Presenting the interim budget for 2024-25, she said the government is working with an approach to ensure development that is all-round, all-pervasive and all-inclusive.
"It covers all castes and people at all levels. We are working to make India 'Viksit Bharat' by 2047. For achieving this goal, we need to improve people's capability and empower them," she said.
There is a need to focus on "four major castes" that are "garib" (the poor), "mahilayen" (women), "yuva" (the youth) and "annadata" (the farmer), Sitharaman said and asserted that their needs, aspirations and welfare are "our highest priority".
"The country progresses, when they progress. All four require and receive the government's support in their quest for better their lives. Their empowerment and wellbeing will drive the country forward," the finance minister said in her pre-election budget.
She said that earlier, social justice was mostly a "political slogan". For this government, social justice is an effective and necessary governance model, Sitharaman said.
"The saturation approach of covering all eligible people is the true and comprehensive achievement of social justice. This is secularism in action, reduces corruption and prevents nepotism. There is transparency and assurance that benefits are delivered to all eligible people," she said.
Sitharaman said that now resources are distributed fairly.
"All, regardless of their social standing, get access to opportunities. We are addressing systemic inequalities that had plagued our society. We focus on outcomes and not on outlays so that the socio-economic transformation is achieved," she said.
According to Sitharaman, the next five years will be years of unprecedented development, and golden moments to realise the dream of developed India @ 2047.
“The trinity of demography, democracy and diversity backed by ‘Sabka Prayas’ has the potential to fulfill aspirations of every Indian,” said Sitharaman.
Strategy for ‘Amrit Kaal’
Finance Minister Nirmala Sitharaman said that the government will adopt economic policies that foster and sustain growth, facilitate inclusive and sustainable development, improve productivity, create opportunities for all, help them enhance their capabilities, and contribute to generation of resources to power investments and fulfil aspirations.
Guided by the principle ‘Reform, Perform, and Transform’, the government will take up next generation reforms, and build consensus with the states and stakeholders for effective implementation, she said.
“Aligning with the ‘Panchamrit’ goals, our government will facilitate sustaining high and more resource-efficient economic growth. This will work towards energy security in terms of availability, accessibility and affordability,” said Sitharaman.
Peppered with political innuendos, her sixth straight Budget may present a political document with a snapshot of the Modi government's triumphs over the last 10 years and pointers to how it wants to take the country forward.
With pressure for populist measures off after recent emphatic wins in three states, she is expected to stick to being fiscally prudent while sprinkling sops on sectors like agriculture and engines of the economy that would create jobs and boost consumption.
The Budget she will present is technically a vote on account and popularly termed an interim Budget as it seeks Parliament's nod for a grant in advance to meet the central government's essential expenditure for the first four months of the new fiscal year that starts in April. A new government elected after the April/May general elections will present the full Budget, likely in July.
The interim Budget, however, presents an occasion for spectacle just weeks ahead of the Model Code of Conduct coming into force.
While the precedence dictates that no major policy announcements are made in a vote on accounts, going by past conventions hasn't stopped governments from making big announcements like the cash dole for farmers announced in the 2019 interim Budget.
The Budget is expected to focus on infrastructure and buck a trend of spending big on new vote-garnering measures.
The Budget would, however, provide an occasion to assess the fiscal health of the economy against the backdrop of robust economic growth. It would provide an occasion for the government to give a clear roadmap for achieving the Fiscal Responsibility and Budget Management Act (FRBMA) targets.
The budgeted fiscal deficit of 5.9 per cent of the gross domestic product (GDP) for the current fiscal is likely to be achieved, but it is nearly twice the FRBM fiscal deficit to the GDP target of 3 per cent for the central government. Correspondingly, the debt-GDP ratio at 54 per cent is also well above the target of 40 per cent.
EY, in a note, said the possibility of sustaining nominal GDP growth at 10.5 per cent, it may take up to 13 years to reach a debt-GDP level of 40 per cent. This is based on successfully reducing the fiscal deficit to GDP ratio to 3 per cent by FY29.
Suman Chowdhury, chief economist and head - Research, Acuite Ratings & Research, said, "Given the priority that is likely to be given for fiscal consolidation in the upcoming Budget, we don't expect any significant fiscal stimulus in it. However, the government may continue to earmark a significant quantum for capital expenditure with a growth of 15 per cent in its budgetary allocation; the latter will continue to be a primary driver of the domestic economy over the medium term".
The government may also enhance the subsidy allocation for some segments like farmers, women, informal sector workers and unemployed youth to strengthen domestic private consumption, which is estimated to show a weak growth of 4.4 per cent in FY24, he said.
"Given the need to sustain the public investments and also support certain social segments through subsidies or budgetary relief, the targeted reduction of fiscal deficit from 5.9 per cent to 5.3 per cent will pose a material challenge for the finance ministry, necessitating significant step-up in non-tax revenues like PSU disinvestments."
A research note from the Bank of Baroda said that with the 2024-25 Budget being an interim one, the government will focus on maintaining continuity of policies while committing itself to the path of fiscal consolidation.
"In the wake of weak monsoon, and subdued Rabi sowing, the Budget will focus on steering rural growth. For this, enhanced spending on MGNREGA, PM KISAN, and PMAY can be expected. Driving investment growth will be another focus area for the government. We thus expect Rs 1.5-2 lakh crore incremental increase in capex for the next year."
Radhika Rao, Senior Economist, DBS Group Research, said the Budget will emphasise an "inclusive and prosperous" policy push in the context of incremental progressive steps in the roadmap over the next 20-plus years toward India@100 (a century since independence).
"In an election year, the government usually tables the vote-on-account or the Interim Budget. A vote-on-account seeks approvals for essential expenditure outlays until the polls, while the interim Budget broadly includes an assessment of the current state of the economy, current/capex expenditures, and receipts, as well as revised estimates of the current financial year and estimates for the year ahead."
Taking a leaf off the pre-election 2019 Budget, "we expect this interim edition to propose modest pro-demand steps to address near-term risks", she said.
In February 2019, the incumbent administration announced fiscal concessions and benefits to the farm sector and other deserving parts of the society. This time, the BJP dominated the recently held state elections, lowering the likelihood of aggressive competitive populism.
Delivering the inaugural address at Kautilya Economic Conclave 2023, the minister said benefits under more than 50 government schemes are being directly transferred into the beneficiaries' bank accounts, and PMJDY has played an important role.
She also said when the scheme was launched, a certain section of people had made "snide" remarks saying public sector banks would be under pressure as these are zero balance accounts.
However, these accounts have a balance of more than Rs 2 lakh crore, Sitharaman said.
In her address she also spoke elaborately on climate financing and challenges associated with it.
The minister also said that multilateral institutions including Multilateral Development Banks (MDBs) have become less effective in the current global situation.
Sitharaman also highlighted the challenges posed by global terror and stressed that investors and businesses will have to take into account such factors while making investment decisions.
She further said the Prime Minister Narendra Modi-led government is conscious of the debt situation and has undertaken fiscal management to ensure that the coming generation is not burdened.
She said this ‘Nari Shakti Vandan Adhiniyam’ has actually been very thoughtfully crafted considering that we are at a very critical stage of our development process.
She said that it is important we build consensus and prepare for economic and social empowerment of women
Speaking in Rajya Sabha over the Bill, Sitharaman said: "I want to credit former PM P.V Narasimha Rao's government for bringing 33 percent reservation at the panchayat level. As a result, we have seen a groundswell at the panchayat level where reservation has been increased to 50 percent at several panchayats showing the contribution of women."
She said that "there is no bill waiting."
She said the bill that was passed in Rajya Sabha in 2010, also later lapsed. "There is no bill waiting. With a dissolution of the Lok Sabha, that bill that was passed in Rajya Sabha and was naturally transmitted to Lok Sabha in 2010, also lapsed," Sitharaman said.
She also said that the proposal for the women's quota bill is not being made for the first time.
"Four such genuinely serious attempts have been made in past to get this bill through," she said.
She said that first attempt was made in 1996, then in 1998, then in 1999 and most recently in 2008 to pass this bill.
She further said that exercise of delimitation will be done to identify the number of seats to be reserved for women in Lok Sabha and legislative assemblies.
"The reservation will cease after 15 years of being implemented," Sitharaman in said.
"As far as the implementation of the proposed reservation for women...After the Bill is enacted and after the bill comes into operation...Whenever the first census takes place and the relevant figures for that census are published, a fresh delimitation exercise shall be undertaken...," the Finance Minister said.
She also said that the bill was long overdue.
Defending the government, why it took nine and half years, she said: "People are questioning why it took nine years to bring this bill. We wanted to make sure that we were committed for holistic development of women. There have been several events to provide dignity, houses, and toilets to women. This reservation will provide reservation for women in Lok Sabha and state assemblies."
