Union Budget 2018-19: Focus on agriculture, employment, MSMEs
The Dollar Business Bureau
Guided by mission to strengthen agriculture, employment, rural development, health, education, MSMEs and infrastructure sectors, Finance Minister Arun Jaitley presented the Union Budget 2018-19 in Parliament on Thursday.
Reiterating the pledge given by the Government to the people of the country four years ago to give an honest, clean and transparent Government, Jaitley said that the Government under Prime Minister Narendra Modi has successfully implemented a series of fundamental structural reforms to propel India among the fastest growing economies of the world.
Jaitley said that India’s agri-exports potential is as high as $100 billion against current exports of $30 billion and to realise this potential, export of agri-commodities will be liberalised.
While presenting the Budget, he said, “Indian society, polity and economy had shown remarkable resilience in adjusting with the structural reforms. IMF, in its latest Update, has forecast that India will grow at 7.4% next year in the backdrop of services resuming high growth rates of 8% plus, exports expected to grow at 15% in 2017-18 and manufacturing back on good growth path.”
“This year’s Budget will particularly focus on strengthening agriculture and rural economy, provision of good health care to economically less privileged, taking care of senior citizens, infrastructure creation and working with the States to provide more resources for improving the quality of education in the country,” he said.
To promote creation of more jobs in the country and also to incentivise domestic value addition and Make in India in sectors such as food processing, electronics, auto components, footwear and furniture, Finance Minister has proposed changes in customs duty including increasing duty on mobile phones to 20% from 15% and cutting of custom duty on raw cashew from 5% to 2.5%.
With major focus on the strengthening agricultural sector and generating employment across various sectors, the Government announced several measures in the Union Budget 2018-19.
Some of the major highlights of the Budget are as follows:
- Customs duty on raw cashew cut from 5% to 2.5%.
- Custom duty on mobile phones increased to 20% from 15%, on some of their parts and accessories to 15% and on certain parts of televisions to 15%.
- To abolish the education cess and secondary and higher education cess on imported goods. In its place, it is proposed to impose a Social Welfare Surcharge at 10% of the aggregate duties of customs, on imported goods.
- Central Board of Excise and Customs (CBEC) renamed as Central Board of Indirect Taxes and Customs.
- National logistics portal as a single window online market place to be developed.
- On the lines of Operation Flood, a new scheme Operation Greens was announced with an outlay of Rs.500 Crore to address the challenge of price volatility of perishable commodities like tomato, onion and potato.
- Two new funds of Rs.10,000 crore for Fisheries and Animal Husbandary sectors; Re-structured National Bamboo Mission gets Rs.1290 crore.
- Disinvestment target of Rs.80,000 crore for 2018-19.
- Comprehensive Gold Policy on the anvil to develop yellow metal as an asset class.
- 100% deduction to companies registered as Farmer Producer Companies with an annual turnover upto Rs. 100 crore on profit derived from such activities, for five years from 2018-19.
- Proposal to extend reduced rate of 25% currently available for companies with turnover of less than Rs.50 crore to companies having up to Rs.250 crore, to benefit MSMEs.
- MSP for all unannounced kharif crops will be one and half times of their production cost like majority of rabi crops.
- Institutional Farm Credit raised to Rs.11 lakh crore in 2018-19 from Rs.8.5 lakh crore in 2014-15.
- Allocation of Ministry of Food Processing has been doubled from Rs.715 crore in 2017-18 to Rs.1400 crore in 2018-19.
- To boost employment and economic growth in MSMEs, a sum of Rs. 3794 crore has been provided for giving credit support, capital and interest subsidy and for innovations.
- An outlay of Rs.7148 crore for the textile sector in 2018-19 as against Rs.6,000 crore in 2016.
- Benefits under section 80-JJAA of the income-tax act extended to footwear and leather industry to help employment generation.
- Increase of budgetary allocation on infrastructure for 2018-19 to Rs.5.97 lakh crore against estimated expenditure of Rs.4.94 lakh crore in 2017-18.
- Railways Capital Expenditure for the year 2018-19 has been pegged at Rs.1,48,528 crore.
Continuing the Government’s focus on fiscal reduction and consolidation, the Finance Minister estimated a fiscal deficit of 3.3% of GDP for the year 2018-19. The revised fiscal deficit estimates for 2017-18 were put at Rs.5.95 lakh crore at 3.5% of GDP.