INTERIM BUDGET 2024: HIGHLIGHTS 

The practice of presenting a vote on account in India before a new government forms serves several crucial purposes:

• With elections often held close to the start of the fiscal year, there's limited time for a new government to formulate and garner parliamentary approval for a full budget. The vote on account provides a temporary spending plan to ensure essential government functions continue uninterrupted.
• Introducing a full budget before the new government takes charge would be seen as imposing the previous regime's policies on the incoming one. The vote on account avoids this by maintaining the status quo, allowing the new government to present a revised budget reflecting its own priorities and vision later.
• Without a spending plan, the government would face financial difficulties, potentially impacting public services and causing economic disruption. The vote on account bridges this gap, ensuring continuity and stability during the transition period.
• Since India's independence in 1947, the vote on account has become a well-established convention. This continuity provides predictability and facilitates smooth financial management during government changes.

3.1. Housing

• The government plans to launch a new housing scheme specifically targeting "deserving sections of the middle class" currently living in rented accommodations, slums, chawls, or unauthorized colonies. This scheme aims to empower them to purchase or build their own homes, potentially improving their living standards and financial security.
• To promote renewable energy and environmental sustainability, the government intends to enable one crore households to generate and utilize up to 300 units of free electricity per month through rooftop solarization. This initiative aligns with the Prime Minister's vision expressed during the historic consecration of Ram Mandir in Ayodhya, aiming for a cleaner and more self-sufficient future.
• Recognizing the growing demand for housing in rural areas, the PM Awas Yojana (Grameen) will be expanded to construct two crore additional houses in the next five years. This initiative addresses the needs of families and communities, fostering rural development and improved living conditions.

3.2. Healthcare

• The government announced a new vaccination program for girls aged 9-14 years against Human Papillomavirus (HPV), which can cause cervical cancer. This proactive step aims to safeguard the health of young women and reduce future cancer risks.
• To address the shortage of medical professionals, the government plans to create more medical colleges by leveraging existing hospital infrastructure within various departments. This strategy aims to increase the number of qualified doctors and improve healthcare accessibility.
• The "Saksham Anganwadi and Poshan 2.0" initiative will see further acceleration, focusing on upgrading Anganwadi centres, crucial for providing healthcare and nutrition services to young children and pregnant mothers.
• The U-WIN platform for managing immunization programs and the Mission Indradhanush immunization drive will be rolled out swiftly. This initiative aims to strengthen and expand immunization coverage, preventing childhood diseases and promoting public health.
• The government extends healthcare coverage under the Ayushman Bharat scheme to all ASHA workers, Anganwadi Workers, and Helpers. This move provides them with much-needed health insurance and financial protection.

3.3. Agriculture and Related Sector 

• The government plans to expand the application of Nano DAP, a fertilizer using nanotechnology, across various crops and agro-climatic zones. This aims to improve nutrient absorption and potentially increase crop yields.
• A strategic plan will be formulated to achieve "atmanirbharta" (self-sufficiency) in oilseeds, focusing on mustard, groundnut, sesame, soybean, and sunflower. This initiative aims to reduce reliance on imported oils and boost domestic production.
• A comprehensive program to support dairy farmers will be developed, leveraging the success of existing schemes like the Rashtriya Gokul Mission and National Livestock Mission. This aims to improve dairy farmers' income and increase milk production.
• The implementation of Pradhan Mantri Matsya Sampada Yojana (PMMSY) will be intensified to:

1. Increase aquaculture productivity from 3 to 5 tons per hectare.
2. Double fish exports to ₹1 lakh crore.
3. Generate 55 lakh employment opportunities.

• Five integrated aquaparks will be set up, combining fish farming with agriculture, potentially promoting sustainable and resource-efficient food production.

3.4. Empowering Women

• The Finance Minister acknowledged the significant role of Self-Help Groups (SHGs) in empowering rural women, highlighting their contribution to socio-economic transformation. This recognition underscores the government's awareness of the vital role SHGs play in women's financial independence and community development.
• The government aims to ambitiously increase the target of the "Lakhpati Didi" scheme from 2 crore to 3 crore women. This scheme empowers rural women by providing skill development training and facilitating their transition into entrepreneurs, aiming for an annual income of at least 1 lakh rupees. The expansion signifies the government's commitment to fostering women's economic participation and self-reliance on a larger scale.

• The budget aims to empower the "tech-savvy youth" by establishing a massive ₹1 lakh crore corpus offering 50-year interest-free loans. This initiative provides young entrepreneurs with access to long-term, low-cost financing to fuel their innovative ventures.
• The long repayment tenure (50 years) and low/zero interest rates offer significant benefits:

1. Young entrepreneurs can focus on investing in their businesses without worrying about high loan repayments.
2. The favourable loan terms allow for more experimentation and innovation.
3. Access to larger funds can support more ambitious and impactful ventures.

