base, sub-miniature 7.5%          Nil                  fuse base, Micro-fuse Cover and                  sub-miniature fuse cover for use in                  manufacture of micro fuse and                  sub-miniature fuse.4.     Sports     Willow is being included in the list Applica Nil       Goods      of items allowed duty free import ble Rate                  up to 3% of FOB value of sports                  goods exported in the preceding                  financial year5.     Newsprint a) Newsprint, when imported by         10%    5%                      importer      registered   with                      Registrar of Newspapers, India.                  b) Uncoated paper used for                      printing newspaper, when                      imported        by      importer                      registered with Registrar of                      Newspapers, India.                  c) Lightweight coated paper used                      for printing magazines subject                      to actual user condition.5. Other changes in Customs duty:  S.     Category of                                   Rate of Duty                            Specific Items No.        Goods                                   From        To1.     Food          Walnuts, shelled               30%        100%       processing2.     Chemicals and Colloidal precious metals,     7.5%      10%       Plastics      inorganic     or     organic                     compounds of precious                     metal,     amalgams       of                     precious metals                     Butyl Acrylate                  5%       7.5%                                   67                     Other prepared binders for       10%         17.5%                     foundry moulds or cores;                     Chemical products and                     preparations       of    the                     chemical        or    allied                     industries3.     Auto and auto Catalytic converter              10%         15%       parts         Noble metal solutions and        5%          10%                     noble metal compounds                     used in manufacture of                     catalytic converter and its                     parts                     Platinum or Palladium used        5%     Applicable                     in     manufacturing      of               Rate                     catalytic converter and its                     parts                     Parts and other specified         5%         7.5%                     inputs for manufacture of                     catalytic converters.                     Completely Built Units           30%         40%                     (CBUs) of commercial                     vehicles     (other    than                     electric vehicles)                     (with       effect     from                     01.04.2020)D     Imposition of Health cess on specified medical equipment:Health Cess at the rate of 5% is proposed to be imposed on the import ofmedical devices. This Health Cess shall be a duty of Customs. Health Cessshall not apply to medical devices which are exempt from BCD. Further,inputs/parts used in the manufacture of medical devices shall also beexempt from Health Cess. The proceeds of Health Cess shall be used forfinancing the health infrastructure and services.E.    Revocation of Anti-Dumping Duty on Purified Terephthalic Acid: Revocation of Anti-dumping duty on import of Purified Terephthalic Acid originating in or exported from: -     1. South Korea and Thailand imposed vide notification No. 28/2019-        Customs (ADD) dated 24.7.2019     2. China, Iran, Indonesia, Malaysia and Taiwan imposed vide        notification No. 28/2016-Customs (ADD) dated 5.7.2016                                  68F. Increase in National Calamity Contingent duty (NCCD) on Cigarettes   and tobacco products:   National Calamity Contingent Duty is levied as a duty of excise on   certain manufactured goods specified under the Seventh Schedule of   Finance Act, 2001. NCCD is being proposed to be increased on tobacco   products (except bidi) as detailed below:   1. On cigarettes, NCCD is being increased ranging from Rs. 200 – 735      per thousand, depending upon length of cigarette and on      filter/non-filter basis.   2. On smoking mixtures for pipes and cigarettes, NCCD is being      increased from 45% to 60%.   3. On other forms of smoking tobacco (other than smoking mixtures      for pipes and cigarettes) and forms of chewing tobacco, NCCD is      being increased from 10% to 25%.   4. NCCD on Bidis remains unchanged.G. Proposals involving change in provisions of Central Goods and   Services Tax Act, 2017:                        Amendments in the Central Goods and      S.                        Services Tax Act, 2017 /     No.           Integrated Goods and Services Tax Act, 2017 /                 Union Territory Goods and Services Tax Act, 2017      A    For facilitating trade or consumer      1    Sub section (4) of the section 16 of the CGST Act is being           amended to delink the date of issuance of debit note from           the date of issuance of the underlying invoice for purposes of           availing input tax credit.      2    Clause (c) of sub-section (1) of section 29 of the CGST Act is           being amended to provide for cancellation of registration           which has been obtained voluntarily under sub-section (3) of           section 25.      