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Union Budget 2017 Overview

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Bank & Insurance > SBI PO > General Awareness

Akansha Jigyasu
SHARED INFO Yesterday, 12 pm Bank & Insurance

Union Budget 2017 Overview


Finance Minister, Arun Jaitleyhas now announced the Union Budget
2017. We are now providingthe highlights of the Budget 2017.

Here are the highlights of Finance Minister's speech during Budget


presentation -

IMF estimates that World GDP will grow by 3.4 per cent in 2017.
CPI inflation declined from 6% in July 2016 to 3.4% in December,
2016and is expected to remain within RBIs mandated range of 2%
to 6%.
Indias Current Account Decit declined from about 1% of GDP last
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year to 0.3% of GDP in the rst half of 2016-17.
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Foreign Direct Investment (FDI) increased from 1,07,000 crores in
the rst half of last year to 1,45,000 crores in the rst half of 2016-
17.
As on 20th January 2017, Foreign Exchange Reserves are at $361
billion.
India has become the sixth largest manufacturing country in the
world, up from ninth previously.
Two major policy decisions taken by Government this year
-Passage of the Constitution Amendment Bill for GST as well as
theprogress for its implementation and Demonetization of high
denomination bank notes.
He mentioned about three major reforms involved in the Budget
2017-18. These are -
(a) The presentation of the Budget has been advanced to 1st
February to enable the Parliament to avoid a Vote on Account and
pass a single Appropriation Bill for 2017-18, before the close of the
current nancial year, whichwould enable the Ministries and
Departments to operationalise all schemes and projects, including
the new schemes, right from the commencement of the next
nancial year.
(b) Discontinuing the colonial practice prevalent since 1924,
Railways Budget has been merged with the Union Budget.
(c)The plan and non-plan classication of expenditure.
He also mentioned that Government'sagenda for the next year is -
Transform, Energize and Clean India, that is, TEC India.
He also mentioned that Budget will be focused on the following
major themes -
Farmers
Rural population
Youth
Poor and underprivileged health care
Infrastructure
Financial
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on Gradeup for stronger institutions
Speedy accountability
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Public services
Prudent scal management
Tax administration for the honest

Highlights of Union Budget 2017

Farmers -

Agriculture is expected to grow at 4.1% in the current year.


For the nancial year 2017-18, the target for agricultural credit to
farmers has been xed at a record level of Rs. 10 lakh crorewith 60
days interest waiver.
Government will support NABARD for computerization and
integration of all 63,000 functional PACS (Primary Agriculture Credit
Societies) with the Core Banking System of District Central
Cooperative Banks which will be done in 3 years at an estimated
cost of Rs. 1,900 crores, with nancial participation from State
Governments.
The coverage of Fasal Bima Yojana will be increased from 30% of
cropped area in 2016-17 to 40% in 2017-18 and 50% in 2018-19. The
Budget provision for this scheme has been increased from Rs. 5,500
crores to Rs. 13,240 crores to settle the arrears claims.
Government will set up new mini labs in Krishi Vigyan Kendras
(KVKs) and ensure 100% coverage of all 648 KVKs in the country.
1000 mini labs will be set up by qualied local entrepreneurs.
Government will also provide credit linked subsidy to these
entrepreneurs.
A Long Term Irrigation Fund has already been set up in NABARD.
Addition of Rs. 20,000 crores to its corpus was also announced
which will take the total corpus of this Fund to Rs. 40,000 crores.
Micro Irrigation Fund will be set up in NABARD to achieve the goal,
per drop more crop which will have an initial corpus of Rs. 5,000
crores.
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coverage National Agricultural Market (e-NAM) will be
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current 250 markets to 585 APMCs (Agriculture
Produce Market Committee).
A Dairy Processing and Infrastructure Development Fund would be
set up in NABARD with a corpus of Rs. 8,000 crores over 3 years.
Initially, the Fund will start with a corpus of Rs. 2,000 crores.