• A separate scheme that focuses on strengthening "deep-tech" technologies for defence purposes. This initiative aligns with the "atmanirbharta" (self-sufficiency) goal, aiming to:

1. Promote research and development in critical areas like artificial intelligence, robotics, and cyber security.
2. Foster domestic innovation and production of advanced defence equipment.
3. Equip the armed forces with cutting-edge technologies to enhance their capabilities.

The government has announced a significant increase in infrastructure spending for the next year, highlighting its commitment to developing this crucial sector. 

• The outlay for infrastructure development is being increased by 11.1% to a whopping ₹11,11,111 crore, representing 3.4% of the GDP. This substantial investment aims to accelerate infrastructure growth and improve connectivity across the nation.
• Three major railway corridor programs will be implemented:

1. Energy, mineral and cement corridors aim to improve transportation efficiency for key industrial resources, boosting economic activity in these sectors.
2. Port connectivity corridors will enhance connectivity between ports and hinterlands, facilitating smoother movement of goods and promoting international trade.
3. High-traffic density corridors will address congestion in high-traffic areas, improving overall logistics and reducing travel time.

• Multimodal Connectivity projects identified under the PM Gati Shakti initiative prioritize multimodal connectivity, ensuring seamless movement of goods and people across different modes of transportation (road, rail, air, waterways).
• The expansion of Metro rail networks and the NaMO Bharat program in large cities will focus on transit-oriented development (TOD). This approach integrates public transport with urban planning, promoting sustainable and livable cities.

• The budget announces the provision of viability gap funding for tapping into the offshore wind energy potential, emphasizing sustainable and clean energy sources.
• A forward-looking initiative aims to establish a coal gasification and liquefaction capacity of 100 MT by the year 2030, aligning with the commitment to reduce reliance on traditional energy sources.
• Financial assistance will be extended to facilitate the procurement of biomass aggregation machinery, promoting the utilization of biomass for energy generation.
• A phased approach towards the mandatory blending of compressed biogas (CBG) in compressed natural gas (CNG) for transport and piped natural gas (PNG) for domestic purposes will be instituted, emphasizing the transition to cleaner energy alternatives.
• The budget emphasizes support for the electric vehicle ecosystem, covering both manufacturing and charging infrastructure. This initiative aims to accelerate the adoption of electric vehicles for a more sustainable transportation system.
• A payment security mechanism will be introduced to encourage the greater adoption of electric buses in public transport networks, contributing to reduced emissions and enhanced environmental sustainability.
• To promote green growth, a new scheme for bio-manufacturing and bio-foundry will be launched. This initiative focuses on leveraging biological processes for manufacturing and fostering bio-based industries.
• The budget introduces Blue Economy 2.0, encompassing a scheme for restoration and adaptation measures, coastal aquaculture, and mariculture. This integrated and multi-sectoral approach aims to enhance the sustainable use of ocean resources while addressing environmental concerns.

The budget outlines a focused strategy to revitalize and promote domestic tourism in India, with several key initiatives:

• States will be encouraged to comprehensively develop iconic tourist destinations, encompassing branding and marketing them on a global scale. This aims to attract international tourists and enhance the overall tourism experience.
• A framework for rating tourist centres based on the quality of facilities and services will be established. This will ensure transparency and encourage continuous improvement, leading to a more attractive and satisfying tourist experience.
• Long-term, interest-free loans will be provided to states on a matching basis to finance the development of these iconic tourist centres. This financial assistance will act as a catalyst for infrastructure improvement and attract private investment.
• Recognizing the potential of island destinations, projects for port connectivity, tourism infrastructure, and amenities will be undertaken on various islands, including Lakshadweep. This aims to diversify the domestic tourism landscape and offer unique experiences to travellers.

The budget speech mentioned two key points regarding Foreign Direct Investment (FDI) in India:

• The government emphasized the significant increase in FDI inflow during 2014-23, highlighting it as a "golden era" with USD 596 billion received, doubling the inflow compared to 2005-14. This achievement suggests that India has become a more attractive destination for foreign investors in recent years.
• The government expressed its commitment to attracting further foreign investment through:

1. Negotiating bilateral investment treaties aims to create a more stable and predictable investment environment for foreign companies, potentially reducing risks and encouraging investment.
2. The "First Develop India" approach emphasizes attracting FDI that aligns with India's development priorities, potentially leading to technology transfer, job creation, and infrastructure development.

• The loan provides states with much-needed financial resources to undertake significant reforms, potentially overcoming budgetary constraints that often impede progress.
• The 50-year loan term offers flexibility and reduces pressure on immediate repayment, allowing states to invest in long-term reforms with lasting impact.
• The loan is likely tied to specific reform initiatives identified by the central government or mutually agreed upon. This ensures the funds are directed towards desired outcomes.

The revised estimates for the 2023-24 financial year offer insights into the government's updated projections for revenue, expenditure, and fiscal deficit. 

