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Budget 2019 HIGHLIGHTS: Chidambaram calls budget insipid, terms Sitharaman speech as opaque

Budget 2019 HIGHLIGHTS: Finance Minister Nirmala Sitharaman presented the full-fledged Union Budget for the current financial year Friday where she proposed reforms in several sectors including PSBs, tax returns and railways.

Written by Sonakshi Awasthi , Shreya Baldwa , Shreyasi Jha | New Delhi | Updated: July 5, 2019 11:52:43 pm
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Budget 2019 HIGHLIGHTS: India’s first woman Union Finance Minister in almost five decades, Nirmala Sitharaman briefed the press shortly after presenting the full-fledged Union Budget for the current financial year Friday where she proposed reforms in several sectors including PSBs, tax returns and railways. “Emphasis is on the overall development of the economy and we are focusing on the ease of living,” the Finance Minister said addressing a press conference. laying focus on the Non-Banking Financial Companies (NBFC), Sitharaman told the media that NBFCs are a critical component of our banking system and the government has adopted a comprehensive approach for NBFC financing.

Sitharaman proposed a Re 1 per litre cess on petrol and diesel prices, and hiked customs duty on gold and precious metals to 12.5 per cent from 10 per cent. She also said that Aadhaar card can be used in place of PAN for filing income taxes now. Also, from the current fiscal year, Rs 2-5 crore taxable income will see effective tax rate rising by 3 per cent and total effective tax rate will be higher by 7 per cent for those with a taxable income of over Rs 5 crore. She also said that the government has proposed a Rs 70,000 crore capital infusion into government-owned banks this year.

 

Sitharaman also said, “The Government is working towards ‘Har Ghar Jal’ by 2024, 10,000 new farmer producer organisations will be set up, 9.6 crore toilets have been constructed since October 2014, New Space India Limited (NSIL) has been incorporated to tap the benefits of ISRO.” “Railway infrastructure would need an investment of Rs 50 lakh crore between 2018 and 2030. We are looking to implement one nation, one grid in the power sector,” she said.

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Meanwhile, calling it a “Green Budget”, PM Modi said, “This Budget provides an assurance to its citizens that we are in the right direction. This Budget fulfils the expectations of 21st century India.” However, Adhir Ranjan Chowdhury, Leader of Congress in Lok Sabha, said, “Nothing new, repetition of old promises. They are talking about new India but the budget is old wine in a new bottle.”

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Finance Minister Nirmala Sitharaman presents Modi government's first Budget after winning the Lok Sabha elections. Follow HIGHLIGHTS on Budget 2019. Read in Tamil, Malayalam, Bangla 

21:26 (IST)05 Jul 2019
MoS Finance Thakur lists projects under Modi govt, says money will come from us

Ministry of State Finance Anurag Thakur said, "Under Pradhan Mantri Gram Sadak Yojana, over 1 lakh 25 thousand kilometer of roads are to be constructed in Phase-3 of the program. Also, 1 cr 95 lakh pakka houses are to be constructed in villages. It will strengthen the rural India. No tax on income below Rs 5 lakh, discount for middle class people on affordable housing, discount on electrical vehicles, from where will all that money come? It'll have contributions from all of us."

20:21 (IST)05 Jul 2019
Health sector: Rs 62,398 cr outlay; Rs 6,400 cr earmarked for AB-PMJAY

The health sector received Rs 62,659.12 crore, the highest in the last two financial years. An increase of around 19 per cent was seen. The budgetary allocation for the sector is Rs 60,908.22 crore, with Rs 6,400 crore earmarked for the centre's flagship health insurance scheme Ayushman Bharat- Pradhan Mantri Jan Arogya Yojna (AB-PMJAY). The AB-PMJAY is a flagship scheme of the Union government that aims at providing annual health cover of up to Rs 5 lakh per family for secondary and tertiary care hospitalisation to over 10.74 crore vulnerable families (approximately 50 crore beneficiaries).

20:17 (IST)05 Jul 2019
Marginal increase in allocation for CBI

The Central Bureau of Investigation (CBI) has been allocated Rs 781.01 crore under the new budge, a marginal increase of Rs 2.08 crore from last year. "The provision is for the establishment-related expenditure of the CBI which is entrusted with investigation and prosecution in corruption cases against public servants, private persons, firms and other cases of serious crimes," the Budget document said, PTI reported.

