The Union Budget is the annual budget of the Indian Republic. It is presented every year in the month of February generally by the Union Finance Minister. In this page, you can read all about what a budget is, and what to expect in the Union Budget 2021-22. This is an important topic for the UPSC Civil Services Prelims and Mains exam 2021.
The Union Budget 2021-22 is the first Budget of the new decade and the first paperless budget. It is also the third one that follows a contraction in the economy.
Union Budget – Introduction
The Union Budget is also known as the Annual Financial Statement. Article 112 of the Constitution of India lays down that it is a statement of the estimated expenditure and receipts of the Government for a particular year.
- The Budget keeps the account of the finances of the government for the fiscal year (from 1st April to 31st March).
- The Budget is presented on 1st February (until 2016, it was presented on the last working day of February) so that it can materialise before the commencement of the new financial year which starts on 1st April.
- In 2017, a 92-year-old tradition was broken when the railway budget was merged with the Union Budget and presented together.
- The Budget has to be passed by the Lok Sabha before it can come into effect.
- The Union Budget is divided into Revenue Budget and Capital Budget. For more on these terms, check Union Budget – Important Economic Terms.
- In the Union Budget, the disbursements and receipts of the government comprise the various types of government funds in India namely, the Consolidated Fund of India, the Contingency Fund and the Public Account.
The Economic Survey of India is released ahead of the presentation of the Budget. This document is prepared under the guidance of the Chief Economic Advisor and is presented for discussion in both Houses during the Budget session.
Union Budget 2021 Highlights:
FM Nirmala Sitharaman presents Union Budget 2021-22: This will be the first paperless budget and first one to be presented after the COVID-19 pandemic.
List of Important Schemes in Union Budget 2020-21: PM Atmanirbhar Swasth Bharat Yojana, Mission Poshan 3.0
Atmanirbhar Bharat Package
The Finance Minister during the beginning of her budget speech recalled the launch of Atmanirbhar Bharat package to provide stimulus to the Indian economy. Prime Minister Narendra Modi had announced the launch of Atmanirbhar Bharat Abhiyan on May 12, 2020. The special economic package worth Rs 20 lakh crore was launched with an objective to make India self-reliant. During his address to the nation, the Prime Minister had urged people to be vocal about local.
Part A- Vision for Atmanirbhar Bharat – Six Pillars
The Budget 2021-12 rests on six pillars —health & well-being, physical & financial capital & infrastructure, inclusive development for aspirational India, reinvigorating human capital, innovation & R&D, Minimum Govt & Maximum Governance.
1. Health and Well Being
A) PM Atmanirbhar Swasth Bharat Yojana: PM Atmanirbhar Swasth Bharat Yojana to be launched to strengthen existing health systems and support future health interventions with an outlay of about 64,180 crores over 6 years.
-Establishing 7000 rural and 11000 urban wellness centres
-Setting up of health labs
-establishing critical care hospital
-strengthening of national disease control
-expansion of integrated health portal
establishing 17 new public health units
-to connect all public health labs
-strengthening of existing of public health units
B) Mission Poshan 3.0
C) Jal Jivan Urban Mission
D) Urban Swacch Bharat Mission
E) Clean Air Programme
F) Voluntary Vehicle Scrapping Policy to reduce vehicular pollution-vehicles will undergo fitness tests after 20 years in private vehicles, 15 years in case of commercial vehicles.
G) New vaccine roll out
2. Physical and Financial Capital & Infrastructure
A) Mega Investment Textile Parks- 7 textile parks will be created
B) Propose sharp increase in Capital expenditure: The Finance Minister has proposed a sharp increase in Capital Expenditure & thus have provided Rs 5.54 lakh crores which is 34.5% more than the BE 2020-21.
C) Roads & Highways -3500 km of national highway work in Tamil Nadu. The construction will start next year. -1500 km of national highway work in Kerala including 600 km stretch of Mumbai-Kanyakumari corridor. – national highway work in West Bengal at a cost of Rs 25000 crore-national highway work of more than 34000 crore covering 300 kms
D) Railway Infrastructure – National Railway Plan- Western & Eastern dedicated freight corridors to be commissioned soon.-High Density network to be provided with train protection to prevent train collision incidents.
