24 Jul | UPSC Current Affairs: Union Budget Highlights: Agriculture, Employment, Reforms & More

UPSC GS 2

Union Budget

• News:  Union Finance Minister Nirmala Sitharaman recently presented the first budget of the Narendra Modi government’s third term in Parliament. 
• Key Focus Areas: The Finance Minister laid down nine priorities of the Budget:
  • • Productivity and resilience in agriculture
    • Employment and skilling
    • Inclusive Human resource development and social justice
    • Manufacturing and services
    • Support for promotion of MSMEs
    • Urban development
    • Energy security
    • Infrastructure
    • Innovation, research and development

Read also: Understanding Overview of Economic Survey | UPSC

Priority 1: Productivity and Resilience in Agriculture

• Transforming Agriculture Research:
  • • A comprehensive review of the agriculture research setup will be undertaken to focus on raising productivity and developing climate-resilient varieties.
    • Funding will be provided in a challenge mode, including to the private sector.
    • Domain experts from both the government and outside will oversee the conduct of such research.
• Release of New Varieties: 
  • • New 109 high-yielding and climate-resilient varieties of 32 field and horticulture crops will be released for cultivation by farmers.
• Natural Farming: 
  • • In the next two years, 1 crore farmers across the country will be initiated into natural farming supported by certification and branding.
    • Implementation will be through scientific institutions and willing gram panchayats.
    • 10,000 need-based bio-input resource centres will be established.

• Missions for Pulses and Oilseeds: 
  • • A strategy is being put in place to achieve ‘atmanirbharta’ for oilseeds such as mustard, groundnut, sesame, soybean, and sunflower.
• Vegetable Production & Supply Chains:
  • • Large-scale clusters for vegetable production will be developed closer to major consumption centres.
    • Farmer-Producer Organizations, cooperatives, and start-ups will be promoted for vegetable supply chains, including for collection, storage, and marketing.
• Digital Public Infrastructure for Agriculture: 
  • • Implementation of the Digital Public Infrastructure (DPI) in agriculture for coverage of farmers and their lands will be facilitated in partnership with the states within 3 years.
    • Digital crop survey for Kharif using the DPI will be taken up in 400 districts this year.
    • Details of 6 crore farmers and their lands will be brought into the farmer and land registries.
    • Issuance of Jan Samarth based Kisan Credit Cards will be enabled in 5 states.
• Shrimp Production & Export:
  • • Financial support for setting up a network of Nucleus Breeding Centres for Shrimp Broodstocks will be provided.
    • Financing for shrimp farming, processing, and export will be facilitated through NABARD.
• National Cooperation Policy: 
  • • A National Cooperation Policy will be brought out for the systematic, orderly, and all-round development of the cooperative sector.
    • The policy goal will be fast-tracking the growth of the rural economy and generating employment opportunities on a large scale.
    • Financial Provision
    • A provision of ₹ 52 lakh crore for agriculture and allied sectors has been made this year.