19:49 (IST)05 Jul 2019
FM chose to steady singles, keep run-rate moving: Anand Mahindra

Hoping the finance minister would "hit some boundaries" with the new budget, Chairman of the Mahindra Group Anand Mahindra said she instead chose to steady singles and keep the run-rate moving. "Despite expectations of big moves to instantly crank-up the economy she decided to keep her eye firmly on the long term," Mahindra said. He said that instead of lowering GST on all cars, Sitharaman aligned with the vision for mobility and incentivised only EVs. "But the measures for the financial sector are indeed big moves & could lubricate the engines of the economy. The one-time cover for pooled assets is an efficient solution for NBFC liquidity. The target for disinvestment is welcome. Now we need swift implementation," Mahindra said.

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19:28 (IST)05 Jul 2019
Uttarakhand BJP calls budget 'visionary, aspirational'

Uttarakhand BJP called the budget visionary and aspirational. "It (Budget) is aspirational and visionary. The sectoral allocations made in the Budget are in accordance with the development strategy adopted by the Centre for achieving the target of making India a five trillion dollar economy as spelt out in its economic survey," pradesh BJP spokesman Munna Singh Chauhan said.

Puducherry Lieutenant Governor Kiran Bedi too hailed the budget saying 'it is a bottom-up inclusive budget', PTI reported. She said that the budget will take the country towards 'greater transparency through extensive use of technology with increased accountability.'

19:17 (IST)05 Jul 2019
Expert speaks: 'Expect easing in bond yields in coming months'

"Budget 2019 was important one as it was being presented on the backdrop of visibly slowing global economic growth and closer home as well. Most certainly this would need some stimulus to revive the investment cycle, which could mean slippage on the fiscal front. Some small amount of slippage could actually have been pardoned by the markets. The fact that the gross government borrowing remains unchanged is an extremely positive move. The MPC has already moved into accommodative policy on rates front and with the government not breaching the line of fiscal discipline, it spells good news for bond markets. We could expect further easing in bond yields in the coming months," says Lakshmi Iyer, Chief Investment Officer (Debt) & Head Products of Kotak Mahindra Asset Management Company.

18:59 (IST)05 Jul 2019
Budget 2019 is completely visionless: Mamata

"#Budget2019 is completely visionless. In fact, the total vision is derailed. On top of it, not only have they imposed cess but also special additional excise duty on petrol and diesel leading to price increase by nearly Rs 2.50/litre for petrol and Rs 2.30/litre for diesel. As a result, price hikes will hit from transport to market to kitchens. Commoners are suffering and suffering."

18:47 (IST)05 Jul 2019
Expert speaks: 'Rental housing through creation of model law is welcome move'

“The new government’s first budget lays fundamental thrust on infrastructure development and affordable housing. Its attention to rental housing through creation of a model law is a welcome move and we hope this will pave way for the development of an institutional rental market in the country. The budget has also taken note of some of the key challenges of the real estate market in terms of the ongoing NBFC crisis and the tough residential market. We hope that the measures of enhancing bank funding to the NBFC sector and tax incentives around affordable housing will help the cause,” says Shishir Baijal, Chairman & Managing Director at Knight Frank India.

18:43 (IST)05 Jul 2019
Not once FM mentioned plight of farmers, budget against youth, farmers: Cong

Congress spokesperson Randeep Surjewala raised issue with the budget hitting out on the income of farmers and employment. "The budget is against people, youth, poor and farmers. Finance Min not even once mentioned about the plight of farmers. She didn't mention about 'how the income of farmers will be doubled?' or 'how employment will be generated," Surjewala asked. 

18:33 (IST)05 Jul 2019
Delhi Metro gets Rs 400 crore, allocation rises by 10% in Environment

Delhi Metro has been given a grant of Rs 414.70 crore in the new budget as against Rs 50 crore in the last fiscal. The Ministry of Housing and Urban Affairs has been allocated Rs 17,713.93 crore for executing metro projects across the country, which was Rs 14,864.60 crore in the revised Budget of the previous fiscal.

Allocation for the Environment Ministry has been increased from the last fiscal by 10.4 per cent to Rs 2,954.72 crore. Termed as the "green budget" by Prime Minister Narendra Modi, Rs 460 crore was allocated towards pollution control schemes including National Clean Air Programme.

18:20 (IST)05 Jul 2019
Expert speaks: 'Budget marks beginning of new India, will add pace to economic development'

“Union Budget 2019 definitely marks the beginning of the new India. It will give a much needed boost to the Indian travel and tourism sector. With the ongoing UDAN scheme for common man, we can expect better air connectivity, improved infrastructure and bridging of the gap between rural and urban sectors. Another visionary project ‘Sagarmala’ will enhance waterways and port connectivity that will uplift cruise tourism in India. As the government understands the need to invest and improve infrastructure, I am sure this budget will add pace to the economic development of the nation.” said Anil Parashar President & CEO of InterGlobe Technology Quotient.