E) Urban Infrastructure– New scheme to be launched to support augmentation of public bus service. it will boost automobile sector and create employment opportunities for the youth and enable smooth mobility to citizens-Metro lite to be deployed- central funding will be provided to Kochi Metro Phase II.
Union Budget 2021 to go paperless for first time since Independence
The Budget will be like never before and will be delivered in a paperless format. No hard copies of the Budget 2021 will be printed due to the COVID-19 pandemic. The Union Budget 2021 will go paperless this year for the first time since India’s Independence. The Budget will be like never before and will be delivered in a paperless format. No hard copies of the Budget 2021 will be printed due to the COVID-19 pandemic.
The Finance Ministry has launched the ‘Union Budget app’ to enable smooth access to Budget-related documents. The app can be easily downloaded from the app store in both Android and Apple smartphones. All documents will be available for download after the Finance Minister’s speech at the Parliament.
The Union Budget is printed every year in the finance ministry’s in-house press, involving around 100 employees of the ministry who have to stay together for almost 15 days till the papers are printed, sealed and delivered on the day of the Budget. The tradition will not be followed this year for the first time, taking into consideration the Covid-19 pandemic and the peak in the number of cases again. The government has decided to share soft copies of the Budget instead.
• The Budget papers including both the Union Budget and Economic Survey will not be printed and soft copies will be provided.
All members of the Parliament will receive the soft copies of the Union Budget.
• In a significant development, the Finance Ministry launched the ‘Union Budget’ app during the symbolic ‘Halwa Ceremony to enable users to easily download and access budget documents.
• This is not the first time that there would be a change in tradition in the budget presentation under Finance Minister Nirmala Sitharaman.
• She had previously done away with the colonial-era tradition of carrying Budget papers in a briefcase and introduced the Budget ‘Bahi Khata’ or a ledger, enclosed in a red cloth folder and tied with a string.
Finance Minister Nirmala Sithraman has proposed introduction of Aatmanirbhar Swastha Bharat health program with an outlay of Rs. 64,180 crores, this will act as an addition to the existing National Health Mission.
Finance Minister has given the main pillars of Union Budget 2021-22:
– Health and well-being
– Physical and financial capital and infrastructure
– Inclusive development for aspirational India
– Reinvigorating human capital
– Innovation and R&D
– Minimum government and maximum governance
Mission Poshan 2.0
The government will be launching Mission Poshan 2.0, Jal Jeevan Mission Urban will be introduced. Finance Minister said that ” The urban Swachh Bharat Scheme will be implemented with an outlay of over Rs. 1.4 lakh crore.
Vehicle Scrapping Policy
The government has launched the voluntary scrapping policy in order to remove unfit/ outdated vehicles from the streets. Passenger vehicles beyond 20 years and commercial vehicles beyond 15 years will need to go through a vehicle fitness test.
Road development in Bengal gets Rs. 95,000 crore
Finance Minister Nirmala Sitharaman announced Rs. 95,000 crore for the development of roads in the state of Bengal. The still will conduct polls in coming months.
11,000 km of National highway infrastructure in 2021
Finance Minister Nirmala Sitharaman said that ” Government aims to complete 11,000 km of national highway infrastructure this year” Tamil Nadu gets a corridor of 3,500 km. Kerala will get 1,100 km which includes investment worth Rs. 65,000 crore. 675 km in West Bengal which costs Rs. 95,000 crore. 1,300 km in Assam promised over next three years.
Rs. 1.10 lakh crore allotted for Indian Railways
Finance Minister Nirmala Sitharaman announced Rs. 1.10 lakh crore to Indian Railways, Rs. 1.7 lakh crore is for the capital expenditure of the allotment.
Finance Minister Nirmala Sitharaman announced Central fiscal funding to Bangalore Metro, Chennai Metro, Nagpur Metro, Kochi Metro, Nashik Metro projects across the nation.
Rs. 3.05 lakh crore for Power sector
Finance Minister Nirmala Sitharaman announced Rs. 3.05 lakh crore for the power sector in the country. Finance Minister added that 100 more cities will be added to the Gas distribution network in the next three years.