"In women-related matters, we (BJP) do not play any politics. It is an article of faith for the PM and therefore we do everything that we have done whether it is Article 370, triple talaq, or women's reservation bill," she said.
She further said that BJP has been consistently supportive of women reservation.
Inaugurating the three-day Global Fintech Fest (GFF 2023) here, the FM said that today fintech is a robust and dynamic financial inclusion tool, and in lending they hold a 36 percent share of new-to-credit customers versus 22 percent share of the brick-and-mortar banks for which it’s one of the core businesses.
However, she said that in the modern world, the fintech ecosystem is open to various threats and challenges including physical border threats by conventional warfare, cyber threats, crypto threats, drugs and drug mafias, tax haven and tax evasions.
Addressing these threats which are before us and active are key to building a responsible, inclusive and resilient and sustainable financial ecosystem for which Sitharaman appealed to fintechs to invest heavily to protect themselves from such threats.
Later, a glittering awards night was held in which prominent fintech players from India and abroad were honoured in different categories.
The coveted Global Award for ‘Leading Fintech Personality of the Year’ for the Gulf Cooperation Countries went to Adeeb Ahamed, Managing Director, Lulu Financial Holdings, Abu Dhabi, for revolutionising cross-border payments between the GCC and India.
The President & COO of One97 Communications Ltd Bhavesh Gupta bagged the ‘Fintech Leader of the Year’, Volt Founder-CEO Tom Greenwood conferred the ‘Leading Fintech Personality of the Year-Europe’, Zerodha CTO Kailash Nadh won the ‘Fintech CTO of the Year’ awards, and Open Network for Digital Commerce given the ‘Fintech Company of the Year’ award.
Sitharaman also unveiled a through leadership report, “The Second Wave – Resilient, Inclusive, Exponential Fintech” in the presence of top honchos like Yash Erande, Saurabh Tripathi, Vishwas Patel, Naveen Surya, Kris Gopalakrishnan, G. Padmanabhan, Praveena Rai, Dilip Asbe, Srinivas Jain and others.
States can adopt the policy according to their requirements, she said at the launch event for Desia' and Kuwi' (tribal languages) primer books in Bhubaneswar, along with Union Education Minister Dharmendra Pradhan.
"NEP is a flexible policy. It is not something that the Centre decides and imposes on all the states. It is a broad framework and the states can adopt it according to their requirements," Sitharaman said.
She said the NEP is a result of different people putting their minds together after extensive consultation.
Sitharaman also said that "when one learns, speaks and thinks in one's mother tongue, there's clarity of thought. That is why learning in the mother tongue is important. The central government is making all-out efforts for the education of tribal children".
Speaking on the occasion, Pradhan said there are over 62 tribes covering 23 per cent of Odisha's population, and it becomes necessary to teach the students with the help of pictures, stories and songs based on their local nature and culture to improve their cognitive development.
At another event in the state capital, Sitharaman called upon the chartered accountants' fraternity to make itself familiar with new technologies and global developments like carbon accounting and environment, social and governance (ESG) norms.
Noting that India's economy is driven by start-ups, new-age industries, and those transitioning from traditional methods to modern approaches, she said such activities require the support of CAs.
Earlier in the day, the two Union ministers attended a series of events under the nationwide Meri Maati Mera Desh' campaign.
The finance minister also collected maati' (soil) in the Amrit Kalash' (sacred pot) at Biraharekrushnapur, the birthplace of renowned freedom fighter Jayee Rajguru in Puri district.
Sitharaman honoured the family members of martyrs and freedom fighters in Puri.
She also administered the Panch Pran' pledge to a gathering during a programme at the Central Sanskrit University, and said every Indian should be free from the slavery mindset instilled by the British.
"Prime Minister Narendra Modi has emphasised the need to eliminate any trace of colonial mindset," she said.
The finance minister arrived in Bhubaneswar on a two-day visit to Odisha on Wednesday evening.
Sitharaman was accompanied by Union Education Minister Dharmendra Pradhan and BJP national spokesperson Sambit Patra, MLAs Jayanta Sarangi and Lalitendu Bidyadhar Mohapatra during her visit to the shrine.
The Union Minister is scheduled to take part in a sand art session on ‘Meri Maati Mera Desh' by sand artist Sudarshan Pattnaik.
She will also participate in a plantation drive at Puri and visit the birthplace of noted freedom fighter Saheed Jayee Rajguru.
After returning to Bhubaneswar, Sitharaman and Pradhan will join a book launch.
Later, the Finance Minister will attend the inauguration of the 20th National CA Conference in the state capital.
Notably, the Finance Minister arrived in Bhubaneswar on a two-day visit to Odisha on Wednesday night.
Sitharaman, who was accompanied by Union Education Minister Dharmendra Pradhan, went to the BJP state headquarters from the airport to join a memorial meeting in honour of former party leader and the first Mayor of Cuttack, Nibedita Pradhan.
Nibedita Pradhan passed away on August 10.
The Union Ministers also paid tribute to former prime minister Atal Bihari Vajpayee on his death anniversary.
As many as 55,000 one-time cases were opened following a Supreme Court order, she said.
In her address at the 164th Income Tax Day event, the Finance Minister said that tax rates have not gone up over the years, yet revenue has been constantly rising over the past three-four years.
"We are talking about widening the tax base via awareness and nudging. The Income Tax Department is working towards a taxpayer-friendly regime.
“If income tax revenues are increasing it is not because of the hike in rates but due to efficiency, plugging of leakages and formalisation of the economy,” she said.
Central Board of Direct Taxes (CBDT) Chairman Nitin Gupta said that more than four crore income tax returns (ITRs) have been filed so far for 2022-23, and more than half of them have been processed leading to issuance of 80 lakh refunds.
Seven per cent of the assessees who filed income tax returns this year are "new taxpayers", he said, adding that the number of new taxpayers is expected to increase by July 31.
He, however, added that the "shortage of manpower (in the department) at every level was impeding our efforts to give even better results" and urged the Finance Minister for a "quick approval" of the department's cadre restructuring proposal.
Revenue Secretary Sanjay Malhotra, who was also present on the occasion, said: “Record 72 lakh income tax returns were received in one day… Average processing of returns has been reduced to 16 days. We need to focus more on further automation of taxpayers' services."
"Hearty congratulations Ajay Banga on being selected as the President of @WorldBank. I am confident that you'll bring your wide experience in the corporate world for meeting the goals of the bank," she said in a tweet.
Banga, who was selected as the new World Bank president on Wednesday, had most recently served as vice chairman at General Atlantic.
In a statement, the World Bank said that its "board looks forward to working with Banga on the World Bank Group Evolution process, as discussed at the April 2023 Spring Meetings, and on all the World Bank Group's ambitions and efforts aimed at tackling the toughest development challenges facing developing countries".
The president of the World Bank Group is also the Chair of the Board of the Executive Directors of the International Bank for Reconstruction and Development (IBRD).
The president is also the ex-officio chair of the Board of Directors of the International Development Association (IDA), International Finance Corporation (IFC), the Multilateral Investment Guarantee Agency (MIGA), and of the Administrative Council of the International Centre for Settlement of Investment Disputes (ICSID).
The trouble the 70-year-old had to endure for allowance is heart-wrenching. She has neither strength to walk properly, nor the energy to speak in an audible voice.
Finance Minister Nirmala Sitharaman on Friday expressed concern over the incident and wanted the State Bank of India (SBI) and the Department of Financial Services to take cognisance and act humanely.
She further questioned if there was no bank Mitra to help the elderly woman.
“Can see the manager of the @TheOfficialSBI responding but yet wish @DFS_India and @TheOfficialSBI take cognisance of this and act humanely. Are they no bank Mitra?,” FM Nirmala Sitharaman wrote.
Replying to the Finance Minister, the SBI authorities wrote, “Madam, we are equally pained to see the video. Smt Surya Harijan in the video used to withdraw her old age pension from the CSP point situated in her village every month. Due to her old age, her fingerprints were not matching at the CSP Point.”
“She visited our Jharigaon branch with her relative. Our Branch Manager immediately paid the amount by manually debiting her account. Our Branch Manager has also communicated that her pension will be delivered to her doorstep from next month.”
The SBI also promised to handover a wheelchair to Surya Harijan.
In an interaction with Adam Posen of the Peterson Institute of International Economics in Washington DC, during her ongoing tour of the US, the finance minister gave Pakistan's example, saying that it was created as an Islamic country which had promised to treat minorities equally, however there the minorities and even several Muslim sects, which don't agree with the majority community, have been "decimated and diminished in numbers".
