The country was indeed looking keenly at the Union Finance Department for the budget of 2022. Not only was this budget crucial because the pandemic has almost disabled the economy but now there is a high time of a solid intervention from the Finance department. One of the many ways that the government could help out the mass population was through a strong pedestal; through the union budget. The budget of 2022 was a mixed basket with some policies that were extremely beneficial for the mass public and a great boost for the industries, while some of the policies were not satisfactory. Let us have a quick look at the Indian Fiscal Budget for the year 2022:
The budget was presented to the Indian Citizens on 1st February. The main target of this budget was stated as giving the much-needed boost to the infrastructure of the industries that will promote and target long-term sustainable development and growth of the Indian economy. While the income tax slabs were left unchanged, there were major policies to promote crypto proliferation in India. The introduction of a 30 % flat crypto tax rate was a major change of policies. Unlike the expectations that were apprehensive of an increase in the rate of standard deduction because of the ongoing pandemic-induced inflation, they were left the same.
India is fast progressing towards the 100th year of its Independence and the union ministry is keenly taking up multiple steps to make its journey worth memorable. The main goal of the Fiscal Budget of 2022, is to lay down a strategic plan for the betterment of India’s growth and development not only fiscal but across every parameter. The primary target under this flagship of Amrit Kal development, as outlined by the Union Finance Minister is to :
- Focus on the optimistic growth and development while taking up the inclusive welfare strategy across paradigms.
- To emphasize the greater use and development of technology-oriented development in India in a panoramic aspect.
- The budget also outlines a goal for sustainable energy development and combating various derogatory climate changes that are deeply affecting the Indian lives
- The Budget of 2022 laid down a milestone and paved a way for the fabrication of private and public funding projects. The amalgamation of public and private investments in various sectors and projects received prime focus in this year’s budget.
Some of the most important facets of the Union Budget that are aimed at Amrit Kaal attainment were:
- Inclusive development
- Highlighting PM Gatishakti
- Enhancing Investment Opportunities
- Taking various climate actions and a positive outlook towards green energy transitions
- Finance investments at various scales and multiple tiers
The financial assistance to Indian states from the union finance ministry was escalated from Rs.10,000 crore to Rs.15, 000 crores which is a great boost to the state economies. Moreover, Rs.1 lakh crore will be given as assistance to the states to catalyze greater investments. To bring about dynamicity in the state operations, 50-year interest-free loans provision will be enhanced. Along with these major steps, states will be allowed a massive fiscal deficit of close to 4% of their GDP, and even better than 0.5 % of this shall be integrated into the power sector.
To enhance the status of children’s education across the country and to bridge the unwanted gap that the pandemic had caused in the education sector for the past 2 years, the One Class-One TV channel program is launched which is under the flagship of the Prime Minister’s E-Vidya Yojna. Also, virtual labs and e-labs will be facilitated to promote the better learning of practical lessons. The integration of digital and virtual technical assistance in education is to be promoted throughout. The budget allocates funds for each of these programs along with allocating resources for the set up of digital universities and promoting personalization of education,
2 lakhs saksham (independent) anganwadis are to be set up so that women and children can receive the necessary nutrition and healthcare opportunities along with basic education at the grass-roots level. It is going to be a part of Mission Shakti and Mission Vatsalaya. The existing anganwadis are to be upgraded under the Saksham Anganwadi and Posham 2.0 scheme. This is to provide a better and integrated approach towards women and child care goal attainments.
The promotion of solar energy shall be facilitated by the additional investment of 19,500 crore INR towards the development of efficient solar modules. This is an important approach towards the 280 GW mission whose deadline is 2030. Also, the biomass pellets in thermal power plants have been escalated to 5-7%. Various projects shall be found that will help set up four pilot programs for the conversion of coal into other chemical formats. The government is trying to promote agroforestry by giving incentives to local farmers and farmers of the scheduled castes and scheduled tribes to take up agroforestry as a profession. Stubble burning in agricultural fields is being strictly forbidden.
To aim higher in the technical dimensions, the government is going to allocate huge funding towards sunrise opportunities. Emphasis is going to be given towards the Research & Development :
- Artificial Intelligence
- Geospatial System
- Green Energy Technology
- Mobility Systems
- Space Economy
Undoubtedly the Union Budget paid enormous heed to the lifeline of financial operation in Inia and that is none other than the banking system. Just like various other projects, the government has taken up an integration approach for the banking sector as well. The existing 1.5 lakh post offices are all to be included in the pipeline of the core banking system in India. Also, 75 Digital Banking Units are to be set up primarily in 75 districts across the country to help bring effective digitization and technological advancement in the banking sector.
This has literally been the buzzing sensation of this year’s Union budget. Almost everybody is scrutinizing this faucet of the union budget. For developing countries like India where digitization has not been panoramic, it is indeed a great step on the part of the Union government to prioritize and give a push to the Crypto domain. Through the Budget of 2022, the Union Ministry has set clear goals and purposes and demarcated the various areas of taxation related to cryptocurrency.
Virtual assets and cryptocurrencies will be taxed at a flat rate of 30%. Also, another very important feature is the TDS deduction rate on virtual assets. It has been kept at only 1% for transactions above the threshold value. Not only business transactions but the gifts that are sent and received across the crypto platform will also be taxed likewise.
The finance budget also carved out the initiative for robust healthcare system management. The healthcare system in India is better than most other developing countries. However, one faucet that it lacks is the proper management and s standard database that will have an accurate record of the system. The Finance budget of 2022 proposed for the creation of an open platform that will promote and roll out the National Digital Health Ecosystem. This standard and mammoth database system will have accurate records and entries of all the healthcare workers, beneficiaries, and healthcare facilities.
This giant database will tag every beneficiary and worker with unique healthcare codes that will help the system much more organized and easier for the Union Health Ministry to have exact figures and accurate track records of the entire healthcare system. The creation of such an integrated healthcare system management database is definitely going to be a unique step towards the consolidation of India’s healthcare management system.
Apart from the Healthcare system, the Union Budget of 2022, also focuses on another welfare objective and it is none other than Highway Expansion. The government has planned out a 25000 km national highway expansion by the year 2023. The logistics for the projects are planned out to be multimodal and in a PP mode. Well, PPP mode refers to Public-Private partnerships. That means these projects will be a government and private sector collaboration. That shall hopefully enhance the effectiveness and work capacity of the entire integrated healthcare system of India.
The higher pegging of fiscal deficits has been one of the major lookouts of the Budget of 2022. The fiscal deficit of India is almost rising to the level of 6.9 percent of the total GDP. There is a huge gap between the expected expenditure and the resource mobilization. The expenditure is expected to be close to around 39.45 lacks vehicle the resource mobilization is expected to be somewhere close to 22. 84 lacs INR. The gap is huge and the union plans to bridge the gap by cutting down the fiscal deficit to 6.4 percent.
The Union Budget 2022 received a heterogeneous reaction. This is precise because a pandemic hit the economy at its lowest development phase was expecting more immediate reliefs and packages to help rescue the people rather than such long-term plans.