February 2, 2021 9:02:27 am
The Big Story
The government will embark on a massive expenditure push to boost the economy that has been wracked by the Covid-19 pandemic, but which is showing signs of recovery. The spending push is directed towards infrastructure sectors including roads and highways, railways, textiles, metro trains, health and water supply.
The public health care system received a booster shot with an allocation of Rs 64,180 crore for upgrading infrastructure. Under the new expenditure head called “health and well-being”, the total expenditure was pegged at Rs 2,23,846 crore — an increase of 137 per cent — including Rs 35,000 crore for immunisation with Covid vaccines.
In a bold move, the government has increased the FDI limit in the insurance sector from 49 per cent to 74 per cent. Raising the FDI limit has faced political opposition in the past, with the UPA failing to push a related bill through Parliament. Higher FDI is seen as exposing the sector to the possibility of sudden pullout of funds by foreign companies and putting hard-earned savings of policy holders at risk.
What makes Budget 2021-22 one of the boldest Budgets of the Modi regime? The government has taken a call to push reforms that have traditionally been a political hardsell. Raising the FDI limit in the insurance sector, LIC going public and privatisation of two public sector banks will need legislative measures and will bring the confrontation to Parliament. Others like disinvestment in non-strategic and strategic sectors could also set off protests by employees and unions.
Senior citizens above the age of 75, who only have pension and interest income, are now exempted from filing their income tax returns.
Around 100 Twitter accounts and 150 tweets related to the farmers’ protests went off the microblogging platform as the IT Ministry directed Twitter to remove these accounts. Among the accounts that were suspended include those of Kisan Ekta Morcha and Bhartiya Kisan Union (Ekta Ugrahan), The Caravan magazine, Prasar Bharti CEO Sashi Shekhar Vempati, and actor Sushant Singh.
Tikri border, one of the farmer protest sites, has become increasingly fortified. As of Monday, there were several layers of security — two heavy layers of metal barricading; a layer of large stone boulders; followed by the layer of nails, and a layer of concrete barricades.
Poll-bound states including West Bengal and Kerala got a big infrastructure push in the Budget. For West Bengal, the government announced 675 km of highway work at the cost of Rs 25,000 crore, including the upgradation of the Kolkata-Siliguri highway.
Keeping in line with the government’s push for a more self-reliant India, the Union Budget focussed on boosting domestic production in a variety of key sectors by hiking customs duties on final goods, bringing down costs of imported raw materials and reviewing “old exemptions”.
# The Myanmar military grabbed power in a coup on Monday (February 1) morning, ahead of a scheduled meeting of the country’s newly elected Parliament.
# The government on Monday proposed a cess on 17 commodities, ranging from gold and silver to imported agricultural products.
# The government has also proposed to tax the interest income on all PF contributions above Rs 2.5 lakh each year beginning April 1, 2021.
# The Home Ministry has been allocated in excess of Rs 1.66 lakh crore in the Union Budget for 2021-22, marginally lower than the allocation of Rs 1.67 lakh crore last year.
# About a crore old vehicles, currently in circulation, will go off the roads as the Centre on Monday announced a voluntary vehicle scrapping policy in the Budget.
Flower petals, balloons, red carpet, kheer in mid-day meal — that’s how the tiny tots were welcomed as the schools reopened for pre-primary and classes 1 and 2 in Punjab on Monday after a gap of nearly 10 months.
In this podcast episode, Udit Misra, who writes on the economy for the Indian Express, unpacks the budget to understand the ways in which it does and doesn’t address these problems, and discusses its biggest highlights.
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