"In sharp contrast, minorities in India have only grown in numbers since 1947 and have been doing their businesses comfortably...They have been getting scholarships. India has the second largest Muslim population in the world. The answer also lies in the fact that investors have been coming to India. I will say that please come and see for yourself the reality, rather than listening to those who haven't even seen what is happening on the ground," she said during the interaction, which focussed on "resilience of the Indian economy amid tightening of Indian conditions".
She was responding to a question by Posen on violence against Muslims in India as reported by Western media and also opposition MPs losing their status (referring to Rahul Gandhi's disqualification from Parliament).
Meanwhile on the Indian economy's resilience, the finance minister said that "it is due to the enterprising nature of Indians. Despite suffering and loss of lives, we took up Covid-19 as a challenge and helped each other. The government extended support to people through targeted approach and undertook humanitarian steps."
Speaking on supply chain disruptions, the finance minister said, "Given the shocks witnessed due to supply chain disruptions, MNCs have become prudent and are diversifying. India is poised for a more important role in the global value chains. India is attractive because of its skilled youth and large domestic market."
Highlighting India's future goals, Sitharaman said, "Today, we are reaching saturation in providing basic facilities to citizens such as houses, electricity, transport, etc., and are empowering them. Emphasis is there on financial inclusion so that all have bank accounts and benefits reach them directly. Going forward, we are focusing on skilling and digitisation so that there's greater ease of living, transparency and formalisation of the economy."
On emerging markets and G20, she noted that India is carrying forward agendas of earlier G20 Presidencies, bringing issues on table that India considers important and also making way for the future G20 Presidencies to build upon the legacy of India's G20 Presidency.
"Emerging Markets have G20 Presidencies for three consecutive terms from Indonesia in 2022, India in 2023 and Brazil next year. This will bring views of the Emerging Markets to the front and also the voice of the Global South on to the G20 table," Sitharaman added.AA
She further said that the World Bank and International Monetary Fund (IMF) are also holding a roundtable on Global Sovereign Debt.
"Initial discussions happened at the first G20 FMCBG in Bengaluru. India's G20 presidency will create discussion and sharing of information on this issue and it will be taken forward positively," the finance minister added.
On the World Trade Organisation (WTO), Sitharaman added that it should be more open about issues.
"WTO has to be progressive and fair to all members. It has to give voice to all and not just hear but also heed. There's a continuation of a moratorium since 1998 on electronic transmissions despite evolution to the digital age. Shouldn't there be a change in WTO policy in terms of a moratorium? We don't have to reverse the benefits of globalisation but make it more transparent," she emphasised.
"I would like the WTO to be a lot more progressive, a lot more listening to all countries, to be fair to all members," Sitharaman said during a fire-side chat at the Peterson Institute for International Economics, a top American think-tank in Washington.
"I, fortunately, unfortunately spent some time with the WTO in my capacity as a commerce minister of India between 2014 and 2017. It has to give more space to hear voices of countries which have something different to say and not just hear, but also somewhat heed because today's message for the WTO should be to have greater openness," Sitharaman asserted.
"In fact, I'm not quoting, in the context of WTO, but it might be useful to recall the words of US Commerce Secretary (sic), Katherine Tai. She had recently spoken and I was very, very impressed, if I can use that word, about what exactly is the traditional trading approach. What exactly is liberalizing the market? What would it actually mean in terms of tariff reduction?" she said.
"It is true now, countries do look at it. It is a time when countries are looking at what extent to which you would want to have market liberalization. It has had cost repercussions for the US economy, and that's exactly what the US Secretary Commerce has said. And if that's something which the United States Commerce Secretary feels, I felt the same in 2014 and 2015. Probably my articulation was never getting a space in global media. But many of the global south countries do have the same feeling," she said.
"What exactly is this? How far is liberalization? To what extent tariff reduction? We in India for all the less developed countries, the global South, if you would ask them would have a similar opinion as the US Commerce Secretary. But in India, we've already extended to all the least developed countries, quota-free, tariff-free trading policy," she said.
"So any country, let's say from Africa or anywhere else, the Pacific Islands or countries which are aspirational, low income countries can export to India without any of these restrictions. So, where it is possible, we are opening up, but at the same time, we need to look at how India's become remanufactured almost because if you go through the MFN route, you end up opening up for the efficient ones in the market, and that may not be your country. Manufacturing abilities of communities have all gone for a toss, not just in India, but I suppose in many countries as well," she said.
The finance minister wonders how a country gets its manufacturing back if it only have to constantly liberate its market. "Discussion worthy points."
"India's attempt to talk to the WTO, talk in WTO have all faced with just no moment. The other classic example, which is in the minds of many of the emerging market countries is the electronics transmission related wall. Isn't that since 1998, all of us are sitting and watching that you can't do anything on the customs route for so much that is happening in the electronics business. It's hitting the kind countries very differently," she said.
"Since 1998, there has never been a need for reviewing it. All that I'm asking is that. And why wouldn't every ministerial conference, which happens, ever, ever, ever take up this for discussion. It doesn't take. The moratorium continues. So, it shouldn't be difficult for you to appreciate. So when countries will have to speak at the WTO, it has to be on very many issues on which decision has not happened for over decades," Sitharaman said.
Bejon Kumar Mishra, Managing Trustee, Consumer Online Foundation said in the letter to Sitharaman that as per its official website, Rario refers to itself as the world's first and largest licensed digital cricket collectible platform, dedicated to bringing the fans closer to the sport like never before. In reality, Rario is an NFT and Cryptocurrency platform, a fact which is not obvious to a visitor to their website.
Rario refers to itself as a company engaged in the buying and selling of Digital Player Cards. Indian cricket fans form the majority of its consumers. By its own admission in a press release dated March 20, "Rario has sold over 1.3 million player cards to cricket fans", which is a phenomenal number in such a short span of time. Rario counts cricket legend Sachin Tendulkar as its strategic investor.
Rario's Parent Company Digital Collectibles Pte. Ltd. is based out of Singapore whose Indian wholly owned subsidiary, Rario Digital Private Limited is located in New Delhi. This is an interesting arrangement for the entities to circumvent the Indian laws to park monies overseas.
"Our initial study has revealed that Rario violated the applicable taxation provisions of virtual digital assets and crypto currency in India. It is observed that in all transactions in Rario the consumers are misled in a deceptive manner by adopting unethical marketing practices, which are not only deemed as unfair trade practices but also violating the rights of the consumer," Mishra said.
Mishra said Rario's current KYC processes tantamount to violation of anti-money laundering (AML) laws of our country. As per the Finance Ministry recent notification, entities dealing in virtual digital assets (VDAs) will now be considered 'reporting entity' under the Prevention of Money Laundering Act (PMLA) and need to maintain KYC details or records of documents evidencing the identity of its clients and beneficial owners as well as account files and business correspondence relating to its clients.
Rario is facilitating International transactions under the Liberalised Remittance Scheme (LRS) of the Foreign Exchange Management Act (FEMA) 1999, without any limits on the transactions. This is a concern under FEMA Regulations with money going outside India without using authorised routes like LRS, which lays down the guidelines for outward remittance from India.
Rario is also using celebrities like prominent cricketers Sachin Tendulkar, Smriti Mandhana, Cheteswar Pujara and others to mislead and lure millions of innocent and vulnerable cricket fans to buy and sell player-cards on its platform in an unethical and illegal manner, Mishra said.
Sitharaman once and for all cleared all doubts and apprehensions about Odisha's Special Category Status demand. Addressing a press conference in Bhubaneswar, she said, “The Finance Commission has clearly said that no special category status will be given to any State. Telangana was an exception. It was awarded the special category status during the Andhra Pradesh bifurcation.”
On allegations of Centre reducing MGNREGS funds to Odisha in the budget, Sitharaman said, “The fund allocation for MGNREGS has not gone down. We keep increasing the allocation as and when the demand increases because the scheme itself is a demand-driven scheme. If you will review the previous 7-8 budgets, every time the initial allocation of the MGNREGS is revised later in the year with an increase in demand.”
“It is one thing to allocate money in the budget and another thing to monitor the ground situation and revise the budget as per the demand. And the most important thing is to implement the scheme on the ground and ensure that the money is actually spent,” she said.
On bringing petrol and diesel prices under the ambit of GST, Sitharaman said, “The GST council will have to take a call on this. Petrol and diesel have already been brought under the GST. Only the rates have not been determined. As soon as the GST rates are finalised by the GST council which has finance ministers of all the states, we will put it on the GST list.”
Sitharaman also highlighted that the States are being provided interest-free loans for 50 years by the Centre. This year’s budget has put emphasis on scheduled castes and tribes. They will get benefits from the Awas Yojana and Har Ghar Nal scheme, she said.