Priority 2: Employment & Skilling

• Employment Linked Incentive: 
  • • Three schemes under the Prime Minister’s package for ‘Employment Linked Incentive’ will be implemented, based on EPFO enrolment and focusing on first-time employees and support for employees and employers.
• Scheme A: First Timers: 
  • • One month’s wage as subsidy (maximum `15,000)
    • Applicable to all sectors
    • First timers have a learning curve before they become fully productive; subsidy is to assist employees and employers in hiring of first timers.
    • Applicable to all persons newly entering the workforce (EPFO) with wage/salary less than Rs. 1 lakh per month.
    • Subsidy will be paid to the employee in three instalments
    • Employee must undergo compulsory online Financial Literacy course before claiming the second instalment.
    • Subsidy to be refunded by employer if the employment to the first timer ends within 12 months of recruitment.
    • Expected to cover approximately one crore persons per annum.
    • Scheme will be for 2 years
• Scheme B: Job Creation in Manufacturing
  • • Incentivizes additional employment in the manufacturing sector, linked to first-time employees.
    • All employers which are corporate entities and those non-corporate entities with a three year track record of EPFO contribution will be eligible.
    • Employer must hire at least the following number of previously non-EPFO enrolled workers: 50 or 25% of the baseline (previous year’s number of EPFO employees)
    • Incentive will be paid for four years partly to the employee and partly to the employer as follows:
    • Employer must maintain threshold level of enhanced employment throughout, failing which subsidy benefit will stop.
    • Employee must be directly working in the entity paying salary/wage (i.e. in-sourced employee).
    • Employees with a wage/ salary of up to `1 lakh per month will be eligible, subject to contribution to EPFO.
    • For those with wages/salary greater than `25,000/month, incentive will be calculated at `25,000/month.
    • Subsidy to be refunded by employer if the employment to first timer ends within 12 months of recruitment.
    • Scheme will be for 2 years
• Scheme C: Support to Employers
  • • Additional employment within a salary of ₹ 1 lakh per month will be counted.
    • Government will reimburse up to ₹ 3,000 per month for 2 years towards employers’ EPFO contribution for each additional employee.
    • Expected to incentivize additional employment of 50 lakh persons.
    • Applicable to an employer who:
      • Increases employment above the baseline (previous year’s number of EPFO employees) by at least two employees (for those with less than 50 employees) or 5 employees (for those with 50 or more employees) and sustains the higher level, and
      • For employees whose salary does not exceed `1,00,000/month
      • New employees under this Part need not be new entrants to EPFO
    • If the employer creates more than 1000 jobs:
      • Reimbursement will be done quarterly for the previous quarter
      • Subsidy will continue for the 3rd and 4th year on the same scale as Employer benefit in Part-B
    • Scheme will be for 2 years
    • Expected to incentivize additional employment of 50 lakh persons.
• Participation of Women in the Workforce: 
  • • Setting up working women hostels in collaboration with industry and establishing creches.
• Skilling Programme: 
  • • A new centrally sponsored scheme for skilling in collaboration with state governments and industry.
    • 20 lakh youth to be skilled over a 5-year period.
    • 1,000 Industrial Training Institutes will be upgraded in hub and spoke arrangements with outcome orientation.
    • Total outlay of ` 60,000 crore over five years
      • Government of India—` 30,000 crore
      • State Governments—` 20,000 crore
      • Industry—` 10,000 crore (including CSR funding)
    • 200 hubs and 800 spoke ITIs –all with industry collaboration
      • Re-design and review of existing courses
      • New courses
      • 1 to 2 year courses in all 1000 ITIs
      • Short term specialised courses in Hub ITIs
    • Capacity augmentation of 5 national institutes for training of trainers.
• Skilling Loans: 
  • • The Model Skill Loan Scheme will be revised to facilitate loans up to ₹ 5 lakh with a guarantee from a government-promoted fund.
    • Expected to help 25,000 students every year.
• Education Loans:
  • • Financial support for loans up to ₹ 10 lakh for higher education in domestic institutions.
    • E-vouchers for annual interest subvention of 3 per cent of the loan amount will be given directly to 1 lakh students every year.