18:15 (IST)05 Jul 2019
Union Budget will only help capitalists: Mayawati

BSP supremo Mayawati said the Union government tried to make it alluring and it would only help the capitalists. "It has to be seen as to how this Budget of theirs is actually beneficial for the people of the country at the ground level," she said in a tweet, adding that the entire country was "distraught and harassed" by poverty, unemployment, poor educational and health facilities. The BSP chief further said the Budget would "encourage the private sector and help big capitalists" at every level, further "complicating" the issue of reservation for the Dalits and backwards besides problems of inflation, poverty and unemployment.

18:12 (IST)05 Jul 2019
Expert speaks: 'Better growth with macro-economic stability will be ideal outcome'

“It is encouraging that the fiscal deficit target has been revised downwards from 3.4 per cent to 3.3 per cent. Strengthening PSU banks’ capital and improving RBI’s oversight on the financial sector will likely improve the flow of credit in the economy. A series of measures to enhance capital flows and employment generation are also great steps. Better growth with macro-economic stability will be the ideal outcome," says Jatin Dalal, Senior Vice President and Chief Financial Officer of Wipro Limited.

18:02 (IST)05 Jul 2019
Sitharaman is a woman, nation expects many things: Ex-Karanataka Siddaramaiah

Former chief minister of Karnataka and Congress leader Siddaramaiah calls points out Sitharaman is a woman and " women of the nation expected many things, but they have not been fulfilled". Unhappy with the budget, Siddaramaiah says it is against development and there is no pro-farmers issue in the budget.  "People had expectations from Budget 2019, but they're unhappy. They promised growth in the farming sector, which remained false. Farmers are not getting MSP, they are in drastic condition. There is no pro-farmers thing in budget. Union Budget 2019 doesn't have any program to curb unemployment problem, which is highest in the last 45 years. Also, Nirmala Sitharaman is a woman, women of the nation expected many things, but they have not been fulfilled," says the former Karanataka CM.

17:53 (IST)05 Jul 2019
Education:New policy to focus on research; Rs 400 cr allocated for building world-class institutes

The new budget allocated Rs 400 crore for setting up world-class education institutes and announced 'Study in India' programme that will aim at attracting foreign students to the country. Sitharaman said a new national education policy will be introduced to transform India's higher education system to one of the best in the world. The policy proposes major changes in both school and higher education, improve governance and gives more focus on research and innovation, for which a National Research Foundation (NRF) would be set up to coordinate and promote research in the country, she said.

17:48 (IST)05 Jul 2019
Expert speaks: 'One step closer to economic growth, look forward on improving AI, robotics'

“The Union Budget 2019 depicts the milestone set towards reaching USD 5 trillion economy by investing on infrastructure, digital economy and job creation. It brings us one step closer the economic growth as part of the five years plan with key focus on infrastructure development allocating budgets for roads, ports Infrastructure and logistics. We welcome the government’s focus on the construction and development of highways under the National Highways Programme, to ensure creation of National Highways Grid of desirable capacity. Also applaud the continued focus and investments towards rail infrastructure by announcing and an investment of 50 lakh crores.We also look forward to the focus on improving skills of our youth in areas such as Artifical Intelligence, Big Data, Robotics, This in turn will ensure more stability of jobs both in India and abroad. Furthermore, doubling allocation to Digital India will empower the semi-urban geographies and provide businesses to upscale and help in the country’s vision to a digital-first economy,” says Director of Axis Communications - India & SAARC Sudhindra Holla.

17:45 (IST)05 Jul 2019
Expert speaks: 'Infrastructure investments, skill development should lead to job creation'

"It has to be ensured that infrastructure investments and skill development should lead to job creation. This budget focuses on fundamentally important elements like affordable housing (additional tax incentives, as well as 1.95 cr rural houses under PM Awas Yojana leading to “housing for all” by 2022), disinvestment (Rs.1.05 tn target for FY20), environment (promoting manufacturing and purchase of electric vehicles), rural development (“Har Ghar Jal”), and social security (pension benefits extended to 3 cr shop owners). There is also a credible effort to aid fundamentally sound NBFCs with partial credit guarantee for PSBs investing in their securitized assets. Some areas could have done with more attention. For example, while the above-expectation Rs.700 bn PSB recap plan is welcome, one would have expected concrete steps for governance reforms in banks. One would have also expected specific measures to induce growth in long-term financial savings of households, which are critical for long-term investments," says G. Murlidhar, MD & CEO of Kotak Life Insurance. 

