MARCH YOJANA
Budget Union Budget, this year, was presented amidst a host of uncertainties. Demonetisation drive and imminent GST drive, new administration in U.S etc. made the whole exercise very challenging. The overall objective of the budget was Transform, Energise and Clean India, the Budget adopted a multipronged(बह आय म ) approach and gave attention to all sectors of the Economy with Adequate thrust on rural development, agriculture, infrastructure, skill development, manufacturing and employment generation.
Farmers and rural population Measures have been announced to DOUBLE the income of the Indian farmers in five years. Agriculture credit allocation has been increased to Rs. 10 Lakh crore, Rs 1 lakh crore hike Long term irrigation fund has been increased to Rs. 40,000 crores
MCQ Railway budget was separated from General Budget in which year? A. 1900 B. 1921 C. 1915 D. 1912
Current Macro Trends The Central Statistical Office projects India s GDP growth (advance estimate) for 2016-17 to be 7.1 per cent. However, the CSO itself submits that this Advanced estimate does not capture the demonetisation impact. Post demonetisation, banks have passed on the interest rate cuts on loans/deposits. This is expected to result in higher credit demand and hence higher growth.
Main Highlights of the budget Traditional Sector Infrastructure Budget and Macro Economics Policies of Revenue Mobilisation Banking Crisis and NPA issues Demonetisation and Budget Budget and Digital economy
Traditional Sector The difficulties of the agricultural farmers can be divided into three main stages. Pre-harvest, harvest and post-harvest stage. A. The pre-harvest issues are related to credit, fertilisers and irrigation. B. The harvesting problems include the drought or flood situation and the insurance cover from these. C. Post harvest risks related to marketing, price risk and transportation.
Steps to help farmers The budget enhances agriculture credit for 2017-8 to 10 lakh crores from 9 lakh crore in 2016-17. Long-term irrigation fund in NABARD increased from Rs 20,000 crore to Rs40,000 crore. Dairy processing infrastructure fund with a corpus of Rs. 2000 crore will be created. enam (electronic National Agriculture Market) will be expanded to 585 regulated markerts.
MCQ The total allocation for rural, agricultural and allied sectors for 2017-18 is Rs 187223 crore, which is how much per cent higher than previous year? A. 10% B. 24% C. 50% D. 4%
Infrastructure Government aims to achieve 100 percent village electrification by 1 st may 2018 An allocation of Rs. 4,814 crores is given under the Deendayal Upadhyaya Gram Jyoti Yojana Keeping in view the above problems, Ministry of Power, Government of India has launched Deen Dayal Upadhyaya Gram Jyoti Yojana for rural areas having following objectives: i) To provide electrification to all villages ii) Feeder separation to ensure sufficient power to farmers and regular supply to other consumers iii) Improvement of Sub-transmission and distribution network to improve the quality and reliability of the supply iv) Metering to reduce the losses
Infrastructure Under Pradhan Mantri Gram Sadk Yojana construction of roads reached 133km roads per day in 2016-17, as against an average of73 km during the period 2011-2014 The allocation under the scheme has been increased to Rs. 19,000 crore For the railways, the budget will allocate Rs. 55,000 crores for its expansion. Overall transport sector budget is of 2.41 lakh crore suggesting that major focus appears to be reviving growth through expansion in transport sector.
Notes The Budget allocation for Highways has gone up from Rs 57,976 crores in BE 2016-17 to Rs 64,900 crores in 2017-18. 2,000 kms of coastal connectivity roads have been identified for construction and development. This will facilitate better connectivity with ports and remote villages. For the Shipping Ministry the allocation has gone up from Rs 1531 crores in BE 2016-17 to Rs 1773 Crores. Rs 600 crores have been allocated for Sagarmala programme.
Further Fiscal deficit for FY18: Pegged at 3.2% of GDP. Revenue deficit for FY18: Pegged at 1.9% Revenue mobilisation Only 7 out of 100 people are tax payers(according to economic survey). To widen the tax base, the budget has reduced the tax rate to 5 per cent in the lower slab
Demonetisation and Budget SIAM data shows automobile sector sales declined 18.66% in December 2016. Especially, sale of two-wheelers and three-wheelers which are mostly paid for in cash, declined 22.4% and 36.23%, respectively. According to Knight Frank data, real estate sector sales declined by more than 50% in the last quarter of 2016. Economic Survey estimates that the adverse impact of demonetisation on GDP is in the range of 0.25% to 1%
Positives On the other hand, despite slowdown in GDP growth, tax revenues appear to have increased. 1. Corporate tax 4.4% 2. Central Excise Duty 43% 3. Service tax 23.9% 4. Customs duty 4.1% According to Economic Survey and national Payments Corporation of India RuPay based electronic transactions increased by about 13,000 crore in case of POS transactions and about Rs. 2000 crore in e-commerce, an increase of over 300-400 per cent in the last few months.