Priority 3: Inclusive Human Resource Development and Social Justice

• Saturation Approach: 
  • • Adoption of a saturation approach to cover all eligible people through various programs for education and health.
    • Empowerment by improving capabilities through schemes for craftsmen, artisans, self-help groups, scheduled caste, scheduled tribe, women entrepreneurs, and street vendors.
    • Implementation of PM Vishwakarma, PM SVANidhi, National Livelihood Missions, and Stand-Up India will be stepped up.
• Purvodaya: 
  • • Formulation of the Purvodaya plan for the all-round development of Bihar, Jharkhand, West Bengal, Odisha, and Andhra Pradesh.
    • Coverage includes human resource development, infrastructure, and economic opportunities.
    • Support for development on the Amritsar Kolkata Industrial Corridor, including an industrial node at Gaya.
    • Development of road connectivity projects: Patna-Purnea Expressway, Buxar-Bhagalpur Expressway, Bodhgaya, Rajgir, Vaishali, and Darbhanga spurs, and an additional 2-lane bridge over river Ganga at Buxar.
    • Power projects, including a new 2400 MW power plant at Pirpainti, will be undertaken.
    • New airports, medical colleges, and sports infrastructure in Bihar will be constructed.
    • Additional allocation for capital investments and expedited external assistance from multilateral development banks for Bihar.
• Andhra Pradesh Reorganization Act: 
  • • Facilitation of special financial support for the state’s capital through multilateral development agencies.
    • Arrangement of ₹ 15,000 crore in the current financial year, with additional amounts in future years.
    • Commitment to financing and early completion of the Polavaram Irrigation Project.
    • Promotion of industrial development with funds for essential infrastructure in Kopparthy node on the Vishakhapatnam-Chennai Industrial Corridor and Orvakal node on Hyderabad-Bengaluru Industrial Corridor.
    • Additional allocation for capital investment and grants for backward regions of Rayalaseema, Prakasam, and North Coastal Andhra.
• PM Awas Yojana: 
  • • Announcement of three crore additional houses under PM Awas Yojana in rural and urban areas, with necessary allocations.
• Women-Led Development: 
  • • Allocation of more than ₹ 3 lakh crore for schemes benefitting women and girls, promoting women-led development.
• Pradhan Mantri Janjatiya Unnat Gram Abhiyan: 
  • • Launch of Pradhan Mantri Janjatiya Unnat Gram Abhiyan to improve the socio-economic condition of tribal communities.
    • Saturation coverage for tribal families in tribal-majority villages and aspirational districts, covering 63,000 villages and benefiting 5 crore tribal people.
• Bank Branches in North-Eastern Region: 
  • • Establishment of more than 100 branches of India Post Payment Bank in the North East region to expand banking services.
• Rural Development Provision: 
  • • A provision of ₹ 66 lakh crore for rural development, including rural infrastructure, has been made.