• Revenue

1. Total receipts excluding borrowings are estimated at ₹27.56 lakh crore, exceeding the budget estimate. This suggests stronger revenue collection, potentially due to better economic performance or improved tax administration.
2. Tax receipts are expected to reach ₹23.24 lakh crore, highlighting positive growth in tax collection.
3. Revenue from other sources like dividends and asset sales is also expected to be higher than initially projected.

• Total expenditure is revised to ₹44.90 lakh crore, indicating higher spending than initially planned. This could be due to unforeseen circumstances, increased spending on specific programs, or adjustments in accounting practices.
• Despite the higher expenditure, the revised fiscal deficit stands at 5.8% of GDP, which is lower than the budgeted 6.4%. This improvement is attributed to the higher revenue collection and potentially reflects the government's commitment to fiscal consolidation.

• The government commits to adhering to the path of fiscal consolidation with a projected fiscal deficit of 5.1% of GDP for 2024-25, slightly lower than the revised estimate of 5.8% for 2023-24.
• The popular scheme of providing a 50-year interest-free loan for capital expenditure to states continues, with a total outlay of ₹1.3 lakh crore in 2024-25. This aims to boost infrastructure development at the state level.
• The total expenditure is estimated to grow by 6.1% to ₹47.66 lakh crore compared to the revised estimate for 2023-24. This indicates increased government spending across various sectors. Total receipts excluding borrowings are also projected to rise by 11.5% to ₹30.80 lakh crore. This suggests optimism about revenue collection, potentially driven by economic growth or tax reforms.
• Tax receipts are estimated to reach ₹26.02 lakh crore, indicating continued focus on tax collection while potentially avoiding major changes in tax rates.

• Over the past decade, direct tax collections have witnessed an impressive threefold increase. Simultaneously, the number of return filers has surged to 2.4 times the previous figure, indicating a substantial expansion in the taxpayer base.
• The introduction of a new tax scheme has elevated the tax exemption threshold, eliminating tax liability for individuals with an income of up to Rs. 7 lakh. This significant increase from Rs. 2.2 lakh in the financial year 2013-14 aims to provide relief to a broader segment of taxpayers.
• The presumptive taxation threshold for retail businesses has been raised from Rs. 2 crores to Rs. 3 crores, offering a more favourable taxation framework. Additionally, the eligibility threshold for professionals under presumptive taxation has been increased from Rs. 50 lakh to Rs. 75 lakh.
• In a move to boost economic growth, the corporate tax rate has been reduced from 30 per cent to 22 per cent for existing domestic companies. Furthermore, certain new manufacturing companies now enjoy a reduced tax rate of 15 per cent.
• The age-old jurisdiction-based assessment system has undergone a transformative shift with the introduction of Faceless Assessment and Appeal. This modernized approach enhances efficiency, transparency, and accountability in the tax assessment process.
• Introducing updated income tax returns, a new Form 26AS, and prefilling of tax returns have streamlined the tax filing process, making it more accessible and user-friendly for taxpayers.
• The average processing time for returns has been substantially reduced from 93 days in the year 2013-14 to a mere ten days in the current year. This improvement ensures faster and more efficient processing of refunds, benefiting taxpayers.

The budget speech emphasized several positive developments in India's indirect tax system, particularly regarding the Goods and Services Tax (GST)

• The speech highlighted that GST has reduced the compliance burden on trade and industry. This suggests that businesses are finding it easier to comply with the new tax regime compared to the previous system.
• The tax base of GST has more than doubled since its implementation, indicating that more businesses are now registered under the system. This potentially leads to wider tax collection and increased revenue.
• The average monthly gross GST collection has almost doubled to Rs. 1.66 lakh crore. This significant increase in revenue suggests the effectiveness of the GST system in generating income for the government.
• States' SGST revenue, including compensation released to states, has achieved a buoyancy of 1.22 in the post-GST period. This indicates that states are receiving their share of GST revenue effectively and consistently, contributing to their financial stability.
• The speech also mentioned that steps were taken in Customs to facilitate international trade. This suggests efforts to streamline customs procedures and reduce trade barriers, potentially boosting India's international trade competitiveness.

• The budget maintains stability in tax rates, with no alterations in the existing tax structure for both direct and indirect taxes, including import duties. This approach aims to provide consistency and predictability to taxpayers and businesses.
• Resolution of Outstanding Direct Tax Demands:

1. A significant step towards easing the tax compliance landscape involves the withdrawal of outstanding direct tax demands. This pertains to petty, non-verified, non-reconciled, or disputed direct tax demands, some dating as far back as 1962.
2. Direct tax demands up to Rs. 25,000 for the period up to the financial year 2009-10 and up to Rs. 10,000 for financial years 2010-11 to 2014-15 will be withdrawn. This initiative aims to provide relief to taxpayers and streamline the resolution of long-standing tax issues.