The total capital and development expenditure on Railways has been pegged at how much amount for the year 2017-18? [A] Rs. 2,31,000 crores [B] Rs. 1,41,000 crores [C] Rs. 1,31,000 crores
Budget and Digital Economy In this area, India faces three main challenges. 1. Cyber security 2. Digital infrastructure 3. Cost of digital transactions
Cyber security To safe guard the integrity and stability of the financial sector from growing number of cyber-attacks, the budget proposed a Computer Emergency Response Team for our Financial Sector (CERT-Fin) Last year, more than 32 lakh debit cards of various public and private sector banks were compromised. It was one of the biggest cyber frauds related to banks in India.
Digital infrastructure Budget renews its focus on BharatNet, DigiGaon, Modified Special incentive Package Scheme by increasing allocations. The allocation for the ambitious Bharat Net project is being stepped up to Rs 10,000 crore in 2017-18 and high-speed broadband on optical fibre will be available in over 1.5 lakh gram panchayats with hotspots and access to digital services at low tariffs A 'Digi Gaon' initiative will also be launched to provide telemedicine, education and skills through digital technology
Passenger safety It has been felt for the last few years that separate investment window is required for upgrading safety. Because internal generation of financial resources was not able to meet the requirements of safety funding. Rashtriya Rail Sanraksha Kosh (National Rail Safety Fund) with a corpus of Rs 1 lakh crore.(for a period of 5 years) The budget has outlined complete elimination of unmanned level crossing by 2020.
Capital and development Works Budget increased from 121,000 crore to 131,000 crore The budget targeted commissioning of 3500 km of railway line in 2017-18 as copared to 2800 Km in 2016-17 500 stations will be made differently abled friendly by providing lifts and escalators. It is proposed to feed about 7,000 stations with solar power in the medium term.
Cleanliness Swach Rail SMS based Clean My Coach Service has gained popularity. Budget now proposes Coach Mitra facility, a single window interface to register all coach related requirements. Toilet discharge from the train is a very pathetic sight as it causes corrosion to the rails. The budget proposes to fit all coaches with bio-toilets by 2019.
Notes Budget for sports has been enhanced by 40%, Sports budget hiked by Rs 350 crore Jaitley allocated a total of Rs 1943 crore National-level competitions have been organized under the Khelo India Programme so as it to initiate a sporting culture in the country. The Union Government has merged Rajiv Gandhi Khel Abhiyan (RGKA) with the Khelo India Programme for development of sports.
Strengths The large gap existing between inflation rates measured through wholesale price index and consume price index in 2015-16 has been bridged now and the relative prices in the economy have considerably stabilized. Demonetization of high value currencies is likely to yield long term benefits of reducing corruption, increasing household financial savings and widening the tax net. GST will result in single nation wide market; better tax compliance, higher investment and growth India s share in world manufacturing exports is rising
Weaknesses GST implementation to begin with is likely to suffer from suboptional design and too complicated a structure for efficiency gains. Ideological and philosophical confusion regarding public and private sector has left to underproductive delays and debates over allowing exits, divestments of government stake. Private investment is low and exports are no longer growing at high rates
Opportunities Reform the bankruptcy laws for exits of corporation to release locked up resources. Government has already launched the bankruptcy code 2016 and now its efficiency implementation holds the key Focus on competitive and cooperative federalism presents a great potential to attract skills, investment and technology.
Oil prices are on the rise Threats Competitive populism in a federal democracy can damage fiscal discipline and governance standards International rating agencies have not been consistent in upgrading their ratings of different countries when their macroeconomic over the time is compared.
How much amount was allocated for Minority Affairs in Union Budget 2017? [A] Rs 5980 crore [B] Rs 1645 crore [C] Rs 4195 crore
Youth The SWAYAM platform, which hosts courses online, will make 350 courses available. Access to the platform will be increased by linking it to DTH channels dedicated to education. 100 India International Skill Centres will be set up across the country under the Skill India Mission. With an allocation of 4,000 crore, the government is also going to introduce a Skill Acquisition and Knowledge Awareness Program called SANKALP to provide market-relevant training to 3.5 crore youth.
Health Health allocation in the union budget has gone up to 50,283 crore, which is a healthy increase of about 27% Two AIIMS will be set up in Gujarat and Jharkhand Aadhaar-based smartcards will be issued to monitor health of senior citizens.