The Hon Finance Minister, Mrs Nirmala Sitharaman, presented the Union Budget 2022 in Parliament on February 1st, 2022. The budget lays emphasis on 4 pillars of economic growth this fiscal year. Let us skim through key developments under all 4 umbrella points:
PM Gati Shakti:
This is the National Master Plan for Multimodal Connectivity launched in October 2021. It is a digital platform that strives to unite 16 ministries, including roadways and railways, in executing public infrastructure projects that enhance national connectivity. It is expected to create 60 lakh new jobs in the process.
- The initiative shall be powered by 7 identified engines – Roadways, Railways, Airports, Waterways, Mass Transport, Ports, and Logistical Infrastructure.
- A master plan for the construction of 25,000 km of National Highways shall be formulated to ensure completion in the fiscal year 2022-23.
- Postal Services and Railways shall be integrated to make parcel movement more efficient. Connectivity between mass public transport and railway stations shall also be improved.
- A Logistical Interface Platform will allow operators across all modes of transport to exchange data with each other. It will streamline the process of planning and implementation of all coordinated projects.
This aspect aims to benefit farmers and the agricultural industry, Education, Health, and all-inclusive Welfare in the country.
- Chemical-free natural farming shall be given a significant push starting with farming activities along the shores of the Ganges in 5 km wide corridors.
- Post-harvest value addition and millet consumption shall be a key area of focus. Millet products shall be branded locally and internationally to achieve the same.
- Public-Private Partnerships (PPP) shall be leveraged to connect farmers with advanced digital technology.
- Kisan drones will assess crop quality and digitize land data over and above the spraying of insecticides and pesticides.
- Agri-startups shall be infused with capital through the launch of a dedicated fund.
- The ‘One Class One TV’ initiative will be driven to cover 200 TV channels.
- E-skilling will be initialized using a Digital University that shall provide world-class education to all. The creation and curation of quality content for the same will take precedence.
- The National Digital Health Ecosystem (for digitized health records) and the National Tele-Mental Health Program (to tackle pandemic-induced mental health issues) shall be launched.
All-inclusive Welfare (Plan for 2022-23):
- 3.8 crore rural households will be provided with water supply
- Affordable housing to the poor: 80 lakh houses to be constructed INR 48,000 crore allocated.
- Infrastructure and social development will be given attention in the North-Eastern regions of India
- 100% Post Offices shall be digitized and integrated into the banking system.
- MSMEs: ECLGS will focus on the hospitality segment (expanded by INR 50,000 crore), and multiple portals will be interlinked with organic databases to improve credit access and business opportunities.
Boosting Productivity and Investment, Sunrise Opportunities, Transition to Green Energy and Action on Climate Change
- Ease of Doing Business:
- IT systems will connect the Centre and State level operations.
- Animation, Virtual Effects, Comics and Gaming Taskforce shall be set up to focus on this new avenue of youth employment.
- The 5G spectrum auction will target completion in 2022-23.
- Ease of Living:
- E-Passports embedded with chips shall be issued as a digitization effort.
- Dedicated Centres of Excellence will drive urban planning.
Financing of Investments
This encompasses all financial decisions that shall drive investments in various segments.
- Transfer of cryptocurrencies or ‘Virtual Digital Assets’ shall be directly taxed at a flat rate of 30%. This is the first step towards embracing cryptocurrencies and their underlying blockchain technology.
- The Digital Rupee shall be launched to leverage the highly secure and efficient blockchain technology. The digitization of fiat currency is expected to boost the economy.
- A fund of INR 1 lakh crore has been earmarked for States in the form of interest-free loans for 50 years. This is to speed up capital investment in the PM Gati Shakti Master Plan. This is an additional provision over and above ongoing borrowings.
The Union Budget 2022 envisions the catalysis of long-term growth through sustained capital expenditure and effective governance systems. Urbanization, digitization, domestic manufacturing, and rural upliftment lie at the heart of the budget. Policy reforms to tackle unforeseen challenges are also an integral part of this year’s budget. It does not overlook new job creation and looks aligned with the direction set by the budget last year.
Do check out our detailed analysis on ‘Budget 2022’ here –