(Reported By Kapilendra Pradhan, OTV)
Replying to the discussion on Union Budget in the Lok Sabha, the Finance Minister said that fertiliser subsidy has been hiked by one-and-a-half times, adding that during the Congress-led UPA regime, only a handful of states took ration under National Food Security Act (NFSA), while Prime Minister Narendra Modi has provided free ration to the entire nation's poor during the Covid-19 pandemic.
Responding to opposition's allegations that food subsidy has been cut, Sitharaman said that it has been almost doubled to Rs 1.97 lakh crore.
"There's no reduction in food subsidy," she said.
"The cost of PM Gareeb Kalyan Yojana and public distribution system is being fully borne by the Centre," she added.
Rebutting the opposition's charge that no allocation has been made for the PM-KISAN scheme, the Finance Minister said that every eligible beneficiary of PM-KISAN will continue to get the benefit with the scheme providing them Rs 6,000 per year.
Sitharaman also said that the economy is in a sustained path, and India is still the fastest growing major economy in the world and will continue to be so in the years to come.
Defending the new tax regime, she said that by offering a rebate on annual income of up to Rs 7 lakh under it, the scheme will leave higher disposable income in the hands of people.
Sitharaman added that the Union Budget "astutely balances the requirement of development imperatives within the limits of fiscal prudence".
She also spoke about the employment opportunities offered by the government, saying that around 10 lakh jobs are being offered, with the interest of states being of paramount importance.
The agriculture credit target for the 2023-24 fiscal has been increased to Rs 20 lakh crore, she added.
The minister described the Budget for 2023-24 as a balanced one, with increased capital expenditure and ensured fiscal prudence.
Her entire 90-minute reply was peppered with sarcasm, cryptic one-liners and strong rebuttals.
Responding to opposition's charge of lack of allocation to welfare schemes like MGNREGA, minority affairs and cut in food subsidy in the Budget, Sitharaman took pot shot at Congress' leader in the House, Adhir Ranjan Chowdhury, and Assam MP Gaurav Gogoi.
"You should not be political about the poor when your own house is made of glass," she said.
Sitharaman also took jibes at Gogoi, saying that he was getting excited every time.
She was all charged up when the issue of reduced allocation for minority welfare was raised by Adhir Chowdhury.
Citing incidents of violence against minorities in Assam during Indira Gandhi's tenure as Prime Minister and the anti-Sikh riots of 1984, Sitharaman said did the Congress think of hiking their allocation when such incidents happened.
She accused the Congress of playing the minority appeasement card for vote-bank politics.
"We don't indulge in 'chacha-bhatija' culture, we give benefits to all irrespective of religion. This is Modi's government. We believe in 'Sabka Saath, Sabka Vikas, Sabka Vishwas and Sabka Prayas," Sitharaman said while taking a jibe at the Congress.
Finance Minister Nirmala Sitharaman in her Union Budget 2023-24 speech said that the subsidies on EV batteries will be extended for one more year, hence making EVs cheaper in the country.
In May 2021, the government unveiled the Production-Linked Incentive (PLI) scheme for manufacturing batteries.
To be eligible for the Rs 26,058 crore incentives under the PLI scheme for the EV industry, an automaker must have a global revenue of at least Rs 10,000 crore and have a minimum investment of Rs 3,000 crore in fixed assets.
The EV industry and battery players hailed the government's move.
"The proposed Customs duty exemptions on the import of capital goods and machinery required for the manufacturing of lithium-ion batteries bring in a new lease of life for all battery manufacturers," said Pankaj Sharma, Co-Founder and Director, Log9 Materials.
The move would help accelerate the country's production capacity and also gives the much-needed momentum to the country's vision to become self-sufficient in its EV needs, he added.
Nirmal K. Minda, Chairman and Managing Director, Uno Minda Ltd, said that the announcement of Rs 35,000 crore fund to support green projects will give a massive boost towards India's net-zero goals.
"We look forward to understanding the FM's proposal to reduce the basic Customs duty on some goods from 21 per cent to 13 per cent, including lithium and ion cell batteries used in EVs," he said.
As the electric vehicle (EV) adoption grows in India, the electric two-wheeler sales volume in the country is likely to reach 22 million by 2030.
According to the latest report by Redseer Strategy Consultants, the electric two-wheeler market is expected to be over 80 per cent of the overall two-wheeler market by 2030.
Kalyan C. Korimerla, MD and Co-Promoter, Etrio Automobiles, said that the pro-EV budget focuses on much-needed initiatives such as Customs duty reduction from 21 per cent to 13 per cent on lithium cells and an extension of the subsidies on EV batteries for one more year.
"These are welcome initiatives as these will help boost the demand. The policy on the replacement of old polluting vehicles should accelerate the transition towards electric vehicles which is in line with the budget's aim to spur eco-conscious lifestyles," said Korimerla.
She will lay the document in the Lok Sabha after the conclusion of President Droupadi Murmu's address to both Houses of Parliament.
Tuesday is the first day of the Budget session of Parliament.
Apart from this, a copy of the President's address will also be laid in the Lok Sabha.
Obituary references will be made for sitting and former members of the Lok Sabha, who passed away during the intervening period between Winter and Budget sessions.
Obituary references will be made for sitting Congress MP from Jalandhar Santokh Singh Chaudhary, who passed away earlier this month.
Apart from him, obituary references will also be made for seven-time former MP Sharad Yadav, veteran Telugu actor and former MP Satyanarayan Kaikala and Basavanagoud Kolur.
So, here meet the most powerful, self-made women of India.
Nirmala Sitharaman: The finance minister of India, was included in Forbes' annual list of the 100 Most Powerful Women in the World, retaining her position for the fourth time. She occupied the 36th spot. Also, she ranked 37 in 2021, 41 in 2020, and 34 in 2019.
Roshni Nadar Malhotra: The youthful chairwoman of HCL Tech, was ranked number 53 on the 2022 list. She was twice added to Forbes' list of the most powerful women in the world. She manages all of the business's strategic choices. Her father, Shiv Nadar, founded the company in 1976.
Madhabi Puri Buch: The chairwoman of the Securities and Exchange Board of India (SEBI), was ranked number 54 on the list.
Soma Mondal: The women from Odisha, the first female chairwoman of the Steel Authority of India, was listed at position 67. Under her direction, SAIL expanded to unprecedented heights, and its profit increased several times over.
Kiran Mazumdar Shaw: The Biocon Executive Chairperson, showed up at number 77. In 1978, one of the wealthiest self-made women in India launched the country's largest listed bio-pharmaceutical company.
Falguni Nayar: The CEO of Nykaa, was positioned at 89. The 59-year-old former investment banker launched Nykaa, a beauty company, in 2012; it went public in 2021.
The minister would hold virtual meetings on November 21 in three groups with industry chambers, infrastructure sector and environment experts seeking suggestions for the 2023-24 Budget making from stakeholders.
On November 22, Sitharaman would meet agriculture and agro processing industry, representatives from financial sector and capital markets.
She will also be meeting the representatives of services sector and trade bodies, besides experts from social sector, including health, education, water and sanitation, on November 24.
The pre-budget meetings with the trade union representatives and economists are scheduled for November 28.
The participants will give suggestions on the 2023-24 Budget which will be presented in Parliament by the Finance Minister on February 1.
Sources said climate change would be one of the priority areas in 2023-24 Budget making as India has pledged to become net zero emitter of carbon by 2070.
The budget for the next year will have to address critical issues of high inflation, boosting demand, job creation and putting the economy on a sustained 8 per cent-plus growth path.
It will be the fifth budget of the Modi 2.0 government and Sitharaman, and the last full budget before the general elections slated in April-May 2024.
"The story (of India's 5G) is yet to reach the public," Sitharaman said in her interaction with students at the Johns Hopkins School of Advanced International Studies (SAIS).
"The 5G that we've launched in our country is completely standalone," she said in response to a question.
"There could be some parts coming from, say, countries like (South) Korea, but (not) coming from somebody else. So complete indigenous technology that we can now provide 5G (to any country) who wants it," she said.
"So, our 5G is not imported from somewhere else. It's our own product," Sitharaman said.
The 5G services were recently launched by Prime Minister Narendra Modi in select Indian cities and are likely to cover the entire nation by 2024, she said.
"On 5G, I think, we can be immensely proud of India's achievements," Sitharaman said.
Job creation and equitable distribution of wealth remain the other focus areas, she said at India Ideas Summit here.
"Some of course are red-lettered (priorities), some may not be. Red-lettered ones would of course be jobs, equitable wealth distribution and making sure India is moving on the path of growth.
"In that sense inflation is not red-lettered. I hope it doesn't surprise many of you. We have shown that in the past couple of months that we were able to bring it to a manageable level," she said at the event.