Priority 4: Manufacturing & Services

• Support for Promotion of MSMEs:  
  • • Special attention will be given to MSMEs and labour-intensive manufacturing through financing, regulatory changes, and technology support.
• Credit Guarantee Scheme for MSMEs in the Manufacturing Sector: 
  • • Term loans for MSMEs for machinery and equipment purchase without collateral.
    • Operated through pooling credit risks of MSMEs.
    • Self-financing guarantee fund to provide up to ₹ 100 crore guarantee cover per applicant.
    • Borrower to provide an upfront guarantee fee and annual fee on the reducing loan balance.
• New Assessment Model for MSME Credit: 
  • • Public sector banks to build in-house capability for MSME credit assessment.
    • Development of a new credit assessment model based on MSME digital footprints.
    • Model to include MSMEs without formal accounting systems.
• Credit Support to MSMEs during Stress Period: 
  • • New mechanism for continuation of bank credit to MSMEs during stress periods.
    • Support for credit availability through a government-promoted guarantee fund.
• Mudra Loans: 
  • • Mudra loan limit increased to ₹ 20 lakh from ₹ 10 lakh for entrepreneurs who have successfully repaid previous loans under the ‘Tarun’ category.
• Enhanced Scope for Mandatory Onboarding in TReDS: 
  • • Turnover threshold for mandatory onboarding on TReDS platform reduced from ₹ 500 crore to ₹ 250 crore.
    • Inclusion of 22 more CPSEs and 7000 more companies.
    • Medium enterprises included in the scope of suppliers.
• SIDBI Branches in MSME Clusters: 
  • • SIDBI to open new branches to serve all major MSME clusters within 3 years.
    • 24 branches to open this year, expanding service coverage to 168 out of 242 major clusters.
• MSME Units for Food Irradiation, Quality & Safety Testing: 
  • • Financial support for setting up 50 multi-product food irradiation units in the MSME sector.
    • Facilitation of 100 food quality and safety testing labs with NABL accreditation.
• E-Commerce Export Hubs: 
  • • E-Commerce Export Hubs to be set up in PPP mode for MSMEs and traditional artisans.
    • Hubs to facilitate trade and export-related services under one roof.
• Measures for Promotion of Manufacturing & Services: 
• Internship in Top Companies:
  • • Launch of a scheme for internship opportunities in 500 top companies for 1 crore youth over 5 years.
    • Interns to receive ₹ 5,000 per month allowance and ₹ 6,000 one-time assistance.
    • Companies to cover training costs and 10% of internship costs from CSR funds.
    • Applicable to those who are not employed and not engaged in full time education.
    • Youth aged between 21 and 24 will be eligible to apply.
    • Cost sharing (per annum):
      • Government – `54,000 towards monthly allowance (plus `6,000 grant for incidentals)
      • Company – Rs 6,000 from CSR funds towards monthly allowance
      • Training cost to be borne by the Company from CSR funds.
      • Administrative costs to be borne by respective parties (for the Company, reasonable administrative expenses can be counted as CSR expenditure)
    • Participation of companies is voluntary.
    • Ineligible candidates (indicative list)
    • Candidate has IIT, IIM, IISER, CA, CMA etc as qualification
    • Any member of the family is assessed to Income Tax
    • Any member of the family is a government employee, etc.
    • At least half the time should be in actual working experience/job environment, not in classroom.
    • Phase 1 of the scheme will be for 2 years followed by Phase 2 for 3 years
• Industrial Parks:
  • • Development of “plug and play” industrial parks in or near 100 cities in partnership with states and the private sector.
    • Twelve industrial parks under the National Industrial Corridor Development Programme to be sanctioned.
• Rental Housing:
  • • Facilitation of dormitory-type rental housing for industrial workers in PPP mode with VGF support and commitment from anchor industries.
• Shipping Industry:
  • • Implementation of ownership, leasing, and flagging reforms to improve the Indian shipping industry’s share and generate employment.
• Critical Mineral Mission:
  • • Establishment of a Critical Mineral Mission for domestic production, recycling, and overseas acquisition of critical minerals.
    • Mandate includes technology development, skilled workforce, extended producer responsibility framework, and suitable financing mechanism.
• Offshore Mining of Minerals:
  • • Launch of the first tranche of offshore blocks for mining, building on existing exploration.
• Digital Public Infrastructure Applications:
  • • Development of DPI applications for productivity gains, business opportunities, and innovation in credit, e-commerce, education, health, law and justice, logistics, MSME, services delivery, and urban governance.
• Integrated Technology Platform for IBC Ecosystem:
  • • Setup of an Integrated Technology Platform for improving outcomes under the Insolvency and Bankruptcy Code (IBC).
• Voluntary Closure of LLPs:
  • • Extension of C-PACE services for voluntary closure of LLPs to reduce closure time.
• National Company Law Tribunals:
  • • Reforms and strengthening of tribunals to speed up insolvency resolution.
    • Establishment of additional tribunals, some to decide cases exclusively under the Companies Act.
• Debt Recovery:
  • • Reforming and strengthening debt recovery tribunals.
    • Establishment of additional tribunals to speed up recovery.

Priority 5: Urban Development     

• Cities as Growth Hubs: 
  • • Development of ‘Cities as Growth Hubs’ through economic and transit planning.
    • Orderly development of peri-urban areas using town planning schemes in collaboration with states.
• Creative Redevelopment of Cities:
  • • Formulation of a framework for enabling policies, market-based mechanisms, and regulation for brownfield redevelopment of existing cities.
• Transit-Oriented Development: 
  • • Formulation of Transit-Oriented Development plans for 14 large cities with a population above 30 lakh.
    • Implementation and financing strategy to be included.
• Urban Housing: 
  • • Addressing housing needs of 1 crore urban poor and middle-class families under PM Awas Yojana Urban 2.0.
    • Investment of ₹ 10 lakh crore, with ₹ 2.2 lakh crore central assistance over the next 5 years.
    • Provision of interest subsidy for affordable housing loans.
    • Implementation of enabling policies and regulations for efficient and transparent rental housing markets.
• Water Supply and Sanitation: 
  • • Promotion of water supply, sewage treatment, and solid waste management projects for 100 large cities in partnership with State Governments and Multilateral Development Banks.
• Street Markets: 
  • • Scheme to support the development of 100 weekly ‘haats’ or street food hubs in select cities each year for the next five years, building on the PM SVANidhi Scheme.
• Stamp Duty: 
  • • Encouragement for states with high stamp duty to moderate rates.
    • Consideration of further lowering duties for properties purchased by women.