17:36 (IST)05 Jul 2019
Modi 2.0 government's maiden Budget disappointing, lacks direction: Gehlot

Rajasthan Chief Minister Ashok Gehlot called the budget "disappointing" saying that it lacked direction and had no clear purpose. In a slew of tweets, Gehlot said the budget speech did not mention anything about agriculture and it reflects that the government is not at all serious about improving conditions in rural sector. "The finance minister did not mention various budgetary allocations in her speech, which has been part of past budget speeches," he said. "Gaon, Gareeb and Kisaan are mentioned as mere slogans without any concrete schemes to deal with farm distress. No relief to middle class or salaried class either. On top of it, raising fuel prices will put further burden on common people," he wrote.

17:26 (IST)05 Jul 2019
Expert speaks: 'Few highs for real estate in a cautious budget'

"As far as real estate is concerned, the budget had a few hits and several misses. Infrastructure stayed at the top of the government’s agenda. This is of course significant, since infra development is one of the main propellers for economic growth and real estate benefits both directly and indirectly. The new FM had an uphill task of balancing priorities in Modi 2.0's maiden budget. Most sectors - including real estate - stridently sought concessions to kick-start stagnant consumption and investments. Steering the country out of the stranglehold of economic slowdown and creating employment were also high on the priorities list," says Anuj Puri, Chairman of ANAROCK Property Consultants. 

17:24 (IST)05 Jul 2019
Gold prices zoom Rs 590 on custom duty hike

Custom duty on precious metals has been increased from 10 per cent to 12.5 per cent. Simple put, price o gold has shot up by Rs 590 per 10 gram in Delhi. This move will make gold and jewellery expensive in the domestic market.

Budget 2019 India LIVE Updates: Finance Minister Nirmala Sitharaman arrives at her office before leaving for Parliament to present the Budget 2019 in New Delhi (Reuters)

On the FDI in India, the Finance Minister said, "FDI inflows remained strong in 2018-19 marking a 6 per cent growth. Govt will invite suggestions for further opening up of FDI in the aviation sector, media, animation AVGC and insurance sectors in consultation with all stakeholders. 100 per cent FDI will be permitted for insurance intermediaries."

On banking and finance, Sitharaman said, "The government has proposed a Rs 70,000 crore capital infusion into government-owned banks this year. With the bad loan cycle almost bottoming out according to the Reserve Bank of India, this should help banks to lend more this fiscal. Non-performing asset (NPAs) recovery of Rs 4 lakh crore over the last four years, NPAs down by Rs 1 lakh crore in the last one."

Listing out the achievements of NDA, Sitharaman said, "The recent election was charged with brimming home and desire for a bright and stable 'New India'." Talking about the economy, the Finance Minister said, "The Indian economy will grow to become a $3 trillion economy in the current year itself. We can very well reach 5 trillion dollars in the next few years. It is now the sixth largest in the world. Five years ago it was at the 11th position."

Thanking the voters for bringing back Modi government to power for a second term, Sitharaman said, "The people of India have validated their two goals for our country's future: national security and economic growth. Between 2014 and 2019, we provided rejuvenated centre-state dynamic, cooperative federalism, GST Council and a strident commitment to fiscal discipline; set the ball rolling for New India."

READ | Union Budget 2019 Highlights: Cargo movement in Ganga to increase 4 times in four years | Govt to liberalise FDI in aviation, media, single brand retail, says Sitharaman | New space PSU likely to replace Antrix Corporation 

As Sitharaman presents the full-fledged Union Budget for the current financial year, she faces the arduous task of living up to the expectations of the voters who have returned the BJP-led government with a resounding majority and also balancing the economy.

As she delivers her maiden Budget, the twin challenges for Sitharaman are to spur growth and create more jobs. The Budget is being presented at a time when unemployment had touched a 45-year high, and India had lost its tag as the world’s fastest-growing major economy to China in the last quarter of the fiscal year.

The Budget is expected to boost spending at the cost of short-term slippage in fiscal deficit targets as she lays down the Modi 2.0 government's road map for the economy and the nation in the next five years. Some believe she may give relief to the common man by raising personal income tax threshold for certain categories while at the same time, upping spending on agriculture, healthcare and social sectors.

A push is also expected in sectors like infrastructure, education, health and railways.

In the backdrop of BJP's historic mandate in the recent Lok Sabha polls, the citizens are hopeful that the full-year Budget would further expand the welfare measures announced in the interim Budget. But with India's economic growth faltering since February 1, it would likely be much more difficult to come through on those promises.

In the Economic Survey presented to Parliament Thursday, the government projected the economic growth to inch up to 7 per cent. It also laid emphasis on private investment and accelerating the GDP growth rate to 8 per cent to turn India to turn into a $5-trillion economy by 2025.