According to official data, retail inflation softened to 6.71 per cent in July due to moderation in food prices but remained above the Reserve Bank's comfort level of 6 per cent for the seventh consecutive month.
The Consumer Price Index (CPI) based retail inflation was at 7.01 per cent in June and 5.59 per cent in July 2021. It was above 7 per cent from April to June this fiscal.
She exuded confidence that the Reserve Bank would manage the volatility emerging from aggressive rate hike stance by the US Fed and the European Central Bank.
Talking about fiscal management during the COVID-19 period, she said, India with a targeted fiscal policy managed through a challenging time without printing money.
Referring to the global energy crisis triggered by the ongoing Russia-Ukraine war, she said, uncertainty over availability of crude, natural gas continues.
She also urged for deepening of ties between India and the US in all respects including on payment technology.
In a statement issued on the occasion of the completion of eight years of the scheme on Sunday, the Finance Minister said that the PMJDY has an expanded coverage of 67 per cent in rural or semi-urban areas.
At the same time, it has 56 per cent of women as account holders, the Finance Minister added.
The scheme had come under implementation on August 28, 2014.
"Continuation of the scheme beyond 2018 saw a marked shift in appro ach to meet challenges and requirements of emerging financial inclusion landscape in the country. There has been a shift in focus from 'every household' to 'every adult', with added emphasis on usage of accounts by enhancing Direct Benefit Transfer (DBT) flows through these accounts, promoting digital payments through the use of RuPay cards, etc," Sitharaman was quoted as saying in the statement.
The Finance Minister further said that the Jan Dhan-Aadhar-Mobile pipeline has enabled instant direct benefit transfer (DBT) under various government welfare schemes to the eligible beneficiaries.
"The advantage of the architecture created under financial inclusion ecosystem came handy during the Covid-19 pandemic when it facilitated direct income support to farmers under PM-KISAN and transfer of ex-gratia payment to women Jan Dhan account holders under Pradhan Mantri Garib Kalyan Package in a seamless and time-bound manner," she added.
Also, there is no GST on crematorium, funeral, burial, or mortuary services, the minister said and explained the Goods and Service Tax has been levied on the construction of new crematoriums.
The ongoing monsoon session of Parliament has witnessed several disruptions by the opposition after GST was imposed on several pre-packed and labelled essential items.
"More I listen to issues related to GST, I have a concern that probably the right information is not reaching. And as a result, there's quite a lot of misconception and I would today attempt to clear some of these misconceptions," the minister said.
In her reply to the debate, she sought to address concerns raised by opposition members, including on imposition of GST on essential items, like pulses, buttermilk, and curd.
She specifically explained the GST issues around bank chequebooks and cash withdrawals.
"I would like to say there is no GST on withdrawing of cash from a bank," Sitharaman, replying to a short discussion on price rise in the Rajya Sabha.
On the opposition's claims of burdening people by imposing GST on cheque books, she said the levy is in relation to purchase of cheque books by bans from printers, not for the public.
"I want you to kindly take into cognizance that as regards the consumer or the bank client who takes the money, withdraws the money, there is no charge on him," Sitharaman said.
She also informed the MPs about the number of free cash withdrawals allowed by banks from ATMs.
As regards contentions on GST being levied on crematoriums, the minister said made it clear that there is no such levy on crematorium, funeral, burial, or mortuary services.
"The GST Council is accused of having levied charges on the crematorium. You are going to bury your dead, you are being charge...No," the minister said.
She said the GST is only applicable on the construction of new crematoriums.
"So let's please not be led by misinformation," the finance minister said.
She also told the House that said the government has adopted a targeted approach, based on ground-level inputs, to tackle retail inflation which is ruling at around 7 per cent.
The Department of Revenue Intelligence (DRI) has issued a notice to Oppo for total customs duty of Rs 4,389 crore and these are on the grounds of misdeclaration of certain goods leading to a short payment in customs duty, she said, adding, "duty evasion we think is about Rs 2,981 crore".
"Undervaluation of imported goods for the purpose of payment of customs duty, that we think is an evasion of Rs 1,408 crore," she said.
She said voluntarily they have come about to deposit Rs 450 crore, much against the demand of Rs 4,389 crore.
She was replying to supplementaries during Question Hour.
Regarding the other companies, she said Xiaomi, which deals with assembled MI mobile phones, has been issued three show-cause notices.
"'The approximate duty liability there is about Rs 653 crore. For the three show cause notices, they have been issued, they have deposited only Rs 46 lakh," the minister said.
For Vivo India, a demand notice has been issued for Rs 2,217 crore for which they have deposited Rs 60 crore as a voluntary deposit, she informed the House.
"Besides these, the ED is looking at 18 companies that were established by the same group Vivo and there they have voluntarily remitted Rs 62 crore as deposits but the parent company outside of India has total sales of 1.25 lakh crore.
"Of the Rs 1.25 lakh crore total sales, Vivo has transferred through these 18 companies huge amounts of funds and it is believed that Vivo India has, in turn, remitted 0.62 lakh crore to its parent company which is outside India," Sitharaman said.
In her written reply, the finance minister said a show cause notice demanding Rs 4403.88 crore has been served on Oppo Mobiles India Ltd. based on the investigation conducted by the Directorate of Revenue Intelligence (DRI).
Five cases of Customs duty evasion have been booked against Xiaomi Technology India, she said
"During the period 2019 to 2022, in respect of Central Board of Indirect Taxes & Customs (CBIC), cases against 43 other such companies have been booked.
"'As regards to Central Board of Direct Taxes (CBDT), Investigation Directorates have undertaken search & seizure actions in cases of five groups pertaining to the telecom sector, in which tax evasion has been detected," Sitharaman said in her written reply.
Congress leaders Jairam Ramesh, Mukul Wasnik, RLD's Jayant Chaudhary and BJP's Surendra Singh Nagar are prominent names among the members who took oath.
The members elected to the Rajya Sabha during the recent biennial polls took oath in the presence of Chairman of the House M. Venkaiah Naidu in the chamber of the Upper House. These 27 members from 10 states took oath in 10 languages - 12 in Hindi, four in English, two each in Sanskrit, Kannada, Marathi and Oriya and one each in Punjabi, Tamil and Telugu. Four of the 57 newly-elected members have taken oath recently.
During an interaction with some leaders and members of the House after the oath taking ceremony, Chairman Naidu clarified that those elected members who are still to take oath also can vote in the Presidential election on July 18. Naidu further elaborated that from the date of the notification of the winners in the elections to Rajya Sabha, they are deemed to be Members of the House and making oath/affirmation is only a prerequisite for the newly elected members to participate in the proceedings of the House and of its Committees.
Others who took oath are Vivek K. Tankha, K. Laxman, Laxmikant Vajpayee, Kalpana Saini, Sulata Deo and R. Dharmar. Fourteen of the 57 members were re-elected to the House.
Naidu informed that the ensuing Monsoon Session of the House will also be held as per the Covid-19 protocol conforming with the social distancing and safety norms.
Naidu urged the members to uphold the dignity and decorum of the House through meaningful deliberations and abiding by the rules and conventions. Rajya Sabha Chairman advised the members to make proper use of the ample opportunities that will be available under various instruments of the House and to attend the House regularly during the sessions.
She also said on the issue of extending the Goods and Services Tax (GST) compensation from June 30, the views of some states were heard so far but nothing was decided.
Addressing the media at the conclusion of the two-day meeting of the Goods and Services Tax (GST) Council here, Sitharaman said casinos, horse-racing, and online gaming are all gambling.
"Whether it is horse-racing or online gaming or casinos, the common thread that the Committee highlighted was they are part of betting and gaming.
"In other words, they are essentially gambling. There may be an element of skill in it or an element of chance in it. But essentially, all the three are gambling," Sitharaman said.
She said the Group of Ministers (GoM), headed by Meghalaya Chief Minister Conrad K. Sangma, on betting, casinos, horse racing, online gaming which are taxed at 28 per cent, was in favour of status quo in this regard.
Sangma said the Goa Finance Minister had requested him to let him present his views on GST on casinos at the Council meeting and it agreed to hear again the issues of online gaming and others.
The GoM will submit its report on July 15 and it will be discussed at the next GST Council meeting to be held in Tamil Nadu's Madurai, the home town of both Sitharaman and Tamil Nadu Finance Minister Palanivel Thiaga Rajan.
Sitharaman also said that the GST Council also decided on the reports of three other GoMs.
She said the GST rate rationalisation GoM, headed by Karnataka Chief Minister Basavaraj Bommai, looked at the exemptions and the inverted tax structures, and the GST Council approved the revised rates whereby tax rates have been revised upwards on many items and reduced on some items.
Sitharaman said none of the Council members were against rate hikes.