Priority 6: Energy Security

• Energy Transition:
  • • Policy on energy transition pathways balancing employment, growth, and environmental sustainability will be introduced.
• PM Surya Ghar Muft Bijli Yojana: 
  • • Launched to install rooftop solar plants for 1 crore households to obtain free electricity up to 300 units per month.
    • Scheme has generated 1.28 crore registrations and 14 lakh applications.
• Pumped Storage Policy: 
  • • Promotion of pumped storage projects for electricity storage.
    • Facilitation of smooth integration of renewable energy into the overall energy mix.
• Small and Modular Nuclear Reactors:   Partnership with the private sector for:
  • • Setting up Bharat Small Reactors.
    • Research & development of Bharat Small Modular Reactor.
    • Research & development of newer technologies for nuclear energy.
• Advanced Ultra Super Critical Thermal Power Plants: 
  • • Development of indigenous technology for AUSC thermal power plants completed.
    • Joint venture between NTPC and BHEL to set up an 800 MW commercial plant using AUSC technology.
    • Government to provide fiscal support.
    • Development of indigenous capacity for high-grade steel and advanced metallurgy materials.
• Roadmap for ‘Hard to Abate’ Industries:
  • • Formulation of a roadmap for moving ‘hard to abate’ industries from ‘energy efficiency’ targets to ‘emission targets’.
    • Implementation of regulations for transition from ‘Perform, Achieve and Trade’ mode to ‘Indian Carbon Market’ mode.
• Support to Traditional Micro and Small Industries:
  • • Facilitation of investment-grade energy audits in 60 clusters, including brass and ceramic.
    • Provision of financial support for cleaner energy and energy efficiency measures.
    • Replication of the scheme in another 100 clusters in the next phase.

Priority 7: Infrastructure

• Infrastructure Investment by Central Government: 
• Fiscal Support: Commitment to maintain strong fiscal support for infrastructure over the next 5 years, balancing other priorities and fiscal consolidation.
• Capital Expenditure: Provision of ₹11,11,111 crore for capital expenditure, constituting 3.4% of GDP.
• Infrastructure Investment by State Governments:
  • • Support Encouragement: States encouraged to provide similar scale support for infrastructure, considering their development priorities.
    • Long-term Loans: Provision of ₹5 lakh crore for long-term interest-free loans to support states’ resource allocation.
• Private Investment in Infrastructure:
  • • Promotion: Investment by the private sector promoted through viability gap funding, enabling policies, and regulations.
    • Financing Framework: Introduction of a market-based financing framework.
• Pradhan Mantri Gram Sadak Yojana (PMGSY):
  • • Phase IV Launch: Launch of Phase IV to provide all-weather connectivity to 25,000 rural habitations with increased population.
• Irrigation and Flood Mitigation:
  • • Bihar Flood Control: Financial support for projects estimated at ₹11,500 crore, including Kosi-Mechi intra-state link and other schemes.
    • Assam Flood Assistance: Assistance for flood management and related projects.
    • Himachal Pradesh Rehabilitation: Assistance for reconstruction and rehabilitation through multilateral development assistance.
    • Uttarakhand Cloud Burst Relief: Assistance for losses due to cloud bursts and landslides.
    • Sikkim Flash Flood Relief: Assistance for recent flash floods and landslides.
• Tourism Development:
  • • Global Tourist Destination: Positioning India as a global tourist destination to create jobs, stimulate investments, and unlock economic opportunities.
    • Bihar Temples: Comprehensive development of Vishnupad Temple Corridor and Mahabodhi Temple Corridor in Bihar, modelled on Kashi Vishwanath Temple Corridor.
    • Rajgir Development: Comprehensive initiative for Rajgir, significant for Hindus, Buddhists, and Jains.
    • Nalanda: Development of Nalanda as a tourist centre and revival of Nalanda University.
    • Odisha Tourism: Assistance for development of Odisha’s temples, monuments, wildlife sanctuaries, natural landscapes, and beaches.