Gas pipeline project in Jammu and Kashmir
Finance Minister Nirmala Sitharaman announced a brand new gas pipeline project for the development of Jammu and Kashmir.
Rs. 20,000 crore for Public sector banks
Finance Minister Nirmala Sitharaman announced further infusion of Rs. 20,000 crore for the public sector banks.
LIC IPO to launch this year
Finance Minister Nirmala Sitharaman said that “The government plans to sell part of holding in Life Insurance Corporation of India (LIC) through an initial public offering (IPO) in the coming year. An amendment to the existing Act to facilitate the public offer.”
Government committed to farmers welfare
Finance Minister Nirmala Sitharaman amid the protest from opposition leaders said that ” The government is committed to the welfare of farmers. The MSP has gone through a sea change. Over Rs. 75,000 crore paid to wheat farmers in the years 2020-21; 43.36 lakh farmers have benefitted from this.”
Government to push Ujjawala scheme
The government will be extending the benefits of the Ujjawala scheme to additional 1 crore people. Ujjawala scheme provides LPG connections with a financial subsidy from the central government. The scheme benefits 12 crore households right now and will be extended further to provide clean and cheap cooking fuel.
Agriculture credit target to Rs. 16.5 lakh crore
Finance Minister Nirmala Sitharaman proposes an increase in agriculture credit target to Rs. 16.5 lakh crore. Nirmala Sitharaman said that ” The MSP regime has undergone a change to assure price that is at least 1.5 times the cost of the production across all the commodities. The total amount paid to paddy farmers surged to Rs. 1.72 lakh crore on 2020-21.”
Disinvest target for FY2022 at Rs. 1.75 lakh crore
Finance Minister Nirmala Sitharaman puts disinvestment receipts at Rs. 1.75 lakh crore for the fiscal year beginning April 1, 2021. Two PSBs and one general insurance company to be disinvested, legislations and amendments to be introduced in this session.
National education policy
Finance Minister Nirmala Sitharaman said that “National Education Policy got a good reception. Over 15,000 schools to be qualitatively strengthened under National Education Policy.”
Rs. 1,500 crore for promotion of Digital Payments
Finance Minister Nirmala Sitharaman announced Rs. 1,500 crore for promoting a digital mode of payment.
Rs. 1000 crore for Assam, Bengal tea workers
Finance Minister Nirmala Sitharaman announced a special scheme for welfare of women and children in Assam and West Bengal. Finance Minister Nirmala Sitharaman announced Rs. 1000 for the tea workers in Assam and Bengal.
Rs. 3,768 crore for Census
Finance Minister Nirmala Sitharaman announced Rs. 3,768 for the census. The next census will be the first digital census in the history of Independent India.
Exemption for filling tax for elderly
Finance Minister Nirmala Sitharaman said ” In the 75th year of independence of our country, we shall reduce the compliance burden on senior citizens. For senior citizens who only have a pension and interest income, I propose exemption of filling of income tax returns.”
Features of the Union Budget Mobile App:
The app launched by the government has a user- friendly interface along with embedded features:
• Zoom in and out
• Bidirectional scrolling
• External links
• Table of content
• The app is also bilingual and the budget documents will be available in both English and Hindi
What documents will be available on the ‘Union Budget’ app?
According to the Finance Ministry, the mobile app launched by the central government will provide complete access to the 14 Union Budget Documents which will include the Demand for Grants (DG), Annual Financial Statement also known as Budget, Finance Bill, etc.
The Union Budget 2021-22 will be officially presented today by finance minister Nirmala Sitharaman. The Budget session of the Parliament began on January 29th with the President’s joint address to the Parliament and will conclude on April 8, 2021.
The Budget session will be held in two phases, first from January 29-February 15 and second from March 8- April 8. This is the first sitting of the parliament after the monsoon session of 2020, as the winter session of the parliament was cancelled due to rising cases of COVID-19 in the country.
Economic Survey 2020-21
The Economic Survey 2020-21 has projected that India’s real GDP growth to be 11.0% in FY 2021-22 and nominal GDP to be around 15.4%, which is the highest since independence.