The GoM on Information and Technology, headed by Maharashtra Deputy Chief Minister Ajit Pawar, in its report, recommended use of artificial intelligence and machine learning to ensure better data and compliance issue.
The risk-based models will be developed for fresh registrations and the Goods and Service Tax Network (GSTN) will work on the development of artificial intelligence and machine learning applications.
Queried about extending the GST compensation after June 30, Sitharaman said the views of some states were heard.
About 16 to 17 states are for extension of the period.
Addressing the 'Natural Allies in Development and Interdependence' conclave here, she said the Union government has been pumping in huge money in developing a number of infrastructure projects throughout the region.
"We are carrying out 20 railway projects worth Rs 74,000 crore for 2,011 km, which are spread across the northeast," Sitharaman said.
The Centre is also developing 4,000 km of roads in the region at a total cost of Rs 58,000 crore, she added.
"There are 15 ongoing air connectivity projects in the northeast, costing around Rs 2,200 crore," the finance minister said.
She, however, did not mention the completion period of these projects.
Addressing a roundtable on 'Investing in India's Digital Revolution' in San Francisco, the minister encouraged constant engagement with investors to understand and address their concerns.
The Finance Minister said she was open to receive suggestions, understand pain points and offer necessary redressal wherever possible.
"FM Smt. @nsitharaman said that in order to promote a robust #StartUp ecosystem in India, @DPIITGoI has set up a very proactive #StartUp cell and encouraged those interested in Indian #StartUps to engage with @DPIITGoI." a tweet from the Finance Ministry said.
During the interaction with Finanace Minister Smt. @nsitharaman at the Silicon Valley, potential of Indian #StartUps was the highlight and investors agreed that India’s potential in producing #Unicorn companies is immense. (2/5)
— Ministry of Finance (@FinMinIndia) April 27, 2022
During the meeting, investors from Silicon Valley also expressed that India's potential in producing Unicorn companies is immense.
"FM said that India, in pursuit of #digitization, has announced introduction of #DigitalCurrency by 2023. She also elucidated that #FinancialInclusion #FI will not be the sole purpose of this as India is already marching ahead to greater #FI, achieved through #JAM trinity," another tweet said.
FM Smt. @nsitharaman said that in order to promote a robust #StartUp ecosystem in India, @DPIITGoI has set up a very proactive #StartUp cell and encouraged those interested in Indian #StartUps to engage with @DPIITGoI. (4/5)
— Ministry of Finance (@FinMinIndia) April 27, 2022
Earlier in the day, the Finance Minister held lively interaction with a group of students studying at Stanford University covering a variety of topics.
She was accompanied by India's Ambassador to the US, Taranjit S Sandhu and Chief Economic Advisor V Ananth Nageswaran.
Sitharaman also participated in a roundtable discussion with Women CXOs representing various fields including fintech, health, education, IT, among others.
The meeting focussed on the ways through which they could continue to contribute to India's growth story.
"FM highlighted various Govt initiatives that are focussed on women-led development, such as schemes for #SHGs and #DirectBenefitTransfer that have especially benefited rural women, and others such as #MudraYojana that have empowered women entrepreneurs," a separate tweet said.
Quoting examples of strong, empowered and inspiring women from ancient Indian scriptures, the minister said, today's women are also no less and have the potential to innovate and reach new heights in their journey through their own technological and digital stewardship.
The Finance Minister had a meeting with Gen. James Mattis, former US Secretary of Defense, and currently Davies Family Distinguished Fellow, Hoover Institution, Stanford University and discussed matters of mutual interest between India and the US.
She also had a meeting with Perumal Gandhi co-founder Perfect Day, a Silicon Valley-based synbio/biotech StartUp.
It has developed technology to make milk proteins by leveraging microbial fermentation, rather than using animal source.
"Mr Perumal Gandhi discussed Perfect Day's growth plan with the FM and sought to #invest in India to accelerate Perfect Day's scale up journey and join in the #MakeInIndia campaign," another tweet said.
Replying to the debate in the Rajya Sabha on the Finance Bill, she said that the impact of a full-blown war in Ukraine is being felt by "all of us" as the war's impact has disrupted supplies and broken value chains.
"Now we are also facing the situation of a full-blown war in Ukraine which is not some war in some corner of the world but it seems to be having an impact on all countries like the way the pandemic has," she said.
Sitharaman also pointed out that the Central government did not increase taxes to fund the recovery from the impact of Covid, while citing an OECD report that said 32 countries had increased various tax rates during the pandemic.
"So, no tax was increased for our recovery process to be funded or aided."
Furthermore, she said that India remains as the top 5 FDI recipient countries in the world.
The minister pointed out that in the last 7 years and 9 months of the present government till December 2021, India recieved FDI inflows of $500.5 billion, which is 65 per cent higher than the inflows during the 10 years of the UPA government.
On Tuesday, Rajya Sabha continued to discuss the Finance Bill 2022 and Appropriation Bill, 2022 moved by the Finance Minister on Monday.
The Finance Bill was approved by the Lower House after accepting 39 official amendments moved by Finance Minister Nirmala Sitharaman and rejecting the amendments proposed by the opposition by voice vote.
Replying to a discussion on the Finance Bill, Sitharaman said India was probably the only country that did not resort to new taxes to fund the recovery of the economy hit by the COVID pandemic.
She said that according to an OECD report, as many as 32 countries have increased the tax rates after the pandemic.
"Instead, we put more money where multiplier effect would be maximum," she said while referring to the Budget's focus on raising capital expenditure.
The Budget 2022-23 raised Capex by 35.4 per cent to Rs 7.5 lakh crore to continue the public investment-led recovery of the pandemic battered economy.
Observing that the Modi government believes in lowering taxes, she said the reduction in corporate tax has "helped the economy, government and companies, and we are seeing the progress". She said Rs 7.3 lakh crore has been collected as corporate tax so far this fiscal.
The number of taxpayers has increased to 9.1 crore from 5 crore a few years back, she said, adding the government is taking steps to widen the tax base and the faceless assessment has been received well by people.
Responding to the concerns expressed by members on imposing customs duty on umbrella, she said it was done to encourage domestic manufacturing by MSMEs.
She further said that IFSC in Gujarat is making steady progress, and several global funds and insurance companies are setting up offices in the International Financial Services Centre at Gujarat International Finance Tec-City (GIFT).
The EPFO's central board takes a call on interest rate on provident fund deposits, and it is the board that has proposed cutting PF rate to 8.1 per cent for FY2021-22, she said in her reply to a discussion on Appropriation Bills in the Rajya Sabha.
"EPFO has a central board which is the one which takes the call on what rate has to be given for them, and they have not changed it for quite some time...they have changed it now ... to 8.1 per cent," she said.
It is a decision taken by the EPFO Central Board which has a wide spectrum of representatives in it. The EPFO has taken a call to keep the rate at 8.1 per cent, whereas rates offered by other schemes including Sukanya Samriddhi Yojana (7.6 per cent), Senior Citizen saving scheme (7.4 per cent) and PPF (7.1 per cent) are much lower.
"The fact remains these are rates which are prevailing today, and it (EPFO interest rate) is still higher than the rest," the finance minister said adding that EPFO's rates had remained unchanged for 40 years and the revision now reflected "today's realities".
The EPFO has proposed cutting down the interest rate on provident fund deposits from 8.5 per cent in 2020-21 to 8.1 per cent for 2021-22.
Sitharaman also referred to the pre-IPO valuation of LIC and said that the embedded value of the insurance behemoth was calculated in an "extremely scientific way" and has been disclosed in draft IPO papers filed with SEBI.
On excess spending approval being sought, she said that the government has borne higher cost of urea, and not passed it on to farmers.
She mentioned that the devolution of state share in central taxes is projected at Rs 8.17 lakh crore in FY2022-23, and the revised estimate of Rs 7.45 lakh crore for FY2021-22 has already been already released.
She further said that Rs 5,000 crore is proposed for recapitalisation of state insurance companies in the third batch of supplementary demands for grants.
The minister also stated that for 10 years nil defence procurement happened under the UPA rule and from pin to aircraft had to be ordered.
The budget was tabled by Union Finance Minister Nirmala Sitharaman amid opposition from some members including Congress MP Manish Tewari, who demanded for more time to discuss the budget. Opposition members are opposing a motion by the Finance Minister seeking suspension of certain rules to allow the Lok Sabha to take up the discussion on the same day.
Tewari said: "While scrapping Article 370, the government had said that Jammu and Kashmir will be emotionally integrated with the country and the pace of development will be increased. After 33 months, I would like to ask if the government is successful in achieving both the goals and I humbly say 'no'. Law and order situation was sensitive in 2019 and is more sensitive in 2022." Tewari said.