Priority 8: Innovation, Research & Development

• Research and Innovation:
• Anusandhan National Research Fund: Operationalization of the fund for basic research and prototype development.
• Private Sector Research: Establishment of a mechanism to spur private sector-driven research and innovation at a commercial scale with a financing pool of ₹1 lakh crore.
• Space Economy:
• Expansion Goal: Commitment to expanding the space economy by 5 times in the next 10 years.
• Venture Capital Fund: Creation of a venture capital fund of ₹1,000 crore to support this expansion.

Priority 9: Next Generation Reforms

• Economic Policy Framework: 
  • • • A new framework will be formulated to delineate the approach to economic development. 
• Collaboration with States: Effective implementation of reforms will require collaboration between the Centre and states, promoting competitive federalism and incentivizing states for faster implementation of reforms through a significant portion of the 50-year interest-free loan.
• Rural Land Actions:
  • • Unique Land Parcel Identification Number (ULPIN) for all lands.
    • Digitization of cadastral maps.
    • Survey of map sub-divisions as per current ownership.
    • Establishment of land registry.
    • Linking to the farmers registry to facilitate credit flow and other agricultural services.
• Urban Land Actions:
  • • Digitization of land records with GIS mapping.
    • Establishment of an IT-based system for property record administration, updating, and tax administration to improve the financial position of urban local bodies.
• Labour-Related Reforms: 
• Services to Labour: Comprehensive integration of the e-shram portal with other portals for a one-stop solution for employment and skilling services.
  • • Open architecture databases for the labour market, skill requirements, and available job roles.
    • Shram Suvidha & Samadhan Portal: Revamp of these portals to enhance ease of compliance for industry and trade.
• Capital and Entrepreneurship Reforms:
  • • Financial Sector Vision and Strategy: A document will be prepared to meet the financing needs of the economy, guiding the government, regulators, financial institutions, and market participants for the next 5 years.
    • Climate Finance Taxonomy: Development of a taxonomy for climate finance to enhance capital availability for climate adaptation and mitigation, supporting the country’s climate commitments and green transition.
    • Variable Capital Company Structure: Legislative approval will be sought for this structure to provide efficient and flexible financing for leasing aircrafts and ships, and pooled funds of private equity.
    • FDI and Overseas Investment: Simplification of rules and regulations for Foreign Direct Investment and Overseas Investments to facilitate foreign investments, nudge prioritization, and promote the use of the Indian Rupee for overseas investments.
    • NPS Vatsalya: Launch of a plan for parents and guardians to contribute to the National Pension Scheme for minors, with seamless conversion to a normal NPS account upon reaching adulthood.
• Ease of Doing Business:
  • • Jan Vishwas Bill 2.0: Further enhancement of the Ease of Doing Business.
    • State Incentives: Incentives for states to implement their Business Reforms Action Plans and digitalization.
    • Data and Statistics:
    • Data Governance: Improvement of data governance, collection, processing, and management using technology tools and sectoral databases established under the Digital India mission.
• New Pension Scheme (NPS):
  • • NPS Review Committee: Progress by the committee to address relevant issues while maintaining fiscal prudence to protect the common citizens.
• Budget Estimates 2024-25:
  • • Receipts and Expenditure: Total receipts (excluding borrowings) estimated at ₹48.07 lakh crore and total expenditure at ₹48.21 lakh crore.
    • Net Tax Receipts: Estimated at ₹25.83 lakh crore.
    • Fiscal Deficit: Estimated at 4.9% of GDP.
    • Borrowings: Gross and net market borrowings through dated securities estimated at ₹13.01 lakh crore and ₹11.63 lakh crore, respectively.
    • Fiscal Consolidation: Commitment to reach a fiscal deficit below 4.5% next year and maintain a declining Central Government debt path as a percentage of GDP from 2026-27 onwards.