Rural Population -

Government will undertake Mission Antyodaya to bring 1 crore


households out of poverty and to make 50,000 Gram Panchayats
poverty free by 2019.
The target of 5 lakh farm ponds and 10 lakh compost pits
announced in the last Budget from MGNREGA funds will be fully
achieved.
It is expected that about 10 lakh farm ponds would be completed by
March 2017 against 5 lakh farm ponds earlier.
Participation of women in MGNREGA has increased to 55% from
less than 48% in the past.
Budget provision under MGNREGA (Mahatma Gandhi National Rural
Employment Guarantee Act) has been increased to Rs. 48,000
crores in 2017-18 against Rs. 38,500 crores in 2016-17, i.e. the
highest ever.
Sum of Rs. 19,000 crores allocated for Pradhan Mantri Gram Sadak
Yojana (PMGSY) in 2017-18. Together with the contribution of
States, an amount of Rs. 27,000 crores will be spent on PMGSY in
2017-18.
Proposal to complete 1 crore houses by 2019 for the houseless and
those living in kutcha houses was also introduced.
Amountallocated for Pradhan Mantri Awaas Yojana Gramin will be
stepped up from Rs. 15,000 crores in 2016-17 to Rs. 23,000 crores
in 2017-18.
Government also expects toachieve 100% village electrication by 1
st May 2018. An increased allocation of Rs. 4,814 crores has also
been proposed under the Deendayal Upadhyaya Gram Jyoti Yojana in
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2017-18.
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Proposal to increase the sum allocated for Deendayal Antyodaya
Yojana- National Rural Livelihood Mission for promotion of Skill
Development and livelihood opportunities for people in rural areas to
Rs. 4,500 in 2017-18 has also been introduced.
The allocation for Prime Minister's Employment Generation
Programme (PMEGP) and credit support schemes has been
increased more than 3 times.
Proposal to provide safe drinking water to over 28,000 arsenic and
fluoride affected habitations in the next four years has been
introduced which will be a sub mission of the National Rural
Drinking Water Programme (NRDWP).
Mason training will be provided to 5 lakh persons by 2022 for
imparting new skills to the people in the rural areas.
The total allocation for the rural, agriculture and allied sectors in
2017-18 is Rs. 1,87,223 crores, which is 24% higher than the
previous year.

Youth -

An Innovation Fund for Secondary Education will be created to


encourage local innovation for ensuring universal access, gender
parity and quality improvement. This will include ICT enabled
learning transformation. The focus will be on 3479 educationally
backward blocks.
In higher education, reforms will be undertaken in UGC. Good quality
institutions would be enabled to have greater administrative and
academic autonomy.
Colleges will be identied based on accreditation and ranking, and
given autonomous status. A revised framework will be put in place
for outcome based accreditation and credit based programmes.
SWAYAM platform will be launched with at least 350 online courses.
Access to SWAYAM will also be widened by linkage with DTH
channels, dedicated to education.
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Proposal toestablish a National Testing Agency as an autonomous
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premier testing organisation to conduct all
entrance examinations for higher education institutions has also
been introduced which would free CBSE, AICTE and other premier
institutions from these administrative responsibilities so that they
can focus more on academics.
Pradhan Mantri Kaushal Kendras (PMKK) will beextended to more
than 600 districts across the country.
100 India International Skills Centres will be established across the
country.
Pradhan Mantri Kaushal Kendras (PMKK) have already been
promoted in more than 60 districts. We now propose to extend these
Kendras to more than 600 districts across the country.
100 India International Skills Centres will be established across the
country.
Proposal to launch the Skill Acquisition and Knowledge Awareness
for Livelihood Promotion programme (SANKALP) has also been
introduced at a cost of Rs. 4,000 crores. SANKALP will provide
market relevant training to 3.5 crore youth.
The next phase of Skill Strengthening for Industrial Value
Enhancement (STRIVE) will also be launched in 2017-18 at a cost of
Rs. 2,200 crores.
A special scheme for creating employment in the textile sector has
already been launched. Similar schemes will be launched in the
leather and footwear sectors.
Incredible India 2.0 Campaign will be launched across the world.

Poor and underprivileged health care -

Mahila Shakti Kendra will be set up at village level with an allocation


of Rs. 500 crores in 14 lakh ICDS Anganwadi Centres.
Fund allocated for the welfare of Women and Children under various
schemes across all Ministries will be stepped up from Rs. 1,56,528
crores in 2016-17 to Rs. 1,84,632 crores in 2017-18.
Affordable housing will now be given infrastructure status, which
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will enable these projects to avail the associated benets.
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The National Housing Bank will renance individual housing loans of
about ` 20,000 crore in 2017-18.
Government has prepared an action plan to eliminate Kala-Azar and
Filariasis by 2017, Leprosy by 2018 and Measles by 2020.
Elimination of tuberculosis by 2025 is also targeted.
1.5 lakh Health Sub Centres will be transformed into Health and
Wellness Centres.
Two new All India Institutes of Medical Sciences (AIIMS) will be set
up in the States of Jharkhand and Gujarat.
Legislative reforms will be undertaken to simplify, rationalize and
amalgamate the existing labor laws into 4 Codes on - wages,
industrial relations, social security and welfare as well as safety and
working conditions.
The fund allocation for the welfare of Scheduled Castes has been
stepped up from Rs. 38,833 crores in 2016-17 to Rs. 52,393 crores in
2017-18
The allocation for Scheduled Tribes has been increased to Rs.
31,920 crores and for Minority Affairs to Rs. 4,195 crores.
For senior citizens, Aadhar based Smart Cards containing their
health details will be introduced.
LIC will implement a scheme for senior citizens to provide assured
pension, with a guaranteed return of 8% per annum for 10 years.