Tewari asked when statehood of Jammu and Kashmir will be restored as Prime Minister Narendra Modi and Home Minister Amit Shah have assured the House in the past.
Questioning ongoing delimitation process, Tewari said that as per his knowledge local political parties are not happy with the process and they need to be actively involved in the whole exercise. He demanded for provision of representation of Sikh minority in the assembly.
Participating in the discussion, BJP Member Jugal Kishor Sharma lauded Prime Minister Narendra Modi for scrapping Article 370 and said that development in the Union Territory has increased since August 2019. He also complimented Prime Minister Modi for his handling of the Covid-19 crisis in Jammu and the rest of India and providing free ration and Covid vaccine.
TMC Member Sougata Ray termed it as budget for bureaucratic expenditure and said, "I opposed abrogation of Article 370 and still oppose it as it was a wrong step and the country has to pay for it in future. Apart from fulfilling BJP's agenda it has no meaning."
Union Minister Dr Jitendra Singh asked will Congress commit on the floor of the House to bring back Article 370 if they return to power.
Participating in a post-Budget interaction with the Trade and Industry here, the minister said that this year's Union budget stands for continuity and gives an impetus for investment on infrastructure.
The interactive session was attended by members of the Industry and Trade Associations and covered an array of issues in key sectors of the economy as well as the nuances of the tax policy. The discussions touched upon topics relating to sectors including automobile, hospitality, banking & finance, health care, MSME, Information Technology and steel industry.
"The budget stresses upon use of technology and digitisation of economy along with strengthening the support system in healthcare post Covid," she said.
The minister said that this Budget has given thought to help children in bridging the gap that has widened due to education loss during the pandemic.
"The loss of education faced by the children over the past two years has been addressed in 2022-23 Union budget to bridge that gap," she said.
While underlining the importance of synergy among various government departments, she said: "Hon'ble Prime Minister's Gati Shakti plan is an umbrella for several projects of different departments and envisages states' participatory role leading to synergy and a multiplier effect especially in infrastructure."
Union Ministers of State for Finance Pankaj Choudhary, Dr Baghwat Kishanrao Karad, Finance Secretary T.V. Somanathan, Revenue Secretary Tarun Bajaj, and other senior officers of the Ministry of Finance were also present on the occasion.
Speaking at a post-budget interaction with the industry in the financial capital of the country, Sitharaman said the budget has been prepared at a time when the economy is coming out of the impact of the pandemic.
A sustained recovery is what we would want. The budget has growth revival as a priority along with messages for sustainability as a priority and on predictable tax regimen, she said.
Stating that technology has helped the government make payments to the affected people during the pandemic, Sitharaman said it is also looking at how digital solutions can be deployed in the education and the farming sectors.
The government wants to push innovation and the support to help the startups will continue, Sitharaman added.
Responding to the debate on the General Budget 2022-23 in the Rajya Sabha, she said that as per the report of Internet and Mobile Association, the rural internet user base is growing three times faster and is likely to surpass the urban user numbers soon.
"Data consumption through Bharatnet optical fibre surpassed 13,000 terrabytes in June 2021 while the Telecom Regulatory Authority of India's (TRAI) report in August 2021 said that the total number of internet subscribers has gone up to 82.5 crore," she said.
Sitharaman also said that, in the Budget she announced, the contracts for laying optical fibre connections in rural and remote areas will be awarded this year and will be completed by 2025.
Replying to the Opposition's comments on Bangladesh growing faster than India, she informed the House that India's economy is 10 times bigger than Bangladesh, so if Bangladesh grew at 10 per cent and India grew just at 1 per cent, the absolute number in terms of growth will be the same.
"To say Bangladesh is growing at 5.5 per cent and we are growing at 4.1 per cent is not a completely correct picture in terms of the growth rate," she said.
Responding to Congress MP Kapil Sibal's "India in Rahu Kaal since 2014" comment, she said: "Raau Kaal is when a sitting PM was about to meet the US President and a Bill he cleared was torn up.
"Rahu Kaal is what produces what is called G23, it is where the Congress party is. Ours is Amrit Kaal, senior leaders from the party are leaving their own party and getting out. That is Rahu Kaal."
On request by the Deputy Chairman, the Finance Minister concluded her speech while two Members laid their papers for the 'Special Mention' and the chair adjourned the House till March 14, as the first part of the Budget Session was over.
He was speaking at the inauguration of the Golden Jubilee Celebrations of ICRISAT (International Crops Research Institute for the Semi-Arid Tropics) here.
Taking forward years of efforts, Climate action was given more importance in this year's budget. This year's budget encourages India's commitment towards a green future in every sector, he said.
He also said the budget is focused on natural farming and digital agriculture.
Modi released a commemorative postal stamp on the occasion of ICRISAT's 50th Foundation day. He also launched the Climate Change Research Facility on plant protection.
Finance Minister Nirmala Sitharaman introduced the Central Bank Digital Currency (CBDC) in her Union Budget 2022-23 speech, saying that it will give a big boost to the digital economy.
"I said that the reserve bank (RBI) will be issuing a digital currency... a currency is a currency only when it is issued by a central bank, even if it's a crypto. So, let's understand that we are not taxing currencies which are yet to be regularised," Sitharaman said later during the press briefing on Tuesday, while clarifying the government's stance on crypto currency.
According to former Union Finance Secretary Subhash Chandra Garg, a key figure behind drafting the original Crypto Bill, the digital rupee announcement is just a formal one as of now.
"The RBI has not prepared its model or tested it. The government has also not indicated when it will bring out enabling laws for it. It is a long journey to take," Garg told IANS.
The Central Bank has already been deliberating upon various aspects relating to the central bank digital currency and private crypto currencies. It has been working on modalities for central bank digital currency.
CBDCs are presently mostly in the hypothetical stage, with some in proof-of-concept programmes.
However, more than 80 per cent of central banks are now looking at digital currencies.
According to Aniket Jindal, Co-founder of developer platform Biconomy, Such a Blockchain-based digital rupee has the potential for being a big step in onboarding hundreds of millions of Indians into the Blockchain economy.
"It will also help open one of the largest economies to new innovations in the Web 3.0 ecosystem," he said.
China's digital RMB was the first digital currency to be issued by a major economy. On September 27, 2021, Tajikistan announced the creation of a CBDC with the Fantom Foundation, and Nigeria was the first African country to launch its CBDC on October 25.
The Bank of America said in its recent report that a US CBDC would differ from the digital money currently available to the public because it would be a liability of the US Federal Reserve, not a commercial bank, and so would have no credit or liquidity risk.
The US Fed has also published a discussion paper on the benefits and risks of a CBDC.
According to Aishwarya Shivakumar, CEO of Oddz Finance, a decentralised finance crypto derivatives trading platform, with the announcement of RBI launching its own digital currency using Blockchain in 2023, the awareness of the technology and the economics surrounding it is only bound to increase.
"This announcement also implies a positive outlook of the government towards this technology and its potential," Shivakumar said.
As per the proposals made by the finance minister in the Union Budget for 2022-23, many commonly used items, including electronic items like mobile phones and chargers, are going to be cheaper.
The FM has announced reduction in the import duty on certain chemicals while customs duty on cut and polished diamonds, gems has been reduced to 5 per cent.
Here's is a list of items that will become cheaper and costlier:
Cheaper
Clothes
Leather items
Mobile phones
Mobile chargers
Gem stones and diamonds
Steel
Electronic items
Electric Transformers
Imported machines
Imitation jewellery
Agriculture equipment
Medicines
Chemicals
Medical equipment
Costlier
All imported items
Duty on umbrellas increased
The Cabinet is scheduled to meet at 10.10 a.m. to give the ascent to the Budget Document. And all eyes are on the Finance Minister as to what she is going to give relief to the public and keep the growth engine going at the sametime.
Union Finance Minister Nirmala Sitharaman tabled the economic survey, which said that India's economy is expected to grow at 8-8.5 per cent in the next fiscal.
According to the Survey 2021-22, the building back of the economic momentum along with enhanced vaccination drive as well as the likely long-term benefits of supply-side reforms in the pipeline, the Indian economy is in a good position to witness GDP "growth of 8.0-8.5 per cent in 2022-23".
"Growth in 2022-23 will be supported by widespread vaccine coverage, gains from supply-side reforms and easing of regulations, robust export growth, and availability of fiscal space to ramp up capital spending.
"The year ahead is also well poised for a pick-up in private sector investment with the financial system in a good position to provide support to the revival of the economy.
The Minister along with her team is scheduled to leave for Rashtrapati Bhavan from the Finance Ministry at 9 a.m.
After meeting President Ram Nath Kovind, the Finance Minister will brief the cabinet, headed by Prime Minister Narendra Modi, and then leave for the Parliament, informed the director general (media and communication) of the Ministry of Finance.
