The Government of India had proclaimed the Budget 2021 which had led many parties and individuals to have dissension on it. From this budget, many sectors will get benefits and others might face strain out of it. The budget 2021 was presented in a digital way with the assist of a tablet which marks that India is leading into the next level of digitalization which made that disparate from that of the other budgets. Many news channels cast debates on this and thus it seems difficult for any individual to know whether this budget is equitable for the Indians.
Let us discuss each pro & Cons related to Budget 2021 so that we can have a clear idea about it.
- In this budget, Health Care was given more importance due to the COVID-19 crisis and thus a major step was taken to boost the Indian health sector widely. The health sector got 2.2 lakh crore rupees so that they can improve the quality of health care facilities and be ready if other crises up-come in the future. From this 2.2 lakh crore fund most of it must be utilized for the production and supply of COVID-19 vaccine which seems to be a good action and plan taken by the Indian Government.
- The government had come with many schemes and policies for new companies so that they can motivate them for new start-up plans. The government came with a Production-Linked Incentive Schemes (PLI Scheme) which stated that the more you increase your production; the more will you get benefits on your taxes. With the help of this scheme, many new companies might swell their production and thus increases the employment rate for the country. The companies might also get the benefits from the Tax Holiday policy which can let them get away from taxes about 2-3 years from the date of the start-up of their company, from this many investors might start investing their money into the market to get benefits out of it.
- The major employment seen in India is from farm and Textile industries, but these industries are unorganized as in this sort of industries salary, timing & holidays are never fix because they fully depend on the demand of the market, whereas 16% jobs are been offered by Railway and it is a class of organized sector, due to this reason the textile industry was given importance from that of the others so that the employment rate can increase up to some extent.
- The government had added 2 lakh companies into Micro, Small & Medium Enterprise (MSME). The companies which get adjoin into MSME gets more welfare from the government with different sorts of scheme added into it and they had to do less paperwork as compared to that of the others, thus adding this company will increase the employability rate into the country.
- In Insurance Sector, the government had increased the FDI rate by 74% and thus seeks a good step as it will swell the insurance sector and also increases the employment rate.
- Nowadays the burden on banks had increased a lot hence keeping this in mind government come up with a Non-Performing Asset policy so that instant and stern action could be taken on that individual who doesn’t pay-up their loans to the bank. Earlier the government rules were not so good & strict thus banks had to suffer a lot, but now if a person not repaying a loan more than 20 lakh rupees will be undertaken into severe action within no time. The government had made a fund of 20,000 crores for the banks so that they can withdraw it when seen necessary. One point that was also added is that if a bank drowns out due to some circumstances then you can withdraw a maximum amount of five lakh from that bank and the rest of your money will be repaid back within sort of time period, this will lead people to deposit money into banks and will also get good benefits out of it. The government had also decided to merge two banks but the names of them are not yet declared.
- The Non-Resident Indian (NRI) have been told by the Indian government that they can start a Person Company in India if they want, this might help for many new start-up plans across the country and thus will also boost the employment rate within the country itself.
- In India the electricity distribution board seems distinct in many cities and thus try to manipulate people as per their rules, the government had decided to go up for many electricity distribution companies so that it can help the common people to choose the electricity board that suits them well.
- The senior citizens with an age limit of more than 75 were made free from paying Income Tax Return (ITR); this will help them to some extent and thus seems to be a good decision from their point of view.
- The vehicles which are 20 years old cause a lot of pollution hence they will be banned soon and will help increase the demand for automobiles in the future.
- Mobile and its parts, automobile, and its parts & other electric and electronic gadgets will be cost higher as the tax on them are increased by few percentages.
- The government has also increased the tax on solar panels which might prove wrong as the solar panel is said to future of electric generation system hence adding tax to it will take individuals away from it.
- Fruits, whole grains, cotton will get more costly than before.
- Tax on alcoholic products had been increased which seems to be a good step for better future development.
- The tax on urea used by farmers had also grown up and thus seems to increase the burden on farmers.
- Taxes on metals such as gold, silver, brass, copper, steel, etc. will be reduced to some extent.
- An e-portal will be made for the laborers so that they can register over there so that they can get their job easily. This might take time but doing so will help labor a lot as they have to migrate a lot in search of jobs.
- The budget of education had decreased from 99,000 crores to 93,000 crore rupees and had also added 18% G.S.T. onto it which seems to be a very disappointing decision ever taken from an educational point of view.
- The Minimum Support Price (MSP) for sugarcane has increased from rupees 3.3/kg to rupees 3.5/kg.
- The defense sector got 4 lakh, 80 thousand crore rupees which seem very less as compared to that of China.
- The railway sector is allotted with 1 lakh crore rupees fund into it which is a satisfactory amount onto it.
- The government had work a lot on infrastructures and mostly in road transportation and decided to build 8500km express highways and targeted to build of 22km highway on a daily basis which is a good step for road transport connectivity.
What are the sources that add ups-to Government income?
This sort of question arises in everyone’s mind that from where such huge amount of fund adds up into Governments account. Let us discuss the income and expenditures of the Indian Government in brief.
- Government 36% income is generated by taking a loan from WTO, World Bank, IMF, Asian Development bank, etc. or from developed countries like USA, Japan, etc. and thus add ups a huge amount into its income.
- Goods and Services Taxes (G.S.T.) adds up to 15%.
- 14% of it is generated by Income Tax Return (ITR).
- Corporation Tax adds up to 13% into it which is generated through huge multi-national companies.
- The loan taken from different banks and countries led to the payment of 20% of interest which seems to be a very huge amount.
- 16% is divided into different states for the welfare of individuals.
- Many policies and schemes are made up by the government thus it charges up to 14% of the total expenditure.
Disinvestments are done by the Indian Government
Most of us think that the government is privatizing many things, but the fact is that the government is disinvesting its thing rather than privatizing which are both different phenomena. The things that government is unable to handle are taken-over by others so that some sort of revenue can be generated through it.
- Railway has a huge amount of useless land with it and thus government decided to give this land on rent so that some amount revenue can be generated. The spares which aren’t in use by the railway are also to be sold so that it could be used by the other party in need and thus helping to increase the revenue for the country.
- The government is disinvesting some part of LIC, Air India to draw some sort of revenue from it and tries to get out of this burden of handling it.
- BPCL is said to be very profitable and thus government decided to disinvest some part of it to other private groups to generate huge revenue through it.
- Electricity Transmission lines are also to be privatized and thus this will be helpful for the citizens to get electricity facilities and services on time.