Infrastructure -

Railways Budget -

Rs. 1,31,000 crore allocated for Railways for total capital and
development expenditure in 2017-18, which also includes Rs. 51,000
crore from the government.
For passenger safety, a Rashtriya Rail Sanraksha Kosh will be
created with a corpus of ` 1 lakh crores over a period of 5 years.
Unmanned level crossings on Broad Gauge lines will be eliminated
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by 2020.
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Railway lines of 3,500 kms will be commissioned in 2017-18, as
against 2,800 kms in 2016-17.
Steps will be taken to launch dedicated trains for tourism and
pilgrimage.
500 stations will be made differently abled friendly by providing lifts
and escalators.
Proposal to feed about 7,000 stations with solar power in the
medium term has been introduced.
Proposal for Coach Mitra facility, a single window interface, to
register all coach related complaints and requirements has been
introduced. Bio-toilets for all coaches of the Indian Railways will be
provided by 2019.
Railways will also implement end to end integrated transport
solutions for select commodities through partnership with 18
logistics players.
Railways will offer competitive ticket booking facility to the public at
large. Service charge on e-tickets booked through IRCTC has been
withdrawn.
A new Metro Rail Policy will be announced with focus on innovative
models of implementation and nancing.

Aviation and Road Transport -

Budget allocation for Highways will be stepped up from Rs. 57,976


crores in 2016-17 to Rs. 64,900 crores in 2017-18.
Select airports in Tier 2 cities will be taken up for operation and
maintenance in the PPP mode.
Total fund of Rs. 2,41,387 crores will be allocated for transportation
sector as a whole, including rail, roads, shipping in 2017-18.
Allocation for BharatNet Project will be increased to Rs. 10,000
crores in 2017-18.
High speed broadband connectivity on optical bre will be available
in more than 1,50,000 gram panchayats by the end of 2017-18.
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A DigiGaon initiative will be launched to provide tele-medicine,
4.6 education and skills through digital technology.
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Government has decided to set up Strategic Crude Oil Reserves for
strengthening our Energy sector, . 2 more reserves will be set up at
Chandikhole in Odisha and Bikaner in Rajasthan for this.
Fund allocation for incentive schemes like M-SIPS and EDF has been
increased to Rs. 745 crores in 2017-18.
Trade Infrastructure for Export Scheme (TIES), a new and
restructured Central scheme will be launched in 2017-18.
The total allocation for infrastructure development in 2017-18
stands at Rs. 3,96,135 crores.

Financial sector -

Foreign Investment Promotion Board (FIPB) will be phased out in


2017-18 and a roadmap for the same will be announced in the next
few months.
Multi State Cooperative Societies Act, 2002 will be amended in
consultation with various stakeholders, as part of the Clean India
agenda.
A Computer Emergency Response Team for Financial Sector (CERT-
Fin) will be established.
The Government will put in place a revised mechanism and
procedure to ensure time bound listing of identied CPSEs on stock
exchanges.
The shares of Railway PSEs like IRCTC, IRFC and IRCON will be
listed in stock exchanges
In lines with the Indradhanush roadmap, Rs. 10,000 crores for
recapitalisation of Banks will be provided in 2017-18. Additional
allocation will be provided if required.
Lending target of Pradhan Mantri Mudra Yojana will be set at Rs.
2.44 lakh crores for 2017-18.

Digital Economy -

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lakh peopleApp
have adopted the BHIM app so far. The Government
4.6 will launch two newInstall
schemes to promote the usage of BHIM -
Referral Bonus Scheme for individuals and a Cashback Scheme for
merchants.
Aadhar Pay, a merchant version of Aadhar Enabled Payment System,
will be launched shortly.
A Mission will be set up with a target of 2,500 crore digital
transactions for 2017-18 through UPI, USSD, Aadhar Pay, IMPS and
debit cards.
Government will undertake a comprehensive review of Payment and
Settlement Systems Act and bring about appropriate amendments.
Proposal to create a Payments Regulatory Board in the Reserve
Bank of India by replacing the existing Board for Regulation and
Supervision of Payment and Settlement Systems has been
introduced.

Public Service -

Head Post Ofces will be utilised as front ofces for rendering


passport services.
A Centralised Defence Travel System has been developed through
which travel tickets can be booked online by our soldiers and
ofcers.
A comprehensive web based interactive Pension Disbursement
System for Defence Pensioners will be established.
A system will be introduced for single registration and two tier
system of examination for our citizens to avoid the cumbersome
procedures of Government recruitment.