As per the established traditions, the President of India is the first to be briefed about the budget provisions by the Union Finance Minister.
It always a customary meeting as the President does not suggest any change in Union Budget, but officially it is all about taking the permission from the President by the Finance Minister before presenting the Budget in the Parliament.
After meeting the President, Sitharaman is to meet the Cabinet, headed by Prime Minister Narendra Modi, and brief the Cabinet about the budget.
"The ministry of finance maintains secrecy about the budget... before presenting his/her speech, the finance minister is bound to keep secrecy about the Budget provisions," an official said.
The 46th meeting of the GST Council, chaired by Union Finance Minister Nirmala Sitharaman and comprising state counterparts, decided to deliberate on the issue further in its next meeting.
Currently, tax rate on manmade fibre (MMF) is 18 per cent, MMF yarn 12 per cent, while fabrics are taxed at 5 per cent.
The Council in its previous meeting on September 17 had decided to correct the inverted duty structure in footwear and textile sectors.
With effect from January 1, 2022, all footwear, irrespective of prices, will attract GST at 12 per cent. It was also decided that 12 per cent uniform GST rate wold apply on textile products, except cotton, including readymade garments.
States like Gujarat, West Bengal, Delhi, Rajasthan and Tamil Nadu have said they are not in favour of a hike in Goods and Services Tax (GST) rate on textiles to 12 per cent, from 5 per cent, with effect from January 1, 2022.
Amit Mitra, advisor to West Bengal Chief Minister, had earlier urged the Centre to roll back the proposed tax rate hike on textiles, saying this would lead to closure of around 1 lakh textile units and 15 lakh job losses.
The GST Constitutional Amendment Act provides for the centre compensating the state for five years for loss of revenue arising on account of implementation of the goods and services tax (GST) and during the transition period, the states' revenue is protected at 14 per cent per annum over the base year revenue of 2015-16, she said.
"The central government is committed for GST compensation to States/UTs for 5 years as per the Constitutional provision," Sitharaman said in a written reply in the Rajya Sabha.
She was replying to a question on whether the government is aware of the fact that the projected 14 per cent growth rate of revenue is not attained by any state and, if so, whether the government intends to provide the GST compensation after 2022.
GST, which subsumed indirect taxes like excise duty, service tax and VAT, was rolled out from July 1, 2017. The five year period for compensation ends in June 2022.
After the 45th GST Council meeting, chaired by the Union Finance Minister and comprising state finance ministers, on September 17, the Centre had said that the regime of paying GST compensation to the states for revenue shortfall will end in June next year.
However, the compensation cess, levied on luxury and demerit goods, will continue to be collected till March 2026, to repay the borrowings that were done in 2020-21, and 2021-22 fiscal years to compensate states for GST revenue loss.
In a reply to a separate question, Sitharaman said Rs 37,134 crore and Rs 14,664 crore worth GST compensation is yet to be released to states for 2020-21 and 2021-22 fiscal years respectively.
Under the GST law, states are compensated for any loss of revenue arising on account of implementation of GST for five years till June 2022. The compensation amount to be paid from the compensation fund which is arrived at by levying cess on top of the highest tax slab on luxury, demerit and sin goods.
GST compensation for financial years 2017-18, 2018-19 and 2019-20 has already been paid to the states.
Since collections in the compensation fund are falling short of requirement, for 2020-21 and 2021-22 fiscal years the centre has borrowed funds worth Rs 1.10 lakh crore and Rs 1.59 lakh crore respectively and passed it on to the states as back-to-back loans.
"Centre is committed to release full GST compensation to the States/UTs as per GST (Compensation to States) Act, 2017 for the transition period by extending the levy of Compensation cess beyond five years to meet the GST revenue shortfall as well as servicing the loan borrowed through special window scheme," Sitharaman said.
Sitharaman, during Question Hour in the Rajya Sabha, said there is no "official stated policy" directing banks not to give loans to certain categories of customers.
"Banks make assessments based on KYC and other ratings like civil ratings. I don't think any specific instructions are given to banks -- please be careful not to lend to these people," she said in the Upper House while responding to a supplementary queries.
However, banks do exercise a certain level of discretion based on their available KYC (know your customer), she added.
Minister of State for Finance Bhagwat Kishanrao Karad said banks do have "problems" in lending to police and politicians. Banks see track record before lending to these customers, he added.
Responding to another question on banks not lending to politically exposed persons (PEPs), the Union Finance Minister said, "...this is more from the point of view of large sums of money are transferred from one account to another complying with the global requirement where the financial action on terror funding happens."
So according to them, the minister said every account will have to be kept on a tab where huge money is transferred to a sensitive bank account, she added.
Finance Minister Nirmala Sitharaman, in a written reply in the Lok Sabha, also said that the government does not collect data on Bitcoin transactions.
Bitcoin is a form of digital currency which allows people to buy goods and services among others.
In the ongoing winter session of Parliament, the Centre aims to table the Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, through which it seeks a ban on all private cryptocurrencies.
At present, there is no regulation or ban in the country on cryptocurrency.
The Reserve Bank of India has maintained its strong views against cryptocurrencies, saying they pose serious threats to macroeconomic and financial stability.
The central bank also doubted the reported number of investors trading on them and their claimed market valuations.
It said that Atmanirbhar Bharat Mission encapsulating major structural reforms continues to play a critical role in shaping India's economic recovery, both through the signalling of business opportunities and expansion of spending channels.
Armed with necessary macro and micro growth drivers, the stage is set for India's investment cycle to kickstart and catalyse its recovery towards becoming the fastest growing economy in the world, the report said.
India's economic recovery has gathered steam in the festive season, recording a decade high Diwali sales of Rs 1.3 lakh crore as per Confederation of All India Traders. Improving Covid-19 situation amid high business and consumer spirits has delivered sustained economic recovery in October, 2021 as well.
The finance ministry report, however, said that the global economic recovery continues to be impacted by prolonged supply constraints and input cost inflation. Yet IMF in its October, 2021 update foresees improved global growth prospects at 5.8 per cent in 2021 and 4.9 per cent in 2022 triggering a coterminous global trade growth, by volume, at 9.7 per cent and 6.7 per cent respectively. World Trade Organisation's October forecast also confirms favourable trade prospects underpinned by resurgence in global economic activity and vaccine dissemination. This augurs well for India's export performance in the near future lending credence to IMF projecting India to become the fastest growing economy, among major countries, in the current and the following year, said the DEA report.
The report had identified the external sector to play a critical part in India's economic revival with exports visibly emerging as an engine of growth. India's merchandise exports in October, 2021 have now crossed the US$ 30 billion mark for the seventh consecutive month. With merchandise imports in FY 2021-22 until October, 2021 also crossing their pre-pandemic 2019 levels, rapid recovery of domestic output is evident. FDI achieved the US$ 20 billion mark in the first five months of FY 22 as it did in FY 21. India's foreign exchange reserves stood comfortably at US$ 640.1 billion as on October 22, 2021, providing cover for around 14 months of imports projected for 2021-22.
Sitharaman met Malpass at the World Bank headquarters in Washington DC on Friday.
"Both sides discussed various issues including #COVID #vaccination, #economicrecovery, preparations for #CoP26, initiative of #WBG for increasing lending space for India, IDA 20 replenishment, knowledge partnership with @WorldBank," Finance Ministry said in a series of tweets.
During the meeting, Sitharaman shared the measures being taken by India to contain the spread of the second wave of COVID-19 pandemic, including the major role played by India on the global COVID-19 effort, the ministry said.
She appreciated the World Bank Group for their initiative for increasing lending space for India to enhance availability of finance for development.
The minister also mentioned that the focus should be on technologies that need to be moved from lab to field and those that require targeted global research in the pursuit of low carbon growth.
She highlighted three broad suggestions, including strengthening #LighthouseIndia, #technology and special focus on #FinancialSectorReforms and #infrastructure sector to strengthen the knowledge partnership with #WBG, it said.
Earlier, in her address to the Development Committee of the World Bank, she said India has not only faced the COVID-19 crisis with great resilience and fortitude but has also played a major role and "walked the talk" on the global fight against the pandemic.
She highlighted that the measures taken by the government have set a strong foundation of the country's sustained economic growth.
She said the Indian government, besides taking economic relief measures, has also undertaken significant structural reforms to turn the crisis into an opportunity and emerge stronger.
The minister also discussed the preparations for the upcoming Climate Change Conference in Glasgow.
From here, she will go to New York for an interactive session with the business community before flying back home. She started her week-long trip from Boston.
In addition to her meetings at the International Monetary Fund and the World Bank, Sitharaman had more than 25 bilateral engagements.