3    A proviso to sub-section 1 of section 30 of the CGST Act is           being inserted to empower the jurisdictional tax authorities           to extend the date for application of revocation of           cancellation of registration in deserving cases.      4    Section 51 of the CGST Act is being amended to remove the           requirement of issuance of TDS certificate by the deductor;           and to omit the corresponding provision of late fees for delay           in issuance of TDS certificate.      5    Section 168 of the CGST Act is being amended to make           provisions for enabling the jurisdictional commissioner to                             69     exercise powers under sub-section (5) of section 66 and     second proviso to sub-section (1) of section 143.B    For improving compliance1.   Section 10 of the CGST Act is being amended, so as to exclude     from the ambit of the Composition scheme certain categories     of taxable persons, engaged in making-     (i) supply of services not leviable to tax under the CGST Act, or     (ii) inter-State outward supply of services, or     (iii) outward supply of services through an e-Commerce     operator.2.   Section 122 of the CGST Act is being amended by inserting a     new sub-section to make the beneficiary of the transactions     of passing on or availing fraudulent Input Tax Credit liable for     penalty similar to the penalty leviable on the person who     commits such specified offences.3.   Section 132 of the CGST Act is being amended to make the     offence of fraudulent availment of input tax credit without an     invoice or bill a cognizable and non-bailable offence; and to     make any person who commits, or causes the commission     and retains the benefit of transactions arising out of specified     offences liable for punishment.C    Other changes1.   The definition of “Union territory” in clause (114) of section 2     of the CGST Act is being amended to update the definition of     Union territory in view of the bringing into force of the     Jammu and Kashmir Reorganization Act, 2019 and the Dadra     and Nagar Haveli and Daman and Diu (Merger of Union     Territories), Act, 2019.     Consequential changes are also being made in UTGST Act,     2017.2.   Section 31 of the CGST Act is being amended to provide     enabling provision to prescribe the manner of issuance of     invoices in case of supply of taxable services.3.   Section 109 of the CGST Act is being amended to bring the     provision for Appellate Tribunal under the CGST Act in the     Union territory of Jammu and Kashmir and Ladakh.4.   Section 140 of the CGST Act is being amended with effect     from 01.07.17, to prescribe the manner and time limit for     taking transitional credit.5.   Section 172 of the CGST Act is being amended to make     provision for enabling issuance of removal of difficulties order                                     70             for another 2 years, i.e. till five years from the date of             commencement of the said Act.             Similar changes are also being made in the IGST Act, 2017             (section 25), the UTGST Act, 2017 (section 26) and the GST             (Compensation to States) Act, 2017 (section 14).        6.   Entries at 4(a) & 4(b) in Schedule II of the CGST Act is being             amended with effect from 01.07.2017 to make provision for             omission of supplies relating to transfer of business assets             made without any consideration from Schedule II of the said             Act.     The proposed changes in GST laws will come into effect from the date     when the same will be notified, as far as possible, concurrently with the     corresponding amendments to the similar Acts passed by the States &     Union territories with legislature.H.    Retrospective amendments to give effect to the recommendations      of the GST Council:        S.   Retrospective amendment in the Goods and Service Tax rate       No.                        and refund provisions        1    Exemption from Central Tax, Union Territory Tax and             Integrated Tax is being given on fishmeal [HS 2301], for the             period 01.07.2017 to 30.09.2019. However, GST paid on             supply of fishmeal during the period shall not be refunded.        2    Concessional 12% rate of Integrated Tax and 6% Central Tax             and 6% Union Territory Tax during the period 01.07.2017 to             31.12.2018, on pulley, wheels and other parts (falling under             heading 8483) and used as parts of agricultural machinery of             headings 8432, 8433, and 8436. However, GST paid at any             other rate (higher than 12%) shall not be refunded.        3    The refund of accumulated credit of compensation cess on             tobacco products arising out of inverted duty structure in             Compensation Cess has been disallowed with effect from             1.10.2019 vide notification No. 3/2019- Compensation Cess             (Rate) dated 30.9.2019. This notification is being given             retrospective effect from 1.7.2017 onwards. Accordingly, no             refund on account of inverted duty structure shall be             admissible on tobacco products for any period.For further details of the budget proposals, the Explanatory Memorandumand other relevant budget documents may be referred to.