Prudent scal management -

The total expenditure in Budget for 2017-18 has been placed at Rs.
21.47 lakh crores.
Allocation for Capital expenditure has been stepped up by 25.4%
over the previous year.
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Provision of Rs.App
3,000 crores under the Department of Economic
4.6 Affairs will be made to implement various Budget announcements
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and other 26 new schemes in 2017-18. For Defence expenditure
excluding pensions, sum of Rs. 2,74,114 crores including Rs. 86,488
crores for Defence capital will be allocated. Allocation for Scientic
Ministries will be increased to Rs. 37,435 crore in 2017-18.
Fiscal decit for 2017-18 pegged at 3.2 percent of GDP
anditstarget for next three years pegged at 3 percent.
Revenue Decit of 2.3% in 2016-17 stands reduced to 2.1% in the
Revised Estimates.The Revenue Decit for next year is pegged at
1.9%.

Tax Proposals -

Against the estimated 4.2 crore persons engaged in organised


sector employment, the number of individuals ling return for salary
income are only 1.74 crore.
Against 5.6 crore informal sector individual enterprises and rms
doing small business in India, the number of returns led by this
category are only 1.81 crore.
Of the 76 lakh individual assesses who declare income above ` 5
lakh, 56 lakh are in the salaried class.
The number of people showing income more than ` 50 lakh in the
entire country is only 1.72 lakh.
During the period 8th November to 30th December 2016, deposits
between ` 2 lakh and ` 80 lakh were made in about 1.09 crore
accounts with an average deposit size of ` 5.03 lakh.
Tax to be levied for unoccupied houses a year after getting
completion certicateon notional rental income.
Capital Gains Tax holding period will be reduced from 3 years to 2
years for real estate.Also, the base year for indexation is proposed
to be shifted from 1.4.1981 to 1.4.2001 for all classes of assets
including immovable property.
Concessional with-holding rate of 5% is charged on interest earned
by foreign entities in external commercial borrowings or in bonds
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and Government securities. This concession period will be extended
4.6 to 30.06.2020 fromInstall
30.6.2017.
MAT (Minimum Alternate Tax) will carry forward upto a period of 15
years instead of 10 years at present.
Income tax for smaller companies with annual turnover upto Rs. 50
crore will be reduced to 25%.
Proposal to increase allowable provision for Non-Performing Asset
from 7.5% to 8.5% has also been introduced.
Basic customs duty on LNG will be reduced from 5% to 2.5%.
Proposal to limit the cash expenditure allowable as deduction, both
for revenue as well as capital expenditure to Rs. 10,000 has been
introduced.
Limit of cash donation which can be received by a charitable trust
will be reduced from Rs. 10,000/- to Rs. 2000/-.
Special Investigation Team (SIT) has suggested that no transaction
above Rs. 3 lakh should be permitted in cash.
List of donors who contributed more than Rs. 20,000/- to any party
in cash or cheque is required to be maintained.
The maximum amount of cash donation that a political party can
receive will be `2000/- from one person and they will be entitled to
receive donations by cheque or digital mode from their donors.
Proposal to increase the threshold limit for audit of business
entities who opt for presumptive income scheme from Rs. 1 crore to
Rs. 2 crores has been introduced.
The threshold for maintenance of books for individuals and HUF will
be increased from turnover of Rs. 10 lakhs to Rs. 25 lakhs or income
from Rs. 1.2 lakhs to Rs. 2.5 lakhs.
TDS of 5% will be deducted from commission payable to individual
insurance agents even if the income of some of them may be below
taxable limit.
The time period for revising a tax return will be reduced to 12
months from completion of nancial year.

Personal Income Tax -

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Proposal App the existing rate of taxation for individual
to reduce
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income of Rs. 2.5 lakhs to Rs. 5 lakhs to 5% from
the present rate of 10% has been introduced.
To avoid duplication of benet, the existing benet of rebate
available to the same group of beneciaries is being reduced to Rs.
2500 available only to assessees upto income of Rs. 3.5 lakhs.
The combined effect of both these measures will mean that there
would be zero tax liability for people getting income upto Rs. 3 lakhs
p.a. and the tax liability will only be Rs. 2,500 for people with income
between Rs. 3 and Rs. 3.5 lakhs.
While the taxation liability of people with income upto `5 lakhs is
being reduced to half, all the other categories of tax payers in the
subsequent slabs will also get a uniform benet of `12,500/- per
person.
Proposal to levy a surcharge of 10% of tax payable on categories of
individuals whose annual taxable income is between Rs. 50 lakhs
and Rs. 1 crore has been introduced.
Simple one-page form to be led as Income Tax Return for the
category of individuals having taxable income upto `5 lakhs other
than business income will be introduced.

Finance Minister spoke for about 1 hour and 50 minutes.


You can also read about the interesting facts related to Budget from the
link below -

Budget Trivia

All the best for your Exams..


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