Indirect Taxes

• Medicines and Medical Equipment: 
  • • Cancer Medicines: Full exemption from customs duties on three additional cancer medicines: Trastuzumab Deruxtecan, Osimertinib, Durvalumab. 
    • Medical X-ray Equipment: Changes in the Basic Customs Duty (BCD) on x-ray tubes and flat panel detectors for medical x-ray machines under the Phased Manufacturing Programme to synchronize with domestic capacity addition.
• Mobile Phone and Related Parts:
  • • Reduction in Basic Customs Duty (BCD): Reduction in BCD on mobile phones, mobile PCBA, and mobile chargers to 15% to benefit consumers. 
• Critical Minerals:
  • • Customs Duty Exemptions: Full exemption on customs duties for 25 critical minerals, with reduced BCD on two of them (silicon quartz and silicon dioxide, BCD has been reduced from 5-7.5% to 2.5%.).
    • Critical Mineral Mission: The government will set up a Critical Mineral mission for domestic production, recycling of critical minerals, and overseas acquisition of critical mineral assets. 
• Solar Energy: 
  • • Expanded Exemptions: Expansion of the list of exempted capital goods for manufacturing solar cells and panels.
    • Customs Duty on Solar Glass and Tinned Copper: Non-extension of customs duty exemptions due to sufficient domestic manufacturing capacity.
• Marine Products: 
  • • BCD Reduction: Reduction of BCD on certain broodstock, polychaete worms, shrimp, and fish feed to 5%.
    • Customs Duty Exemptions: Customs duty on inputs for manufacture of shrimp, fish feed, leather goods, textile and apparel and footwear have also been exempted.
• Leather and Textile: 
  • • Competitiveness Enhancement: Reduction of BCD on real down filling material from duck or goose.
    • Exemptions: There will be no duty on wet white, crust, and finished leather for manufacture of garments, footwear and other leather products for exports.
    • Duty Inversion Rectification: Reduction of BCD on methylene diphenyl diisocyanate (MDI) for manufacturing spandex yarn from 7.5% to 5%.
    • Export Duty Structure: Simplification and rationalization of the export duty structure on raw hides, skins, and leather.
• Precious Metals: 
  • • Gold and Silver: Reduction of customs duties on gold and silver to 6% and on platinum to 6.4% to enhance domestic value addition in gold and precious metal jewellery.

• Other Metals: 
  • • Production Cost Reduction: Removal of BCD on ferro nickel and blister copper.
    • Continuation of Nil BCD: Continuation of nil BCD on ferrous scrap and nickel cathode, and concessional BCD of 2.5% on copper scrap.
• Electronics: 
  • • Value Addition: Removal of BCD on oxygen-free copper for manufacturing resistors, subject to conditions.
    • Chemicals and Petrochemicals:
    • BCD Increase: Increase in BCD on ammonium nitrate from 7.5% to 10% to support existing and new capacities in the pipeline.
• Plastics:
  • • BCD Increase: Increase in BCD on PVC flex banners from 10% to 25% to curb imports of non-biodegradable and hazardous materials.
• Telecommunication Equipment:
  • • BCD Increase: Increase in BCD from 10% to 15% on PCBA of specified telecom equipment to incentivize domestic manufacturing.
• Trade Facilitation: 
  • • Export and Re-import Extensions: Extension of the export period for goods imported for repairs from six months to one year, and the time limit for re-import of goods for repairs under warranty from three to five years, to promote domestic aviation and boat & ship maintenance, repair, and overhaul (MRO).

