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Major Highlights of the Union Budget 2021-22 (Part-2): Pillars to Energise the Economy

This Finance Minister Nirmala Sitharaman unveiled the Union Budget 2021-22 on the first day of February 2021. With a tablet computer, the finance minister delivered the first-ever paperless budget address. The budget has a much greater significance considering the pandemic that caused economic distress. In this article, we shall cover the six pillars of budget proposals, and it may be noted that this article is in continuation to the Part 1 of the Union Budget 2021-22.

6 Pillars of Budget 2021-22 Proposals

The Union budget 2021-22 focuses on six pillars for reviving the economy:

• Health and Well being;
• Inclusive development for aspirational India;
• Physical and Financial Capital and Infrastructure;
• Reinvigorating Human Capital;
• Innovation and R&D; and
• Minimum Government and Maximum Governance.

Now let’s take a look at each one of them in detail.

Health and Well Being

A significant investment has been made to the health infrastructure, and the budget outlay for Health and Well Being is 2, 23,846 crore rupees in BE 2021-22 as against this year’s BE of 94,452 crore, an increase of 137%.

Further, the finance minister announced the initiation of a new centrally sponsored scheme named PM Swasth Bharat Yojana. This will be launched with an outlay of about 64, 180 crore rupees over six years.

It is expected to meet the following goals:

• Develop capacities of primary, secondary, and tertiary care health systems;
• Strengthen already existing national institutions; and
• Create new institution to cater to the detection and cure of new diseases.

Some of the main interventions of the scheme are as follows:

• Support for numerous rural and urban health and wellness centres;
• Setting up integrated public health labs and 3382 block public health units in 11 states;
• Establishing critical care hospital blocks in numerous districts and 12 central institutions;
• Strengthening of the National Centre for Disease Control and its regional branches and also 20 metropolitan health surveillance units;
• Expansion of the integrated health information portal to all states/union territories to connect all public health labs;
• Operationalization of 17 new public health units and strengthening of 33 existing public health units at points of entry;
• Setting up of 15 health emergency operation centres and 2 mobile hospitals; and
• Setting up a national institution for one health.

Vaccines

Provision of 35,000 crore rupees has been made for the Covid-19 vaccine by the government and committed to provide more if required.

Physical and Financial Capital and Infrastructure

The finance minister said projects for building 8,500 km of highways shall be awarded by March 2022. The majority of these projects shall be in the four poll bound states of India. West Bengal will witness highway projects worth 25,000 crore rupees, and highway projects worth 65,000 crore will be undertaken in Kerala, whereas 3400 crore rupees is allocated for road projects in Assam. In the urban areas, 18,000 crore rupees scheme has been announced to augment public transport.

Infrastructure financing- Development financial institution

A bill to set up Development financial institution^[1] will be introduced. The government has provided a sum of 20,000 crore rupees to capitalize this institution.

Petroleum and Natural Gas

With respect to Petroleum and Natural Gas, the following initiatives have been announced:

• Extension of Ujwala scheme;
• More districts to be added to City Gas Distribution Network;
• Gas pipeline project in Jammu and Kashmir; and
• Setting up of independent gas transport system operator.

Disinvestment

In a critical announcement, the finance minister stated that in the Atmanirbhar package there shall be a policy of strategic disinvestment of PSUs, and she further asserted that the government has approved the same.

Inclusive Development for Aspirational India

The finance minister claimed that the government is committed to the welfare of farmers. To provide adequate credit to farmers, the government has raised the agricultural credit target to 16.5 lakh crore rupees in FY 22. In a critical announcement to boost the value addition in agriculture and their exports, the scope of Operation Green Scheme will be enlarged.

Financial Inclusion

With a view to facilitate credit flow under the Stand up India scheme for SCs, STs, and women, the government proposed to reduce the margin money requirement to 15%, and in this budget 2021-22, the government has provided 15,700 crore to this sector.

 Reinvigorating Human Capital

The finance minister proposed to set up a Higher Education Commission of India. Further, for accessible higher education in Ladakh, the government has proposed to set up a central university.

Skilling

An initiative is underway to benchmark skill qualifications, assessment, and certification in partnership with the UAE. The government also has a collaborative training inter training programme between India and Japan.

Innovation and R&D

 Government is all set to undertake all new initiative called the National Language Translation Mission, which will enable the wealth of governance related knowledge to be made available in major Indian languages.

The New Space India Limited a PSU under the Space Department will execute the PSLV-CS51 launch carrying the Amazonia Satellite from Brazil.

As part of the Gaganyaan mission, four Indian astronauts are trained on Generic Space Flight aspects in Russia. The first unmanned launch is slated for later this year.

Minimum Government and Maximum Governance

Steps will be taken for the reformation of the tribunals for delivering speedy justice. The national commission for allied health care professional bill has been introduced, and National Nursing and Midwifery Commission bill will be introduced to bring transparency and efficiency.

Further, the finance minister has also proposed to provide 1000 crore rupees for tea workers welfare in Assam and West Bengal.  A special scheme will be devised for it.

Conclusion for Budget 2021-22

The Finance Minister also announced that the government plans to continue the path of fiscal consolidation and desire to reach a fiscal deficit level below 4.5% of GDP by the year 2025-26. For information on direct and indirect tax proposal of Budget 2021-22, kindly refer to the first part of the article. 

Read our article:Major Highlights of the Union Budget 2021-22 (Part-1): Direct & Indirect Tax Proposals