See more: Budget 2024 For India By Finance Minister | UPSC

Direct Taxes:

• Simplification for Charities and TDS: 
• Merging Tax Exemption Regimes: Two tax exemption regimes for charities merged into one.
  • • Merging 5% TDS rate into 2% TDS rate.
    • Withdrawal of 20% TDS rate on mutual funds or UTI repurchase.
    • Reduction of TDS rate on e-commerce operators from 1% to 0.1%.
    • Credit of TCS in the TDS deducted on salary.
    • Decriminalization of delay in TDS payment up to the due date of filing statements.
• Simplification of Reassessment: 
  • • Reopening and Reassessment: Reopening beyond three years if escaped income is ₹ 50 lakh or more, up to five years.
    • In search cases, reducing the time limit from ten years to six years before the year of search.
• Simplification and Rationalization of Capital Gains:
  • • Short-term Gains: Short Term Capital Gains (STCG) tax on some assets will be increased from 15% to 20%
    • Long-term Gains: Long Term Capital Gains (LTCG) tax on all financial and non-financial asset will be hiked from 10 to 12.5% Increased exemption limit on capital gains on certain financial assets to ₹ 1.25 lakh per year.
    • Classification as long-term Gains: Listed financial assets held for more than a year, unlisted financial assets, and non-financial assets held for at least two years.
    • Tax on capital gains at applicable rates for unlisted bonds, debentures, debt mutual funds, and market-linked debentures irrespective of holding period.
• Taxpayer Services: 
  • • Digitalization: All major GST taxpayer services and most Customs and Income Tax services digitalized. Remaining services to be digitalized over the next two years.
• Litigation and Appeals: 
  • • Reducing Pendency: Deploying more officers for first appeals, proposing Vivad Se Vishwas Scheme, 2024.
    • Monetary Limits for Appeals: Increase monetary limits for filing appeals related to direct taxes, excise and service tax in the Tax Tribunals, High Courts and Supreme Court to Rs 60 lakh, Rs 2 crore and Rs 5 crore, respectively.
• Employment and Investment: 
  • • Abolishing Angel Tax: For all classes of investors to bolster the start-up ecosystem.
    • Cruise Tourism: Simpler tax regime for foreign shipping companies operating domestic cruises. Fixed profit and gains of cruise-ship operators to 20% of aggregate amount received.
    • Diamond Industry: Safe harbour rates for foreign mining companies selling raw diamonds in India.
    • Corporate Tax Rate: Tax rates for foreign companies will be slashed to 35% from current tax rate of 40%.
• Deepening the Tax Base: 
  • • Security Transactions Tax: The government increased the STT on sale of security option from 0.0625% to 0.1%, while tax levied on futures was increased from 0.0125% to 0.02%, in Budget 2024.
    • Increase to 0.02% on futures and 0.1% on options.
    • Buyback Tax: Tax income received on buyback of shares in the hands of the recipient.
• Other Proposals: 
  • • NPS Contributions: NPS limit for employers in the private sector is raised from 14% to 10% of the employee’s basic salary.
    • Non-reporting Penalties: Indian professionals working in multinationals get ESOPs and invest in social security schemes and other movable assets abroad. De-penalizing non-reporting of movable assets abroad up to ₹ 20 lakh under the Black Money Act. 
• Finance Bill Proposals:
  • • Withdrawal of equalization levy of 2%.
    • Expansion of tax benefits to certain funds and entities in IFSCs.
    • Immunity from penalty and prosecution for benamidar on full and true disclosure.
• Personal Income Tax: 
  • • Standard Deduction: Standard deduction to salaried individuals and pensioners is proposed to be increased from ₹ 50,000 to₹  75,000 under the new tax regime.
    • Family Pension Deduction: Deduction from family pension of Rs. 15,000 is proposed to be increased to ₹  25,000 under the new tax regime. 
• Tax Rate Structure (New Regime):

• • • As a result of these changes, a salaried employee in the new tax regime stands to save up to ₹ 17,500/- in income tax.